Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"): (a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness; (b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively; (c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding; (d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph; (e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that: (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and (1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e); (f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding; (g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; (h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued; (i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly: (i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or (ii) deposited to defease the Notes pursuant to Article 8 hereof. (j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and (k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 4 contracts
Samples: Indenture (Assisted Living Concepts Inc), Indenture (Assisted Living Concepts Inc), Indenture (Assisted Living Concepts Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Corporation shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company Corporation shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; , provided, however, that the Company Corporation or any of its Restricted Subsidiaries may incur Subordinated Indebtedness (including or Acquired Debt) Debt or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Subordinated Indebtedness or Acquired Debt or issue preferred stock, if the Fixed Charge Coverage Consolidated Total Debt to Consolidated EBITDA Ratio for the Company's Corporation’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Subordinated Indebtedness or Acquired Debt is incurred or such Disqualified Stock or such preferred stock is issued issued, as the case may be, would not have been at least greater than 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Subordinated Indebtedness or Acquired Debt had been incurred or the Disqualified Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; provided further, that, notwithstanding Section 5.19, any Restricted Subsidiary that ceases to be a Wholly-Owned Subsidiary of the Corporation as a result of such Restricted Subsidiary issuing Capital Stock pursuant to this Section 5.7 shall be deemed to remain a Restricted Subsidiary for all purposes under this Indenture. The first paragraph of this Section 4.09 5.7 shall not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "“Permitted Debt"”):
(a1) the incurrence by the Company Corporation or any of its Restricted Subsidiaries and the guarantee thereof by any of the Guarantors of Indebtedness and letters of credit (and reimbursement obligations with respect thereto) under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (1), $50 million, provided that the aggregate principal amount of Indebtedness permitted to be incurred by the Corporation at any time pursuant to this clause (1) shall be decreased by the principal amount of Indebtedness then incurred by the Corporation pursuant to clauses (3) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the Existing Indebtednessdefinition of “Permitted Liens”) of this paragraph;
(b2) the incurrence by the Company Corporation or any Restricted Subsidiary of Existing Indebtedness (other than Indebtedness permitted under clauses (4), (6), (10), (16) and (17));
(3) Indebtedness incurred by a Receivables Entity in a Qualified Receivables Transaction, provided that, after giving effect to any such incurrence, the aggregate principal amount of Indebtedness at any one time outstanding under this clause (3) does not exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (3), $50 million, provided further, that the aggregate principal amount of Indebtedness permitted to be incurred by any Receivables Entity at any time pursuant to this clause (3) shall be decreased by the principal amount of additional Indebtedness then incurred by the Corporation pursuant to clauses (1) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the definition of “Permitted Liens”) of this paragraph;
(4) letters of credit and banker’s acceptances issued in the ordinary course of business (and reimbursement obligations with respect thereto) in an aggregate principal amount (with letters of credit and banker’s acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, as of any date of incurrence of Indebtedness pursuant to this clause (4), when combined with any Existing Indebtedness that comprises of letters of credit and banker’s acceptances (with such letters of credit and banker’s acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) and all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), $25 million;
(5) the incurrence by the Issuer, the Corporation and the other Guarantors of Indebtedness represented by the Notes, the Junior Notes related Note Guarantees, the Senior Subordinated Exchangeable Debentures and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySenior Subordinated Exchangeable Debenture Guarantees;
(c6) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Attributable Debt in connection with a sale and leaseback transaction or Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of property, plant or equipment used in the business of the Company Corporation or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (c6), not to exceed exceed, as of any date of incurrence of Indebtedness pursuant to this clause (6), $2.5 million at any time outstanding15 million;
(d7) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 5.7 or clauses (a2), (b), 5) and (c), (d) or (j7) of this paragraph;
(e) 8) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of intercompany Intercompany Indebtedness between or among the Company Corporation and any one or more of its Restricted Subsidiaries or between or among two or more Restricted Subsidiaries; , provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries and (2b) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Corporation or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e8);
(9) the issuance by any of the Corporation’s Restricted Subsidiaries to the Corporation or to any of its Restricted Subsidiaries of shares of preferred stock, provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Corporation or any of its Restricted Subsidiaries and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Corporation or any of its Restricted Subsidiaries shall be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (9);
(f10) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Cash Management Obligations and Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect business in an aggregate principal amount not to exceed $25 million at any floating rate Indebtedness that is permitted by the terms of this Indenture to be one time outstanding;
(g11) the Guarantee guarantee by the Company Issuer, the Corporation or any of the other Guarantors of Indebtedness of the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries that was permitted to be incurred by another provision of this Section 4.095.7, provided that if the Indebtedness being guaranteed is subordinated to the Notes, then the Guarantee must be subordinated to the same extent as the Indebtedness guaranteed;
(h12) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, unemployment or other insurance or self-insurance obligations, bankers’ acceptances, performance, completion and surety bonds, completion guarantees and similar obligations in the ordinary course of business;
(13) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a cheque, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(14) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Corporation or such Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn outs or similar obligations, in each case, incurred or assumed in connection with the acquisition, sale or disposition of any business or assets, or Capital Stock of the Corporation or any of its Subsidiaries, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(15) the incurrence of contingent liabilities arising out of endorsements of cheques and other negotiable instruments for deposit or collection in the ordinary course of business;
(16) the incurrence of Indebtedness, consisting of guarantees of loans or other extensions of credit to or on behalf of current or former officers, directors, employees and consultants (and their spouses and estates) of the Corporation or any of its Restricted Subsidiaries for the purpose of permitting such Persons to purchase or redeem Capital Stock of the Corporation or any of its Restricted Subsidiaries or in connection with the exercise by such Persons of stock options of the Corporation or any of its Restricted Subsidiaries and the funding of the exercise price of such stock options, in an aggregate principal amount not to exceed $2 million at any one time outstanding;
(17) Indebtedness of the Corporation or any of its Restricted Subsidiaries to credit card providers, processors or intermediaries in connection with credit card processing or financing services incurred in the ordinary course of business of the Corporation and its Restricted Subsidiaries in an aggregate principal amount not to exceed $25 million;
(18) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness owed to one or more Persons in respect of premium financing or similar deferred payment obligations with respect to insurance policies purchased in the ordinary course of business; and
(19) the incurrence by the Corporation or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any one time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (19), not to exceed $40 million. The Issuer shall not incur, and shall not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Issuer or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms, provided, however, that no Indebtedness shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuer or a Guarantor solely by virtue of being unsecured or by virtue of being secured on a junior priority basis. For purposes of determining compliance with this Section 5.7, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (19) of this Section 5.7, or is entitled to be incurred pursuant to the first paragraph of this Section 5.7, the Corporation shall be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock, in any manner that complies with this Section 5.7. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; 5.7, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges Consolidated Total Debt of the Company Corporation as accrued;
(i) . Notwithstanding any other provision of this Section 5.7, the maximum amount of Indebtedness of that the Company Corporation or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 5.7 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date shall be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueof the Indebtedness, as applicable) at in the case of any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(k3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the incurrence by Fair Market Value of such assets at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(b) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 2 contracts
Samples: Trust Indenture (Wall2wall Media Inc.), Trust Indenture (Wall2wall Media Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Issuers may incur Indebtedness or issue shares of Disqualified Stock and the Company's Restricted Subsidiaries that are Subsidiary Guarantors may incur Indebtedness or issue shares of preferred stockstock if (i) no Default or Event of Default shall have occurred and be continuing at the time or as a consequence of the incurrence of any such Indebtedness or the issuance of any such Disqualified Stock, if and (ii) the Consolidated Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 Four-Quarter Period would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such fourFour-quarter periodQuarter Period. The provisions of the first paragraph of this Section 4.09 shall covenant will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtIndebtedness"):
(ai) the Notes issued in the Offering and the Subsidiary Guarantees thereof;
(ii) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness incurred pursuant to one or more Credit Facilities in an aggregate principal amount at any time outstanding (with letters of credit being deemed to have a principal amount equal to the Existing maximum potential liability of the Company and its Subsidiaries thereunder) not to exceed the sum of (a) $50.0 million (which amount shall initially be utilized for term Indebtedness;
) plus (b) the incurrence by greater of (I) the Company Borrowing Base or (II) $275.0 million, less, in the case of clauses (a) and (b)(II), taken together, (A) the Guarantors aggregate amount of Indebtedness represented by of Securitization Entities at the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
time outstanding less (cB) the incurrence amount of all optional or mandatory principal payments actually made by the Company or any of its Restricted Subsidiaries since the date of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, this Indenture in each case, respect of term loans under Credit Facilities incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to under this clause (cii) (excluding any such payments to the extent refinanced at the time of payment under a Credit Facility), not and (C) further reduced by (X) any repayments of revolving credit borrowings under Credit Facilities that are applied in accordance with Section 4.10 and (Y) any Attributable Debt incurred in pursuant to exceed $2.5 million at any time outstandingSection 4.16;
(diii) the incurrence by the Company or any of and its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or under Currency Agreements;
(iv) the net proceeds incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness;
(v) Interest Swap Obligations of the Company and its Restricted Subsidiaries covering Indebtedness of the Company and its Restricted Subsidiaries; provided that any Indebtedness to which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was any such Interest Swap Obligations correspond is otherwise permitted by this Indenture to be incurred under this Indenture; and provided, further, that such Interest Swap Obligations are entered into, in the first paragraph judgment of this Section 4.09 or clauses (a)the Company, (b), (c), (d) or (j) of this paragraphto protect the Company and its Restricted Subsidiaries from fluctuation in interest rates on its outstanding Indebtedness;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence of Acquired Indebtedness of Restricted Subsidiaries of the Company to the extent the Company could have incurred such Indebtedness in accordance with the first paragraph of this covenant on the date such Indebtedness became Acquired Indebtedness;
(viii) Guarantees by the Company and the Subsidiary Guarantors of each other's Indebtedness; provided that such Indebtedness is permitted to be incurred under this Indenture;
(ix) Indebtedness (including Capitalized Lease Obligations) incurred by the Company or any of its Restricted Subsidiaries to finance the purchase, lease or improvement of property (real or personal) or equipment (whether through the direct purchase of assets or the Capital Stock of any Person owning such assets) in an aggregate principal amount outstanding not to exceed 5% of Total Assets at the time of any incurrence thereof (including any Refinancing Indebtedness with respect thereto) (which amount may, but need not, be incurred in whole or in part under the Senior Credit Facilities);
(x) the incurrence of Indebtedness (including letters of credit) in respect of workers' compensation claims, self-insurance obligations, performance, surety, bid or similar bonds and completion guarantees provided by the Company or a Restricted Subsidiary in the ordinary course of business and consistent with past practices;
(xi) Indebtedness arising from agreements of the Company or a Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price, earn out or other similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Restricted Subsidiary of the Company, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition; provided that the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(xii) obligations in respect of performance and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary of the Company in the ordinary course of business;
(xiii) any refinancing, modification, replacement, renewal, restatement, refunding, defeasance, deferral, extension, substitution, supplement, reissuance or resale of existing or future Indebtedness (other than intercompany Indebtedness), including any additional Indebtedness incurred to pay interest or premiums required by the instruments governing such existing or future Indebtedness as in effect at the time of issuance thereof ("Required Premiums") and fees in connection therewith ("Refinancing Indebtedness"); provided that (1) any such event shall not directly or indirectly result in an increase in the aggregate principal amount of Permitted Indebtedness (except to the extent such increase is a result of a simultaneous incurrence of additional Indebtedness (A) to pay Required Premiums and related fees or (B) otherwise permitted to be incurred under this Indenture) of the Company and its Restricted Subsidiaries, (2) such Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded, (3) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes, such Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the Notes on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;
(xiv) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations additional Indebtedness and/or the issuance of Disqualified Stock in an aggregate principal amount or aggregate liquidation value, as applicable (or accreted value, as applicable), at any time outstanding, including all Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xiv), not to exceed $20 million; and
(xv) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that are incurred is Non-Recourse Debt (except for the purpose of fixing or hedging interest rate risk Standard Securitization Undertakings) with respect to the Company and its other Restricted Subsidiaries. The Issuers shall also not incur any floating rate Indebtedness (including Permitted Indebtedness) that is permitted by the terms contractually subordinated in right of this Indenture payment to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of other Indebtedness of the Company or a Restricted Subsidiary Issuers unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company Issuers shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuers solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that was permitted an item of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses (i) through (xv) above or is entitled to be incurred by another provision pursuant to the first paragraph of this Section 4.09;
(h) , the accrual Issuers shall, in their sole discretion, classify such item of Indebtedness in any manner that complies with this Section 4.09. Accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Consolidated Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Anthony Crane Sales & Leasing Lp), Indenture (Anthony Crane Holdings Capital Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, Stock and the Company's ’s Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, in each case, if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not not, prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"):
”): (ai) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness and letters of credit under Credit Facilities, in an aggregate principal amount at any one time outstanding under this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the greater of: (A) $700.0 million; and (B) 30.0% of the Existing Indebtedness;
Company’s Consolidated Net Tangible Assets as of the date of such incurrence; (bii) (A) the incurrence by the Company or any of its Restricted Subsidiaries of Existing Indebtedness or (B) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under the 2018 Xxxxx Fargo Master Loan Facility and the Guarantors New BofA Real Estate Facility (whether or not issued and outstanding as of the Issue Date) in each case of this clause (B), in amounts contemplated by the documentation for the 2018 Xxxxx Fargo Master Loan Facility and the New BofA Real Estate Facility at the date of closing of the Acquisition; (iii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture Issue Date and the date of Exchange Notes and the Junior Note related Subsidiary Guarantees to be issued pursuant to the Registration Rights Agreement (and any exchange notes or other debt properly incurred under this Indenture, respectively, where the terms of such exchange notes are substantially identical to such other debt); (iv) the incurrence by the Company or pursuant to Section 4.21 any of this Indenture or Section 4.21 its Restricted Subsidiaries of the Junior Note Indenture, respectively;
Indebtedness under Floor Plan Facilities; (cv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refund or refinance or replace any Indebtedness incurred pursuant to this clause (cv), not to exceed $2.5 million exceed, at any time outstanding;
, the greater of $100.0 million and 2.0% of Consolidated Total Assets; (dvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 covenant or clauses (aii), (biii), (c), (d) or (jvi) of this paragraph;
; provided that to the extent such Permitted Refinancing Indebtedness refinances (ex) other than the Existing Notes, Indebtedness junior to the Notes or a Guarantee, as applicable, such Refinancing Indebtedness is junior to the Notes or the Guarantee, as applicable, or (y) Disqualified Stock or preferred stock, such Refinancing Indebtedness is Disqualified Stock or preferred stock; (vii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (iA) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness owing to a Restricted Subsidiary, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a Guarantor; and
and (1B) (I) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2II) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
; (fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
speculative purposes; (gix) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest4.09 and Indebtedness incurred on behalf of, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence representing guarantees of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; providedof, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness joint ventures of the Company or any Restricted Subsidiary not to exceed, at any time outstanding, the extent greater of (x) $100.0 million and (y) 2.0% of the Consolidated Total Assets of the Company; (x) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within five Business Days of its incurrence; (xi) Obligations in respect of (A) performance, bid and surety or appeal bonds, letters of credit, completion guarantees, self-insurance obligations or workers compensation claims in the Net Proceeds thereof are promptly:
ordinary course of business and (iB) used to agreements providing for indemnification, adjustment of purchase Notes tendered price, earn-outs or similar obligations incurred in connection with the acquisition or disposition of any business, assets or subsidiary; (xii) Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of business; (xiii) Indebtedness consisting of the financing of insurance premiums; (xiv) Indebtedness consisting of Guarantees incurred in the ordinary course of business under repurchase agreements or similar agreements in connection with the financing of sales of goods in the ordinary course of business; (xv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under Mortgage Loans in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes amount incurred pursuant to Article 8 hereof.
this clause (jxv) not to exceed the greater of $300.0 million and 7.0% of Consolidated Total Assets at any time outstanding; (xvi) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstandingwhich, including when taken together with all Permitted Refinancing other Indebtedness incurred to refund, refinance or replace any Indebtedness of the Company and its Restricted Subsidiaries outstanding on the date of such incurrence and incurred pursuant to this clause (j)xvi) does not exceed the greater of $250.0 million and 6.0% of Consolidated Total Assets; and (xvii) Indebtedness, not to exceed $5.0 million; and
Disqualified Stock or Preferred Stock of (kx) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by Company or a Restricted Subsidiary of incurred to finance an acquisition or (y) Persons that are acquired by the Company that was not permitted by this clause (k). The Company shall not incur or any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of Restricted Subsidiary or merged into or consolidated with the Company unless or a Restricted Subsidiary in accordance with the terms of this Indenture; provided that after giving effect to such acquisition, merger or consolidation, either: (A) the Company would be permitted to incur at least $1.00 of additional Indebtedness is also contractually subordinated in right of payment pursuant to the Notes on substantially identical terms; providedFixed Charge Coverage Ratio test set forth in the first paragraph of this Section 4.09, howeveror (B) the Fixed Charge Coverage Ratio is greater than or equal to the Fixed Charge Coverage Ratio immediately prior to such acquisition, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredmerger or consolidation. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxvii) aboveof the preceding paragraph, or is and may also be entitled to be incurred in whole or in part pursuant to the first paragraph of this Section 4.09, the Company shall will be permitted to divide and classify such item of Indebtedness on the date of its incurrence, or incurrence and later divide and reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09; for the avoidance of doubt, any Incurrence of Indebtedness may, if applicable, be classified in part as being Incurred and outstanding under the first paragraph of this Section 4.09 and in part as being Incurred and outstanding under one or more categories of Permitted Debt. Indebtedness that was outstanding on the Issue Date under Credit Facilities and Indebtedness that was outstanding under clause (ii)(B) of the definition of Permitted Debt as of the closing date of the Acquisition will be deemed to have been incurred on such date in reliance on the exception provided by clause (i) or clause (ii)(B), as applicable, of the definition of Permitted Debt and unless repaid may not be reclassified. Accrual of interest and dividends, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, changes to amounts outstanding in respect of Hedging Obligations solely as a result of fluctuations in interest rates, the assumption or guarantee of Indebtedness of a Restricted Subsidiary by the Company or another Restricted Subsidiary and the payment of dividends on Disqualified Stock or preferred stock of Restricted Subsidiaries in the form of additional shares of the same class of Disqualified Stock or preferred stock of Restricted Subsidiaries will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock or preferred stock of Restricted Subsidiaries for purpose of this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Asbury Automotive Group Inc), Indenture (Asbury Automotive Group Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Holdings shall not, and shall not permit any of its Restricted Subsidiaries and Unrestricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and the Company that Holdings shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Holdings and its Restricted Subsidiaries may incur Indebtedness (including Acquired DebtIndebtedness) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if Stock if: (i) the Fixed Charge Coverage Ratio for the Company's Holdings' most recently ended four full fiscal quarters 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 would have been (A) at any time prior to March 15, 1999, at least 2.0 2.00 to 1 and (B) at any time thereafter, at least 2.25 to 1, in each case determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and (ii) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; provided, that no guarantee may be incurred pursuant to this paragraph unless the guaranteed Indebtedness is incurred by Holdings or a Restricted Subsidiary pursuant to this paragraph. The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by Holdings and its Restricted Subsidiaries of Indebtedness and letters of credit pursuant to the Company New Credit Agreement (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of Holdings or the relevant Restricted Subsidiary thereunder) in a maximum principal amount outstanding at any one time not to exceed $55.0 million (or in the event of any refinancing of the Indebtedness under the New Credit Agreement, the greater of $55.0 million or the Borrowing Base)
(1) less the amount of all mandatory principal payments actually made by Holdings in respect of term loans thereunder (excluding any such payments to the extent refinanced at the time of payment under a replaced credit agreement) and (2) in the case of the revolving credit facility, reduced by any required permanent repayments (which are accompanied by a corresponding permanent commitment reduction) thereunder;
(ii) the incurrence by Holdings and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company Anvil and the Guarantors Holdings of Indebtedness represented by the Notes, the Junior Senior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture Holdings' guarantee thereof and the date incurrence by Holdings of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of Indebtedness represented by the Junior Note Indenture, respectivelyExchange Debentures;
(civ) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsPurchase Money Obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company Holdings or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 7.5 million at any time outstanding;
(dv) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evi) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Holdings and any of its Restricted Wholly Owned Subsidiaries or between or among any Wholly Owned Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Wholly Owned Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Holdings or a Restricted Wholly Owned Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Holdings or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(fvii) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingincurred;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jviii) the incurrence by the Company or any of Holdings and its Restricted Subsidiaries of additional Indebtedness (including Acquired Debtin addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), outstanding not to exceed $5.0 20.0 million; andprovided that such Indebtedness incurred by foreign subsidiaries that are Restricted Subsidiaries shall not exceed an aggregate principal amount at any time outstanding of $7.5 million.
(kix) the incurrence by the Company's Holdings' Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of Holdings;
(x) Indebtedness incurred by Holdings or any of its Restricted Subsidiaries arising from agreements providing for indemnification, adjustment of purchase price or similar obligations, or from guarantees or letters of credit, surety bonds or performance bonds securing the Company that was performance of Holdings or any of its Restricted Subsidiaries pursuant to such agreements, in connection with the disposition of any business, assets or Restricted Subsidiary of Holdings (other than guarantees or similar credit support by Holdings or any of its Restricted Subsidiaries of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition), in a principal amount not permitted to exceed 25% of the gross proceeds (with proceeds other than cash or Cash Equivalents being valued at the fair market value thereof as determined by this clause the Board of Directors of Holdings in good faith) actually received by Holdings or any of its Restricted Subsidiaries in connection with such disposition; and
(k). The Company shall not incur any xi) the incurrence by a Securitization Entity of Indebtedness (including Permitted Debt) in a Qualified Securitization Transaction that is contractually subordinated in right non-recourse to Holdings or any Subsidiary of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical termsHoldings (except Standard Securitization Undertakings); provided, however, that no the amount of Indebtedness of outstanding under clause (i) above and this clause (xi) shall not in the Company shall be deemed to be contractually subordinated in right of payment to aggregate exceed $55.0 million at any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, time outstanding (or in the event that an item of proposed Indebtedness meets the criteria of more than one a refinancing of the categories Indebtedness under the New Credit Agreement, the greater of Permitted Debt described in clauses (a) through (k) above, $55.0 million or is entitled to be incurred pursuant to the first paragraph Borrowing Base). Notwithstanding any other provision of this Section 4.09covenant, the Company shall be permitted to classify such item a guarantee of Indebtedness on permitted by the date terms of its incurrence, or later reclassify all or this Indenture at the time such Indebtedness was incurred shall not constitute a portion of such item separate incurrence of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Cottontops Inc), Indenture (Anvil Holdings Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Corporation shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company Corporation shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; , provided, however, that the Company Corporation or any of its Restricted Subsidiaries may incur Subordinated Indebtedness (including or Acquired Debt) Debt or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Subordinated Indebtedness or Acquired Debt or issue preferred stock, if the Fixed Charge Coverage Consolidated Total Debt to Consolidated EBITDA Ratio for the Company's Corporation’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Subordinated Indebtedness or Acquired Debt is incurred or such Disqualified Stock or such preferred stock is issued issued, as the case may be, would not have been at least greater than 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Subordinated Indebtedness or Acquired Debt had been incurred or the Disqualified Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; provided further, that, notwithstanding Section 8.18, any Restricted Subsidiary that ceases to be a Wholly-Owned Subsidiary of the Corporation as a result of such Restricted Subsidiary issuing Capital Stock pursuant to this Section 8.7 shall be deemed to remain a Restricted Subsidiary for all purposes under this Indenture. The first paragraph of this Section 4.09 8.7 shall not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "“Permitted Debt"”):
(a1) the incurrence by the Company Corporation or any of its Restricted Subsidiaries and the guarantee thereof by any of the Guarantors of Indebtedness and letters of credit (and reimbursement obligations with respect thereto) under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (1), $50 million, provided that the aggregate principal amount of Indebtedness permitted to be incurred by the Corporation at any time pursuant to this clause (1) shall be decreased by the principal amount of Indebtedness then incurred by the Corporation pursuant to clauses (3) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the Existing Indebtednessdefinition of “Permitted Liens”) of this paragraph;
(b2) the incurrence by the Company Corporation or any Restricted Subsidiary of Existing Indebtedness (other than Indebtedness permitted under clauses (4), (6), (10), (16) and (17));
(3) Indebtedness incurred by a Receivables Entity in a Qualified Receivables Transaction, provided that, after giving effect to any such incurrence, the aggregate principal amount of Indebtedness at any one time outstanding under this clause (3) does not exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (3), $50 million, provided further, that the aggregate principal amount of Indebtedness permitted to be incurred by any Receivables Entity at any time pursuant to this clause (3) shall be decreased by the principal amount of additional Indebtedness then incurred by the Corporation pursuant to clauses (1) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the definition of “Permitted Liens”) of this paragraph;
(4) letters of credit and banker’s acceptances issued in the ordinary course of business (and reimbursement obligations with respect thereto) in an aggregate principal amount (with letters of credit and banker’s acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, as of any date of incurrence of Indebtedness pursuant to this clause (4), when combined with any Existing Indebtedness that comprises of letters of credit and banker’s acceptances (with such letters of credit and banker’s acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) and all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), $25 million;
(5) the incurrence by the Issuer, the Corporation and the other Guarantors of Indebtedness represented by the Senior Secured Notes, the Junior Notes related Senior Secured Note Guarantees, the Debentures and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyDebenture Guarantees;
(c6) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Attributable Debt in connection with a sale and leaseback transaction or Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of property, plant or equipment used in the business of the Company Corporation or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (c6), not to exceed exceed, as of any date of incurrence of Indebtedness pursuant to this clause (6), $2.5 million at any time outstanding15 million;
(d7) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 8.7 or clauses (a2), (b), 5) and (c), (d) or (j7) of this paragraph;
(e) 8) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of intercompany Intercompany Indebtedness between or among the Company Corporation and any one or more of its Restricted Subsidiaries or between or among two or more Restricted Subsidiaries; , provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries and (2b) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Corporation or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e8);
(9) the issuance by any of the Corporation’s Restricted Subsidiaries to the Corporation or to any of its Restricted Subsidiaries of shares of preferred stock, provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Corporation or any of its Restricted Subsidiaries and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Corporation or any of its Restricted Subsidiaries shall be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (9);
(f10) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Cash Management Obligations and Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect business in an aggregate principal amount not to exceed $25 million at any floating rate Indebtedness that is permitted by the terms of this Indenture to be one time outstanding;
(g11) the Guarantee guarantee by the Company Issuer, the Corporation or any of the other Guarantors of Indebtedness of the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries that was permitted to be incurred by another provision of this Section 4.098.7, provided that if the Indebtedness being guaranteed is subordinated to the Debentures, then the Guarantee must be subordinated to the same extent as the Indebtedness guaranteed;
(h12) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, unemployment or other insurance or self-insurance obligations, bankers’ acceptances, performance, completion and surety bonds, completion guarantees and similar obligations in the ordinary course of business;
(13) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a cheque, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(14) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Corporation or such Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn outs or similar obligations, in each case, incurred or assumed in connection with the acquisition, sale or disposition of any business or assets, or Capital Stock of the Corporation or any of its Subsidiaries, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(15) the incurrence of contingent liabilities arising out of endorsements of cheques and other negotiable instruments for deposit or collection in the ordinary course of business;
(16) the incurrence of Indebtedness, consisting of guarantees of loans or other extensions of credit to or on behalf of current or former officers, directors, employees and consultants (and their spouses and estates) of the Corporation or any of its Restricted Subsidiaries for the purpose of permitting such Persons to purchase or redeem Capital Stock of the Corporation or any of its Restricted Subsidiaries or in connection with the exercise by such Persons of stock options of the Corporation or any of its Restricted Subsidiaries and the funding of the exercise price of such stock options, in an aggregate principal amount not to exceed $2 million at any one time outstanding;
(17) Indebtedness of the Corporation or any of its Restricted Subsidiaries to credit card providers, processors or intermediaries in connection with credit card processing or financing services incurred in the ordinary course of business of the Corporation and its Restricted Subsidiaries in an aggregate principal amount not to exceed $25 million;
(18) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness owed to one or more Persons in respect of premium financing or similar deferred payment obligations with respect to insurance policies purchased in the ordinary course of business; and
(19) the incurrence by the Corporation or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any one time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (19), not to exceed $40 million. For purposes of determining compliance with this Section 8.7, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (19) of this Section 8.7, or is entitled to be incurred pursuant to the first paragraph of this Section 8.7, the Corporation shall be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock, in any manner that complies with this Section 8.7. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; 8.7, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges Consolidated Total Debt of the Company Corporation as accrued;
(i) . Notwithstanding any other provision of this Section 8.7, the maximum amount of Indebtedness of that the Company Corporation or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 8.7 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date shall be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueof the Indebtedness, as applicable) at in the case of any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(k3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the incurrence by Fair Market Value of such assets at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(b) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 2 contracts
Samples: Trust Indenture (Wall2wall Media Inc.), Trust Indenture (Wall2wall Media Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall that Holdings will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Issuers may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Holdings' Restricted Subsidiaries may incur Indebtedness or issue shares of preferred stockstock if (i) no Default or Event of Default shall have occurred and be continuing at the time or as a consequence of the incurrence of any such Indebtedness or the issuance of any such Disqualified Stock, if and (ii) the Consolidated Fixed Charge Coverage Ratio for the Company's Holdings' most recently ended four full fiscal quarters 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 Four- Quarter Period would have been at least 2.0 1.75 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such fourFour-quarter periodQuarter Period. The provisions of the first paragraph of this Section 4.09 shall covenant will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtIndebtedness"):
(ai) the incurrence by Holdings of Indebtedness represented by the Debentures issued in the Offering, the incurrence by the Company of Indebtedness represented by the Senior Notes and the incurrence by the Subsidiary Guarantors of the Subsidiary Guarantees of the Senior Notes;
(ii) the incurrence by Holdings and its Restricted Subsidiaries of Indebtedness incurred pursuant to one or more Credit Facilities in an aggregate principal amount at any time outstanding (with letters of credit being deemed to have a principal amount equal to the Existing maximum potential liability of Holdings and its Subsidiaries thereunder) not to exceed the sum of (a) $50.0 million (which amount shall initially be utilized for term Indebtedness;
) plus (b) the incurrence by greater of (I) the Company Borrowing Base or (II) $275.0 million, less, in the case of clauses (a) and (b)(II), taken together, (A) the Guarantors aggregate amount of Indebtedness represented by of Securitization Entities at the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date time outstanding less (B) he amount of this Indenture and the date of the Junior Note Indenture, respectively, all optional or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence mandatory principal payments actually made by the Company or any of its Restricted Subsidiaries since the date of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, this Indenture in each case, respect of term loans under Credit Facilities incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to under this clause (c), not ii) (excluding any such payments to exceed $2.5 million the extent refinanced at the time of payment under a Credit Facility) and (C) further reduced by (X) any time outstandingrepayments of revolving credit borrowings under Credit Facilities that are applied in accordance with Section 4.10 and (Y) any Attributable Debt incurred in pursuant to Section 4.16;
(diii) the incurrence by the Company or any of Holdings and its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or under Currency Agreements;
(iv) the net proceeds incurrence by Holdings and its Restricted Subsidiaries of Existing Indebtedness;
(v) Interest Swap Obligations of Holdings and its Restricted Subsidiaries covering Indebtedness of Holdings and its Restricted Subsidiaries; provided that any Indebtedness to which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was any such Interest Swap Obligations correspond is otherwise permitted by this Indenture to be incurred under this Indenture; and provided, further, that such Interest Swap Obligations are entered into, in the first paragraph judgment of this Section 4.09 or clauses (a)Holdings, (b), (c), (d) or (j) of this paragraphto protect Holdings and its Restricted Subsidiaries from fluctuation in interest rates on its outstanding Indebtedness;
(evi) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Holdings and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor Holdings is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Debentures and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Holdings or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Holdings or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Holdings or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence of Acquired Indebtedness of Restricted Subsidiaries of Holdings to the extent Holdings could have incurred such Indebtedness in accordance with the first paragraph of this covenant on the date such Indebtedness became Acquired Indebtedness;
(viii) Guarantees by Holdings and its Restricted Subsidiaries of each other's Indebtedness; provided that such Indebtedness is permitted to be incurred under this Indenture;
(ix) Indebtedness (including Capitalized Lease Obligations) incurred by Holdings or any of its Restricted Subsidiaries to finance the purchase, lease or improvement of property (real or personal) or equipment (whether through the direct purchase of assets or the Capital Stock of any Person owning such assets) in an aggregate principal amount outstanding not to exceed 5% of Total Assets at the time of any incurrence thereof (including any Refinancing Indebtedness with respect thereto) (which amount may, but need not, be incurred in whole or in part under the Senior Credit Facilities);
(x) the incurrence of Indebtedness (including letters of credit) in respect of workers' compensation claims, self-insurance obligations, performance, surety, bid or similar bonds and completion guarantees provided by Holdings or a Restricted Subsidiary in the ordinary course of business and consistent with past practices;
(xi) Indebtedness arising from agreements of Holdings or a Restricted Subsidiary of Holdings providing for indemnification, adjustment of purchase price, earn out or other similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Restricted Subsidiary of Holdings, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition; provided that the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds actually received by Holdings and its Restricted Subsidiaries in connection with such disposition;
(xii) obligations in respect of performance and surety bonds and completion guarantees provided by Holdings or any Restricted Subsidiary of Holdings in the ordinary course of business;
(xiii) any refinancing, modification, replacement, renewal, restatement, refunding, defeasance, deferral, extension, substitution, supplement, reissuance or resale of existing or future Indebtedness (other than intercompany Indebtedness), including any additional Indebtedness incurred to pay interest or premiums required by the instruments governing such existing or future Indebtedness as in effect at the time of issuance thereof ("Required Premiums") and fees in connection therewith ("Refinancing Indebtedness"); provided that (1) any such event shall not directly or indirectly result in an increase in the aggregate principal amount of Permitted Indebtedness (except to the extent such increase is a result of a simultaneous incurrence of additional Indebtedness (A) to pay Required Premiums and related fees or (B) otherwise permitted to be incurred under this Indenture) of Holdings and its Restricted Subsidiaries, (2) such Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded, (3) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Debentures, such Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the Debentures on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;
(xiv) the incurrence by the Company Holdings or any of its Restricted Subsidiaries of Hedging Obligations additional Indebtedness and/or the issuance of Disqualified Stock in an aggregate principal amount or aggregate liquidation value, as applicable (or accreted value, as applicable), at any time outstanding, including all Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xiv), not to exceed $20 million; and
(xv) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that are incurred is Non-Recourse Debt (except for the purpose of fixing or hedging interest rate risk Standard Securitization Undertakings) with respect to Holdings and its other Restricted Subsidiaries. The Issuers shall also not incur any floating rate Indebtedness (including Permitted Indebtedness) that is permitted by the terms contractually subordinated in right of this Indenture payment to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of other Indebtedness of the Company or a Restricted Subsidiary Issuers unless such Indebtedness is also contractually subordinated in right of payment to the Debentures on substantially identical terms; provided, however, that no Indebtedness of the Company Issuers shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuers solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that was permitted an item of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses (i) through (xv) above or is entitled to be incurred by another provision pursuant to the first paragraph of this Section 4.09;
(h) , the accrual Issuers shall, in their sole discretion, classify such item of Indebtedness in any manner that complies with this Section 4.09. Accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Consolidated Fixed Charges of the Company Holdings as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Anthony Crane Sales & Leasing Lp), Indenture (Anthony Crane Holdings Capital Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Classic shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Classic shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Classic may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Indebtedness or issue preferred stock, if Classic's Debt to Cash Flow Ratio at the Fixed Charge Coverage Ratio for time of incurrence of such Indebtedness or the Company's issuance of such Disqualified Stock or preferred stock, after giving pro forma effect to such incurrence or issuance as of such date and to the use of proceeds therefrom as if the same had occurred at the beginning of the most recently ended four full fiscal quarters three-month period of Classic 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 available, would have been at least 2.0 no greater than 7.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by Classic and any Guarantor of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the Company maximum potential liability of Classic and its Restricted Subsidiaries thereunder) not to exceed $350.0 million;
(2) the incurrence by Classic and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company Classic and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Note Guarantees to be issued on the date of this Indenture hereof and the date of Exchange Notes and the Junior related Note Indenture, respectively, or Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c4) the incurrence by the Company Classic or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsobligations or letters of credit, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company Classic or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed $2.5 15.0 million at any time outstanding;
(d5) the incurrence by the Company Classic or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a2), (b3), (c), (d4) or (j5) of this paragraph;
(e6) the incurrence by the Company Classic or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Classic and any of its Restricted Subsidiaries; provided, however, that:
(ia) if the Company Classic or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the CompanyClassic, or its the Note Guarantee, in the case of a Guarantor; and
(1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Classic or a Restricted Subsidiary of the Company thereof and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Classic or a Restricted Subsidiary of the Company shall Classic, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Classic or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e6);
(f7) the incurrence by the Company Classic or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) 8) the Guarantee guarantee by the Company Classic or any of the Guarantors of Indebtedness of the Company Classic or a Restricted Subsidiary of the Company Classic that was permitted to be incurred by another provision of this Section 4.09;
(h9) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09;
(10) the incurrence of Indebtedness of a Restricted Subsidiary that was outstanding on or prior to the date on which such Restricted Subsidiary was acquired by Classic (other than Indebtedness incurred in connection with, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired by Classic); provided, in each such casehowever, that on the amount thereof is included in Fixed Charges date of such acquisition and after giving effect to that acquisition, the Company as accruedDebt to Cash Flow Ratio would have been less than or equal to the Debt to Cash Flow Ratio immediately prior to that acquisition;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j11) the incurrence by the Company Classic or any of its Restricted Subsidiaries the Guarantors of additional Indebtedness in addition to any Indebtedness described in clauses (including Acquired Debt1) through (10) and (12) of this Section 4.09 in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j11), not to exceed $5.0 25.0 million; and
(k12) the incurrence by the CompanyClassic's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such that event shall will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company Classic that was not permitted by this clause (k12). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k12) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company Classic shall be permitted to classify such item of Indebtedness on the date of its incurrence, incurrence or later 50 57 reclassify all or a portion of such item of Indebtedness, Indebtedness in any manner that complies with this Section 4.09 and the items will be treated as having been incurred pursuant only to the first paragraph or clause (1) through (12) of this Section 4.09. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt.
Appears in 2 contracts
Samples: Indenture (Classic Network Transmission LLC), Indenture (Friendship Cable of Arkansas Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and shall not, and the Company shall not permit any Subsidiary Guarantor to, issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries that are not Subsidiary Guarantors to issue any shares of preferred stockstock (other than Qualified Subsidiary Stock); provided, however, that the Company or any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue shares of preferred stock (including Disqualified Stock) if, and in each case, (1) the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage to Adjusted Operating Cash Flow Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding as of the date on which such additional Indebtedness is incurred or such preferred stock or Disqualified Stock or preferred stock is issued would have been at least 2.0 7.0 to 11 or less, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at as of the beginning date of such four-quarter periodcalculation and (2) no Default or Event of Default would occur as a consequence thereof. The first paragraph of this Section 4.09 Company shall not, and shall not prohibit the incurrence of permit any Subsidiary Guarantor to, incur any Indebtedness that is contractually subordinated to any other Indebtedness of the following items Company or of such Subsidiary Guarantor, as the case may be, unless such Indebtedness is also contractually subordinated to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, on substantially identical terms; provided, however, that no Indebtedness shall be deemed to be contractually subordinated to any other Indebtedness solely by virtue of being unsecured.
(b) The foregoing provisions shall not apply to (collectively, "Permitted Debt"):
(ai) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt or the issuance by such Unrestricted Subsidiaries of preferred stock; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary or any such preferred stock becomes preferred stock (other than Qualified Subsidiary Stock) of a Restricted Subsidiary, as the case may be, such event shall be deemed to constitute an incurrence of Indebtedness by, or an issuance of preferred stock (other than Qualified Subsidiary Stock) of, as the case may be, a Restricted Subsidiary of the Company;
(ii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness pursuant to one or more Bank Facilities if the aggregate principal amount at any time outstanding incurred pursuant to this clause (ii) does not exceed $50.0 million;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors of Indebtedness represented by under the Subordinated Exchange Notes to pay interest on outstanding Subordinated Notes, ;
(v) Indebtedness under the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cvi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (1) if the Company or a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, and (2)(A) any subsequent issuance or transfer of Equity Interests that result in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (B) any sale or other transfer of such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount not to exceed $7.5 million at any time outstanding, including all Permitted Refinancing Indebtedness Debt incurred pursuant to clause (viii) below to refund, replace or refinance or replace any Indebtedness incurred pursuant to this clause (cvii), not to exceed $2.5 million at any time outstanding;
(dviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(eix) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Debt incurred pursuant to clause (viii) above to refund, replace or among the Company and refinance any of its Restricted SubsidiariesIndebtedness incurred pursuant to this clause (ix), not to exceed $7.5 million; provided, however, that:and
(ix) if the guarantee by the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled permitted to be incurred pursuant to Section 4.09(a) hereof and also meets the first paragraph criteria of this Section 4.09one or more of the categories of Permitted Debt described in clauses (i) through (x) above, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and may from time to time reclassify such item of Indebtedness in any manner in which such item could be incurred at the time of such reclassification. For purposes of this paragraph, "Indebtedness" includes Disqualified Stock and preferred stock of Subsidiaries. Accrual of interest and the accretion of accreted value will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Pegasus Communications Corp), Indenture (Pegasus Communications Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and shall not, and the Company shall not permit any Subsidiary Guarantor to, issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries that are not Subsidiary Guarantors to issue any shares of preferred stockstock (other than Qualified Subsidiary Stock); provided, however, that the Company or any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue shares of preferred stock (including Disqualified Stock) if, and in each case, (1) the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage to Adjusted Operating Cash Flow Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding as of the date on which such additional Indebtedness is incurred or such preferred stock or Disqualified Stock or preferred stock is issued would have been at least 2.0 7.0 to 11 or less, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at as of the beginning date of such four-quarter periodcalculation and (2) no Default or Event of Default would occur as a consequence thereof. The first paragraph of this Section 4.09 Company shall not, and shall not prohibit the incurrence of permit any Subsidiary Guarantor to, incur any Indebtedness that is contractually subordinated to any other Indebtedness of the following items Company or of such Subsidiary Guarantor, as the case may be, unless such Indebtedness is also contractually subordinated to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, on substantially identical terms; provided, however, that no Indebtedness shall be deemed to be contractually subordinated to any other Indebtedness solely by virtue of being unsecured.
(b) The foregoing provisions shall not apply to (collectively, "Permitted Debt"):
(ai) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt or the issuance by such Unrestricted Subsidiaries of preferred stock; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary or any such preferred stock becomes preferred stock (other than Qualified Subsidiary Stock) of a Restricted Subsidiary, as the case may be, such event shall be deemed to constitute an incurrence of Indebtedness by, or an issuance of preferred stock (other than Qualified Subsidiary Stock) of, as the case may be, a Restricted Subsidiary of the Company;
(ii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness pursuant to one or more Bank Facilities if the aggregate principal amount at any time outstanding incurred pursuant to this clause (ii) does not exceed $50.0 million;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors of Indebtedness represented by under the Subordinated Exchange Notes to pay interest on outstanding Subordinated Exchange Notes, ;
(v) Indebtedness under the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cvi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (1) if the Company or a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, and (2)(A) any subsequent issuance or transfer of Equity Interests that result in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (B) any sale or other transfer of such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount not to exceed $7.5 million at any time outstanding, including all Permitted Refinancing Indebtedness Debt incurred pursuant to clause (viii) below to refund, replace or refinance or replace any Indebtedness incurred pursuant to this clause (cvii), not to exceed $2.5 million at any time outstanding;
(dviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(eix) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Debt incurred pursuant to clause (viii) above to refund, replace or among the Company and refinance any of its Restricted SubsidiariesIndebtedness incurred pursuant to this clause (ix), not to exceed $7.5 million; provided, however, that:and
(ix) if the guarantee by the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled permitted to be incurred pursuant to Section 4.09(a) hereof and also meets the first paragraph criteria of this Section 4.09one or more of the categories of Permitted Debt described in clauses (i) through (x) above, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and may from time to time reclassify such item of Indebtedness in any manner in which such item could be incurred at the time of such reclassification. For purposes of this paragraph, "Indebtedness" includes Disqualified Stock and preferred stock of Subsidiaries. Accrual of interest and the accretion of accreted value will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Pegasus Communications Corp /), Indenture (Pegasus Satellite Communications Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), other than Permitted Debt, and the Company shall not issue any Disqualified Stock issue, and shall not permit any of its Restricted Subsidiaries to issue issue, any shares of preferred stockDisqualified Stock; provided, however, that the Company or any Guarantor may incur Indebtedness (including Acquired Debt) or the Company or any Guarantor may issue shares of Disqualified Stock, and Stock if the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the such additional Indebtedness had been incurred incurred, or the preferred stock or such Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual . Accrual of interest, the accretion or amortization of original issue discount, accreted value and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that . In the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted case an Unrestricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of incurs Non-Recourse Debt, provided, however, that if Indebtedness and any such Non-Recourse Indebtedness ceases to be Non-Recourse Debt Indebtedness of an such Unrestricted Subsidiary, then such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment subject to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredthis Section 4.09. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness (including Acquired Debt) meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to will, in its sole discretion, classify (or later reclassify) in whole or in part such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness or a portion thereof may be classified (or later reclassified) in whole or in part as having been incurred under more than one of the applicable clauses or pursuant to the first paragraph of this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Tesoro Alaska Co), Indenture (Tesoro Alaska Co)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company and any Guarantor may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries any Guarantor may incur Indebtedness or issue preferred stock, if in each case the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefromtherefrom and as otherwise provided in accordance with the provisions contained in the definition of "Fixed Charge Coverage Ratio"), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company and any Guarantor of Indebtedness pursuant to the Senior Credit Facilities and/or the incurrence by a Securitization Entity of Indebtedness pursuant to a Permitted Securitization Transaction in an aggregate principal amount at any time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries thereunder (provided that letters of credit constituting Standard Securitization Undertakings will be excluded for purposes of this clause (i))) not to exceed $735.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries to permanently repay Indebtedness under the Senior Credit Facilities pursuant to Section 4.10 hereof; provided that the amount of Indebtedness permitted to be incurred pursuant to the Senior Credit Facilities and pursuant to Permitted Securitization Transactions in accordance with this clause (i) shall be in addition to any Indebtedness permitted to be incurred pursuant to the Senior Credit Facilities in reliance on, and in accordance with, clauses (iv) and (xv) below and in addition to any Indebtedness permitted to be incurred pursuant to Permitted Securitization Transactions in reliance on, and in accordance with, clause (xv) below;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture Indenture, the Subsidiary Guarantees of such Notes, the Exchange Notes issued in exchange for such Notes (or in exchange for any Additional Notes issued in accordance with the terms of this Indenture) and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySubsidiary Guarantees thereof;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by (including Capital Lease Obligations) to finance the purchase, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction lease or improvement of property, plant property (real or personal) or equipment used in (whether through the business direct purchase of assets or the Company Capital Stock of any Person owning such assets) within 180 days after such purchase, lease or such Restricted Subsidiary, improvement in an aggregate principal amountamount outstanding (which amount may, but need not, be incurred in whole or in part under the Senior Credit Facilities) not to exceed the greater of (a) $50.0 million or (b) 10.0% of Total Assets at the time of any incurrence thereof, including all any Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 million at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (aii), (biii), (c), (div) or (jxv) of this paragraph;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the obligee is not the Company or any Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guaranteethe Subsidiary Guarantee of such Guarantor, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof; shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred (a) for the purpose of fixing or hedging (1) interest rate risk with respect to any floating or fixed rate Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or (2) the value of foreign currencies purchased or received by the Company in the ordinary course of business or (b) under Commodity Hedging Agreements;
(gviii) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company Company, a Guarantor or a Restricted Foreign Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(hix) the incurrence of Indebtedness and/or the issuance of preferred stock by Foreign Subsidiaries of the Company, which together with the aggregate principal amount of Indebtedness incurred pursuant to this clause (ix) and the aggregate liquidation value of all preferred stock issued pursuant to this clause (ix), does not exceed $40.0 million at any one time outstanding;
(x) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09Stock; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(ixi) Indebtedness incurred by the Company or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business including, without limitation, in respect of workers' compensation claims or self insurance, or other Indebtedness with respect to reimbursement type obligations regarding workers' compensation claims;
(xii) Indebtedness arising from agreements of the Company or a Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price, earn-out or other similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Restricted Subsidiary of the Company, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition; provided that the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(xiii) obligations in respect of performance and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary of the Company in the ordinary course of business;
(xiv) Indebtedness supported by one or more letters of credit incurred under the Senior Credit Facilities in accordance with clause (i); provided the amount of Indebtedness permitted to be incurred under this clause (xiv) relating to any such letter of credit shall not exceed the amount of the letter of credit provided for therein; provided, further, upon any reduction, cancellation or termination of the applicable letter of credit, there shall be deemed to be an incurrence of Indebtedness under the Indenture equal to the extent that excess of the Net Proceeds thereof are promptly:amount of such Indebtedness outstanding immediately after such reduction, cancellation or termination over the remaining stated amount, if any, of such letter of credit or the stated amount of any letter of credit issued in replacement of such letter of credit; and
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jxv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) Indebtedness, and/or the issuance by any Guarantor of preferred stock, in an aggregate principal amount (or accreted value, as applicable) or aggregate liquidation value, as applicable, at any time outstandingoutstanding (which amount may, but need not, be incurred in whole or in part under the Senior Credit Facilities), including all Permitted Refinancing Indebtedness incurred to refund, refinance refi- nance or replace any Indebtedness incurred pursuant or preferred stock issued xursuant to this clause (jxv), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if 50.0 million at any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredone time outstanding. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxv) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, Indebtedness in any manner that complies with this Section 4.09. All borrowings outstanding on the date of this Indenture under the Senior Credit Facilities will be deemed to have been borrowed pursuant to clause (i) of the definition of "Permitted Debt."
Appears in 2 contracts
Samples: Indenture (Dominos Inc), Indenture (Dominos Pizza Government Services Division Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stockstock (except that a Subsidiary of the Company may issue preferred stock to the Company or to any Guarantor); provided, however, that the Company or the Guarantors may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, if such incurrence or issuance is on or prior to September 30, 1999, or 2.25 to 1, if such incurrence or issuance is after September 30, 1999, in each case, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The Company shall not incur any Indebtedness that is contractually subordinated to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated to the Senior Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated to any other Indebtedness of the Company solely by virtue of being unsecured. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company and its Restricted Subsidiaries the Guarantors of Indebtedness (including letters of credit) pursuant to the Credit Facilities (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and the Guarantors thereunder) outstanding under all Credit Facilities after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refinance or replace any Indebtedness incurred pursuant to this clause (i), does not exceed the greater of (a) $40.0 million or (b) the amount of the Borrowing Base minus Indebtedness incurred pursuant to clause (iv) of this Section 4.09;
(ii) the incurrence by the Company and the Guarantors of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Senior Notes (other than any Additional Senior Notes, the Junior Notes ) and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Indebtedness in an aggregate principal amount not to exceed $3.0 million at any time outstanding (x) incurred in connection with the settlement of, or the payment of any judgment with respect to, any outstanding litigation in existence as of the date of this Indenture, which may include the payment of legal fees and expenses relating to such litigation, or (y) represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted SubsidiaryGuarantor; provided, in an aggregate principal amounthowever, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace that any Indebtedness indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;x) shall have been incurred no later than 18 months after the date of this Indenture.
(dv) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiariesthe Guarantors; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company Guarantor and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company Guarantor shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such SubsidiaryGuarantor, as the case may be, that was not permitted by this clause (e);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Hedging Obligations that are incurred for the purpose of fixing or hedging currency exchange risk or interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(kviii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company;
(ix) Indebtedness incurred in respect of performance, surety and similar bonds provided by the Company that was not permitted by this clause in the ordinary course of business, and refinancings thereof;
(k). The Company shall not incur any x) Indebtedness (including Permitted Debt) that is contractually subordinated in right arising from guarantees of payment to any other Indebtedness of the Company unless or any Subsidiary or other agreements of the Company or a Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition, provided that the maximum aggregate liability in respect of all such Indebtedness is also contractually subordinated shall at no time exceed the gross proceeds actually received by the Company and its Subsidiaries in right connection with such disposition;
(xi) the guarantee by any of payment to the Notes on substantially identical terms; provided, however, that no Guarantors of Indebtedness of the Company shall be deemed or another Guarantor that was permitted to be contractually subordinated in right of payment to any other Indebtedness of incurred under this Indenture; and
(xii) the incurrence by the Company solely by virtue or any of being unsecuredits Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, not to exceed $10.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof. Accrual of interest and the accretion of accreted value shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Varsity Spirit Corporation), Indenture (Riddell Sports Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) or issue Disqualified Stock, and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock except for preferred stock issued to and held by the Company or any Wholly-Owned Restricted Subsidiary of the Company, provided that any subsequent issuance or transfer of Capital Stock that results in such Wholly-Owned Restricted Subsidiary ceasing to be a Wholly-Owned Restricted Subsidiary of the Company or any subsequent transfer of such preferred stock (other than to the Company or any of its Wholly-Owned Restricted Subsidiaries) will be deemed, in each case, to constitute the issuance of such preferred stock by the issuer thereof; provided, however, that the Company or any Subsidiary Guarantor may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, Stock and the Company's Subsidiaries any Subsidiary Guarantor may incur Indebtedness or issue preferred stockstock if, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding on the date on which of such additional Indebtedness is incurred incurrence or such Disqualified Stock or preferred stock is issued would have been at least issuance and after giving effect thereto, the Consolidated Leverage Ratio does not exceed 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;1.0.
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;The foregoing provisions will not apply to:
(ci) the incurrence by the Company or any of its Restricted Subsidiaries Subsidiary of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 15.0 million at any time outstandingin the aggregate since the Issue Date;
(dii) the existence of Warehouse Facilities, regardless of amount, and the incurrence of Permitted Warehouse Debt by the Company or any of its Restricted Subsidiaries Subsidiaries; provided, however, that to the extent any such Indebtedness of the Company or a Restricted Subsidiary of the Company ceases to constitute Permitted Refinancing Warehouse Debt, to such extent such Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture shall be deemed to be incurred under by the first paragraph Company or such Restricted Subsidiary of this Section 4.09 or clauses (a)the Company, (b)as the case may be, (c), (d) or (j) of this paragraphat such time;
(eiii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among owing to the Company and or any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1x)(A) any subsequent issuance or transfer of Equity Interests that any Capital Stock which results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company Company, shall be deemed, in each case, to constitute an the incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, and (y) any Indebtedness of the Company to any Restricted Subsidiary is permitted by Section 4.7 hereof;
(iv) the incurrence by the Company of Indebtedness represented by the Notes and the incurrence by the Subsidiary Guarantors of Guarantees;
(v) Indebtedness of the Company and its Restricted Subsidiaries outstanding on the Issue Date;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness with respect to Indebtedness that was not permitted by this clause (e)Indenture to be incurred or that was outstanding at the Issue Date;
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect directly related to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gw) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted by this Indenture to be incurred, (x) Receivables held by the Company or a Restricted Subsidiary pending sale in a Securitization, (y) Receivables of the Company or a Restricted Subsidiary that have been sold pursuant to a Warehouse Facility; or (z) Receivables that the Company or a Restricted Subsidiary reasonably expects to purchase or commit to purchase, finance or accept as collateral; provided, however, that, in the case of each of the foregoing clauses (w) through (z), such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company and its Restricted Subsidiaries on the Issue Date;
(viii) the incurrence of Acquired Debt by the Company or any Subsidiary Guarantor in a principal amount not to exceed $15.0 million in the aggregate since the Issue Date (reduced by the amount of Acquired Debt repaid with Net Proceeds of Asset Sales of the Restricted Subsidiary acquired subject to such Acquired Debt) that is without recourse to the Company or any of its Restricted Subsidiaries or any of their respective assets (other than the Subsidiary Guarantor acquired subject to such Acquired Debt), and is not guaranteed by any such Person;
(ix) the Guarantee by the Company or any of the Subsidiary Guarantors of the Indebtedness of the Company or another Subsidiary Guarantor that was permitted to be incurred by another provision of this Section 4.094.9;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jx) the incurrence by the Company or any and the Subsidiary Guarantors of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), outstanding not to exceed $5.0 10.0 million; and
(kA) the incurrence by an Unrestricted Subsidiary of the Company's Unrestricted Subsidiaries Company of Non-Recourse DebtDebt (including, without limitation, Non-Recourse Debt that would constitute Permitted Warehouse Debt if incurred by a Restricted Subsidiary of the Company); provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an the Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary and (B) the issuance by an Unrestricted Subsidiary of the Company that was not permitted by this clause of preferred stock.
(k). c) The Company shall not, and shall not permit any Subsidiary Guarantor to, incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or any such Subsidiary Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes Notes, or the Subsidiary Guarantee of such Subsidiary Guarantor (as applicable), on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. unsecured or of limited recourse.
(d) For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt Indebtedness described in clauses (ai) through (kxi) above, of Section 4.9(b) above or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.9(a), the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant and such item of Indebtedness will be treated as having been incurred pursuant to only one of such clauses or pursuant to Section 4.094.9(a).
Appears in 2 contracts
Samples: Indenture (Df Special Holdings Corp), Indenture (Delta Financial Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur",” with “incurrence” having a correlative meaning) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or and issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or (including Acquired Debt) and issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 issued, as the case may be, would have been at least 2.0 2.25 to 11.0, 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 or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this .
(b) Notwithstanding the foregoing, Section 4.09 shall 10.11(a) will not prohibit the incurrence of any of the following (the items of Indebtedness (collectively, "described below in this Section 10.11(b) being referred to collectively as “Permitted Debt"”):
(ai) the incurrence by the Company and any Restricted Subsidiary of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (i) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the greater of (x) $1.1 billion and (y) 20% of Adjusted Consolidated Net Tangible Assets, determined as of the date of the incurrence of such Indebtedness after giving pro forma effect to such incurrence and the application of the proceeds therefrom;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes or the Guarantees of the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued incurred by the Company or any of the Guarantors on the date of this Indenture and the date Issue Date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyNotes;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 50.0 million at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance refinance, replace, defease or replace discharge Indebtedness (other than intercompany Indebtedness) or Disqualified Stock of the Company, or Indebtedness (other than intercompany Indebtedness) or preferred stock of a Restricted Subsidiary, in each case that was permitted by this Indenture to be incurred or issued under the first paragraph Section 10.11(a) or clause (ii), (iii), (iv), (v) or (x) of this Section 4.09 or clauses (a10.11(b), (b), (c), (d) or (j) of this paragraph;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of Hedging Obligations shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that are incurred results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary; and
(B) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (vii);
(viii) the incurrence of obligations of the Company or a Restricted Subsidiary pursuant to Interest Rate and Currency Xxxxxx, in each case entered into in the ordinary course of business for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness limiting risks that is permitted by arise in the terms ordinary course of this Indenture to be outstandingbusiness of the Company and its Restricted Subsidiaries;
(gix) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the guarantee shall be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(hx) Permitted Acquisition Indebtedness;
(xi) the incurrence by the Company or any Restricted Subsidiary of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(xii) Indebtedness consisting of the financing of insurance premiums in customary amounts consistent with the operations and business of the Company and the Restricted Subsidiaries;
(xiii) the incurrence by the Company or any Restricted Subsidiary of Indebtedness arising from agreements of the Company or any of its Restricted Subsidiaries providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Capital Stock of a Subsidiary, provided that the maximum aggregate liability in respect of all such Indebtedness shall at no time exceed the gross proceeds actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(xiv) the incurrence by the Company or any Restricted Subsidiary of Indebtedness arising from Guarantees of Indebtedness of joint ventures at any time outstanding not to exceed the greater of $50.0 million and 1.0% of Adjusted Consolidated Net Tangible Assets determined as of the date of incurrence of such Indebtedness after giving pro forma effect to such incurrence and the application of proceeds thereof; and
(xv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in an aggregate principal amount (or accreted value, as applicable) that, when taken together with all other Indebtedness of the Company outstanding on the date of such incurrence (other than Indebtedness permitted by clauses (i) through (xiv) above or Section 10.11(a)) does not exceed the greater of (x) 2.5% of Adjusted Consolidated Net Tangible Assets determined as of the date of incurrence of such Indebtedness and (y) $125.0 million.
(c) For purposes of determining compliance with this Section 10.11, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xv) of Section 10.11(b), or is entitled to be incurred pursuant to Section 10.11(a), the Company will be permitted to divide and classify such item of Indebtedness on the date of its incurrence, or later divide and reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 10.11. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not will be deemed not to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09covenant; provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jd) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09any U.S. dollar-denominated restriction on the incurrence of Indebtedness and issuance of preferred stock, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred, in the event that an item case of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) aboveterm Indebtedness, or first committed, in the case of revolving credit Indebtedness; provided that if such Indebtedness is entitled incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be incurred pursuant to exceeded if calculated at the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness relevant currency exchange rate in effect on the date of its incurrencesuch refinancing, or later reclassify all or a portion such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such item refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced. Notwithstanding any other provision of this Section 10.11, the maximum amount of Indebtedness that the Company may incur pursuant to this Section 10.11 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Permitted Refinancing Indebtedness incurred to refinance other Indebtedness, if incurred in any manner a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Permitted Refinancing Indebtedness is denominated that complies with this Section 4.09is in effect on the date of such refinancing.
Appears in 2 contracts
Samples: Tenth Supplemental Indenture (Plains Exploration & Production Co), Ninth Supplemental Indenture (Plains Exploration & Production Co)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Issuers shall not issue any Disqualified Stock and shall not permit any of its their Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company Issuers and its Restricted their Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors Issuers of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySubordinated Notes;
(c) with respect to lease or rental commitments to lessees (i) existing as of the date hereof or (ii) permitted to be incurred by Foreign Subsidiaries after the date hereof in accordance with Section 4.12, the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, obligations incurred for the purpose of financing all or any part of the purchase price or cost of construction equipment leased or improvement sold to, or otherwise financed for, a customer of property, plant or equipment used in the business of the Company Issuers or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 10.0 million at any time outstanding;
(d) the incurrence by (i) the Company Issuers or any of its Restricted their Subsidiaries or (ii) with respect to clause (b) of this Section 4.09, the Issuers, of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d), (g), (i) or (jk) of this paragraph;
(e) the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of intercompany Indebtedness between or among the Company Issuers and any of its Restricted their Subsidiaries; provided, however, that:
(i) if either the Company or any Guarantor NLC is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuers or a Restricted Subsidiary of the Company Issuers and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Company, NLC or a Restricted Subsidiary of the Company Issuers shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Issuers or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or for the purpose of fixing or hedging currency risk;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(ih) Indebtedness of the Company Issuers or any Restricted Subsidiary to the extent that the Net Proceeds net proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 2 contracts
Samples: Indenture (Comdisco Holding Co Inc), Indenture (Comdisco Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall not directly or indirectly:
(1) Incur any Indebtedness or issue any Disqualified Capital Stock, other than Permitted Indebtedness, or
(2) cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt), and the Company shall not or issue any Disqualified Capital Stock and shall not permit any of its Subsidiaries to issue any shares of or preferred stock; provided, howeverin each case, that other than Permitted Indebtedness.
(b) Notwithstanding the foregoing limitations, the Company may incur issue Disqualified Capital Stock, and any Obligor may Incur Indebtedness (including including, without limitation, Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding if:
(1) no Default or Event of Default shall have occurred and be continuing on the date on which of the proposed Incurrence or issuance or would result as a consequence of such additional Indebtedness is incurred proposed Incurrence or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1issuance, determined on a and
(2) immediately after giving pro forma basis (including a pro forma effect to such proposed Incurrence or issuance and the receipt and application of the net proceeds therefrom), as if the additional Company’s Consolidated Coverage Ratio would not be less than 2.00:1.00. Any Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, of any Person existing at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or it becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition of the Company and (2capital stock or otherwise) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness Incurred as of the Company solely by virtue of being unsecureddate such Person becomes a Restricted Subsidiary. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt Indebtedness described in clauses (a1) through (k15) above, of such definition or is entitled to be incurred Incurred pursuant to the first paragraph of this Section 4.094.09(b), the Company shall be permitted to will, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09and such item of Indebtedness will be treated as having been Incurred pursuant to only one of such clauses or pursuant to Section 4.09(b). The Company may reclassify such Indebtedness from time to time in its sole discretion and may classify any item of Indebtedness in part under one or more of the categories of Permitted Indebtedness and/or in part as Indebtedness entitled to be Incurred pursuant to Section 4.09(b). Accrual of interest, the accretion of principal amount and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms will not be deemed to be an Incurrence of Indebtedness for purposes of this Section.
Appears in 2 contracts
Samples: Indenture (Casino One Corp), Indenture (Pinnacle Entertainment Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock Interests and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockEquity Interests (including Disqualified Interests); providedPROVIDED, howeverHOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, Interests and any of the Company's Restricted Subsidiaries that is a Guarantor may incur Indebtedness or issue preferred stockEquity Interests (including Disqualified Interests) if, if in each case, the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 Equity Interests are issued would have been at least 2.0 2 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock Equity Interests had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 Company shall not prohibit incur any Indebtedness (nor will the Guarantors guarantee any such Indebtedness) that is contractually subordinated to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; PROVIDED, HOWEVER, that no Indebtedness of the Company shall be deemed to be contractually subordinated to any other Indebtedness of the Company solely by virtue of being unsecured. The foregoing provisions shall not apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company (and the guarantee thereof by the Guarantors) of revolving credit Indebtedness and letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries thereunder) under Credit Facilities; PROVIDED that the aggregate principal amount of all revolving credit Indebtedness and letters of credit outstanding under Credit Facilities after giving effect to such incurrence does not exceed an amount equal to $50.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company Issuers (and the Guarantors Guarantee thereof by the Guarantors) of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount not to exceed $5.0 million at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; PROVIDED that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the Company or one of its Restricted Subsidiaries and was not incurred in connection with, including all or in contemplation of, such acquisition by the Company or one of its Restricted Subsidiaries; and PROVIDED FURTHER that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (v) and any Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (cv), does not to exceed $2.5 million at any time outstanding10 million;
(dvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) or any Indebtedness that was permitted by this the Indenture to be incurred under pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph4.09;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly-Owned Restricted Subsidiaries; providedPROVIDED, howeverHOWEVER, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly-Owned Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gix) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(kx) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, providedPROVIDED, howeverHOWEVER, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (kx). The ;
(xi) Indebtedness consisting of Permitted Investments of the kind described in clause (f) of the definition of "Permitted Investments"; and
(xii) the incurrence by the Company shall not incur or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (including Permitted Debt) that is contractually subordinated in right of payment xii), not to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredexceed $5.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends or Disqualified Interests in the form of additional shares of the same class of Disqualified Interests shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09; PROVIDED, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
Appears in 2 contracts
Samples: Indenture (Restaurant Co), Indenture (Perkins Finance Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) ), or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries Subsidiary Guarantors may incur Indebtedness or issue preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.5 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall foregoing provisions will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company or the Subsidiary Guarantors of Indebtedness (including letters of credit, with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) under the Senior Credit Facility; provided that the aggregate principal amount of all Indebtedness (including letters of credit) outstanding under the Senior Credit Facility after giving effect to such incurrence does not exceed an amount equal to $100.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied to permanently repay any such Indebtedness pursuant to Section 4.10 hereof;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company of Indebtedness represented by the Notes and the Exchange Notes and the incurrence by the Subsidiary Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 5.0 million at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that is either the Existing Indebtedness or was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 hereof or clauses (aii), (biii), (civ), (dv) or (jix) of this paragraph;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries a Subsidiary Guarantor of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gviii) the Guarantee guarantee by the Company or any of the Subsidiary Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company Guarantor that was permitted to be incurred by another provision of this Section 4.09;
(hix) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition by the Company or a Restricted Subsidiary of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to such acquisition by the extent Company or a Restricted Subsidiary and was not incurred in connection with, or in contemplation of, such acquisition by the Company or a Restricted Subsidiary; and provided further that the Net Proceeds thereof are promptly:principal amount of such Indebtedness does not exceed $5.0 million at any time outstanding;
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jx) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jx), not to exceed $5.0 10.0 million; and
(kxi) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (kxi). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09covenant, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09covenant. Accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
Appears in 2 contracts
Samples: Indenture (Prime Medical Services Inc /Tx/), Indenture (Sun Medical Technologies Inc /Ca/)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Subsidiary Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 shall 4.09(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(1) the incurrence (A) by the Company and the guarantee by the Subsidiary Guarantors of additional Indebtedness and letters of credit under Credit Facilities and (B) by Securitization Entities of Indebtedness in Qualified Securitization Transactions in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (1), not to exceed the greater of:
(a) $3.0 billion; or
(b) $3.73 billion less the sum, without duplication, of:
(i) the aggregate amount of all repayments, optional or mandatory, of the principal of any term Indebtedness under a Credit Facility (other than repayments under Credit Facilities of Excluded Subsidiaries, REMA and its Subsidiaries or the Xxxxxx Subsidiary ) that have been made by the Company or any of its Restricted Subsidiaries since the Issue Date;
(ii) the aggregate amount, without duplication, of all commitment reductions with respect to any revolving credit borrowings under a Credit Facility that have been made by the Company or any of its Restricted Subsidiaries (other than Credit Facilities of Excluded Subsidiaries, REMA and its Subsidiaries or the Xxxxxx Subsidiary) since the Issue Date; and
(iii) the aggregate principal amount of Indebtedness incurred pursuant to clause (5) of this Section 4.09(b) (including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to such clause (5)) that is at the time outstanding;
(2) [Reserved];
(3) [Reserved];
(4) the incurrence by REMA and its Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities of REMA or any of its Subsidiaries in an aggregate principal amount at any one time outstanding under this clause (4) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of REMA and its Subsidiaries thereunder), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (4), not to exceed $60.0 million;
(5) the incurrence by the Company and/or the Xxxxxx Subsidiary of (A) Permitted PEDFA Bond Indebtedness (including the Bonds) and/or the guarantee thereof by the Company and/or the Subsidiary Guarantors (including the Xxxxxx Xxxx Guarantees) or (B) Indebtedness evidenced by or in support of the Xxxxxx Tax-Exempt Bonds, in an aggregate principal amount at any one time outstanding under this clause (5), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (5), without duplication, not to exceed $600.0 million less the aggregate amount of all repayments, optional or mandatory, of the principal of any Indebtedness incurred pursuant to this clause (5) that have been made by the Company and/or the Subsidiary Guarantors and/or the Xxxxxx Subsidiary since the Issue Date;
(6) [Reserved];
(7) [Reserved];
(8) the issuance of Specified Junior Securities by the Company, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (8); provided that at least 50% of the net proceeds of such issuance (other than proceeds that are used by the Company or any Subsidiary Guarantor to acquire Permitted ERCOT Assets) are applied to the repayment of term Indebtedness under the Company's Credit Facilities; provided, further, that if there is any change in the terms of such Specified Junior Securities that results in such securities no longer meeting all of the requirements of the definition of "Specified Junior Securities," then such change will be deemed to constitute an incurrence of Indebtedness by the Company that was not permitted by this clause (8);
(9) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness, including the Existing Convertible Notes, the Existing Notes, Reliant Energy Channelview's Indebtedness, Orion Power Holdings, Inc.'s Senior Notes due 2010 and Indebtedness under the REMA Lease, and including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (9);
(b10) the incurrence by the Company and the Subsidiary Guarantors of Indebtedness represented by the Notes, the Junior 2014 Notes and the related Subsidiary 2014 Note Guarantees to be issued on the date of this Indenture Issue Date and the date incurrence by any Restricted Subsidiary of the Junior Company of any other 2014 Note IndentureGuarantee of the 2014 Notes, respectivelyincluding all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyclause (10);
(c11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c11), not to exceed $2.5 100.0 million at any one time outstanding;
(d12) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) hereof or clauses (1), (4), (5), (8), (9), (10), (11), (12) or (21) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e13) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(ia) if the Company or any Subsidiary Guarantor is the obligor on such IndebtednessIndebtedness and (i) the payee is not the Company or a Subsidiary Guarantor or (ii) such Indebtedness constitutes Excluded Securities, such Indebtedness (except Permitted PEDFA Bond Indebtedness) must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the NotesREI Guarantee, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a Subsidiary Guarantor; and
(1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company (except transfers to the Collateral Trustee to secure Secured Obligations) shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e13);
(f14) the incurrence by any Subsidiary Guarantor of any Guarantee of Parity Secured Debt or any other Obligation that guarantees, secures or supports, Equally and Ratably, all of the Parity Secured Debt and Parity Secured Obligations;
(15) the issuance by any of the Company's Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, shall be deemed, in each case, to constitute an issuance of such preferred stock by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (15);
(16) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(g17) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, self-insurance obligations, bankers' acceptances, performance and surety bonds provided by the Company or a Restricted Subsidiary in the ordinary course of business;
(18) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five business days;
(19) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Equity Interests of a Subsidiary; provided that the maximum aggregate liability in respect of all such Indebtedness shall at no time exceed the gross proceeds (including non-cash proceeds) actually received by the Company and/or such Restricted Subsidiary in connection with such disposition;
(20) the Guarantee by the Company or any of the Guarantors Subsidiary Guarantor of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision Section 4.09(a) hereof or clauses (8), (11) or (21) of this Section 4.09;4.09(b); and
(h21) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding pursuant to this clause (21), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (21), not to exceed $500.0 million (which may, but need not, be incurred under a Credit Facility). The Company shall not, and shall not permit any Subsidiary Guarantor to, incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or that Subsidiary Guarantor (except Permitted PEDFA Bond Indebtedness) unless such Indebtedness is also contractually subordinated in right of payment to the REI Guarantee or the applicable Subsidiary Guarantee on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured or by virtue of being secured on a junior basis. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (21) of Section 4.09(b) hereof, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify from time to time all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under Credit Facilities outstanding on the Issue Date shall initially be deemed to have been incurred on such date in reliance on the exception provided by clauses (1), (4) and (9) of Section 4.09(b) hereof, as applicable, and all Permitted PEDFA Bond Indebtedness, including the Bonds, the Loan Agreements and the Xxxxxx Xxxx Guarantees, and other Indebtedness evidenced by or in support of the Xxxxxx Tax-Exempt Bonds outstanding on the Issue Date shall initially be deemed to have been incurred on such date in reliance on the exception provided by clause (5) of Section 4.09(b) hereof. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) . Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness of that the Company or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 4.09 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereofexchange rates or currency values.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 2 contracts
Samples: Guarantee Agreement (Reliant Energy Inc), Guarantee Agreement (Reliant Energy Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any of the Guarantors may incur Indebtedness (including Acquired Debt) or ), the Company may issue shares of Disqualified Stock, Stock and the Company's Subsidiaries may incur Indebtedness or issue shares of preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or Subsidiary preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or Subsidiary preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of apply to the following items of Indebtedness (which, collectively, shall constitute "Permitted Debt"):
(ai) the incurrence by the Company of Indebtedness under Credit Facilities and the Guarantee thereof by the Guarantors; provided that the aggregate principal amount of all Indebtedness (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries thereunder) outstanding under all Credit Facilities after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (i), does not exceed an amount equal to the greater of (x) $200.0 million less the aggregate amount of all Net Proceeds of Asset Sales that have been applied since the date of this Indenture to repay Indebtedness pursuant to Section 4.10 hereof and (y) the Borrowing Base;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors its Subsidiaries of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any one time outstanding under this clause (iv), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 million at any time outstanding5.0 million;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Wholly Owned Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Wholly Owned Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Wholly Owned Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingincurred;
(gviii) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant;
(hix) the accrual of interestextensions, the accretion renewals or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares replacements of the same class Existing Guarantees on terms that are no less favorable to the Holders of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes Notes than those existing on the date of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedIndenture;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jx) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstandingoutstanding under this clause (x), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jx), not to exceed $5.0 million; and;
(kxi) the incurrence by the Company's Unrestricted Company or any of its Subsidiaries of Non-Recourse DebtIndebtedness incurred in respect of performance, provided, however, that if surety and similar bonds provided by the Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an its Subsidiaries in the ordinary course of business; and
(xii) the incurrence by the Company or any of its Subsidiaries of Indebtedness by a Restricted Subsidiary in respect of letters of credit relating to workers' compensation claims and self-insurance or similar requirements in the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right ordinary course of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredbusiness. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify or reclassify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09, and at any given time such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09. The Company shall not be deemed to be in breach of this Section 4.09 solely as the result of fluctuations in currency exchange rates.
Appears in 2 contracts
Samples: Indenture (Amcraft Building Products Co Inc), Indenture (Amcraft Building Products Co Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company Issuer shall not, and shall not permit any of its Subsidiaries Restricted Subsidiary to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries Restricted Subsidiary to issue any shares of preferred stock; provided, however, that the Company Issuer and the Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or issue shares of preferred stock, if if, after giving effect thereto and the application of the proceeds therefrom, either (i) the Fixed Charge Coverage Ratio for the Company's Issuer’s most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, would have been at least 2.0 to 1.0, or (ii) the beginning Indebtedness to Consolidated Tangible Net Worth Ratio as of the end of the Issuer’s most recently ended fiscal quarter for which internal financial statements are available immediately preceding the date on which such four-quarter period. The first paragraph of this additional Indebtedness is incurred or such preferred stock is issued, as the case may be, would have been less than or equal to 1.50 to 1.0.
(b) Section 4.09 4.10(a) shall not prohibit the incurrence of any of Indebtedness that meets the following items criteria or the issuance of Indebtedness any preferred stock that meets the following criteria, as applicable (collectively, "“Permitted Debt"”):
(a1) the incurrence by the Company and its Issuer or any Restricted Subsidiaries Subsidiary of the Existing Indebtedness;
(b) the incurrence Indebtedness pursuant to Credit Facilities, including any Guarantee of such Indebtedness by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace amount at any Indebtedness incurred pursuant to this clause (c), one time outstanding not to exceed the greater of $2.5 380.0 million and 25.0% of Consolidated Tangible Assets at any the time outstandingof incurrence;
(d2) the Existing Indebtedness;
(3) the incurrence by the Company Issuer of Indebtedness represented by the Initial Notes issued on the Issue Date (and the incurrence by any Subsidiary Guarantor of any related Note Guarantee);
(4) the incurrence or issuance by the Issuer or any Restricted Subsidiary of its Permitted Purchase Money Indebtedness, together with Permitted Refinancing Indebtedness in respect thereof, in an aggregate amount at any one time outstanding not to exceed the greater of $25.0 million and 2.5% of Consolidated Tangible Assets at the time of incurrence;
(5) the incurrence by the Issuer or any Restricted Subsidiaries Subsidiary of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used incurred to extend, renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.10(a), this clause (5) or clause (2), (3) or (11) of this Section 4.09 or clauses (a4.10(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company Issuer or any Restricted Subsidiary of its Hedging Obligations not for speculative purposes;
(7) the incurrence by the Issuer or any Restricted Subsidiary of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, letters of credit, performance bonds, completion bonds, bid bonds, surety bonds, appeal bonds, performance, completion and compliance guarantees or other similar obligations incurred in the ordinary course of business; provided that upon the drawing of letters of credit for reimbursement obligations, or the incurrence of other reimbursement-type Indebtedness with respect to the foregoing, such obligations are reimbursed within 30 days following such drawing or incurrence;
(8) the incurrence by the Issuer or any Restricted Subsidiary of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, so long as such Indebtedness is extinguished within five Business Days;
(9) the incurrence of Indebtedness arising from agreements of the Issuer or a Restricted Subsidiary providing for indemnification, adjustment of purchase price, holdback, contingency payment obligations or similar obligations, in each case, incurred or assumed in connection with the disposition or acquisition of any business, assets or Equity Interests of the Issuer or any such Restricted Subsidiary;
(10) the incurrence of Indebtedness resulting from endorsements of negotiable instruments for collection in the ordinary course of business;
(11) Acquired Debt or Indebtedness or preferred stock of the Issuer or any Restricted Subsidiary incurred to provide all or a portion of the funds utilized to acquire Persons that are acquired by the Issuer or any Restricted Subsidiary (including by way of merger, amalgamation or consolidation) in accordance with the terms of this Indenture; provided that immediately after giving effect to such acquisition, any of the following is true:
(a) the Issuer would be permitted to incur at least $1.00 of additional Indebtedness pursuant to Section 4.10(a);
(b) the Issuer’s Fixed Charge Coverage Ratio after giving pro forma effect to such acquisition would be greater than or equal to the Issuer’s actual Fixed Charge Coverage Ratio immediately prior to such acquisition; or
(c) the Issuer’s Indebtedness to Consolidated Tangible Net Worth Ratio after giving pro forma effect to such acquisition would be less than or equal to the Issuer’s actual Indebtedness to Consolidated Tangible Net Worth Ratio immediately prior to such acquisition;
(12) Indebtedness of the Issuer or any Restricted Subsidiary in respect of netting services, overdraft protection and otherwise in connection with deposit accounts; provided that such Indebtedness remains outstanding for ten Business Days or less;
(13) the incurrence or issuance by the Issuer or any Restricted Subsidiary of Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, not to exceed the greater of $50.0 million and 3.5% of Consolidated Tangible Assets of the Issuer at the time of incurrence;
(14) the incurrence of guarantees by the Issuer or any Restricted Subsidiary in the ordinary course of business in respect of obligations to suppliers, customers, franchisees, lessors and licensees of the Issuer or any Restricted Subsidiary;
(15) the incurrence of Indebtedness by the Issuer or any Restricted Subsidiary in respect of obligations to pay the deferred purchase price of goods or services or progress payments in connection with such goods and services; provided that such obligations are incurred in connection with open accounts extended by suppliers on customary trade terms (which require that all such payments be made within 60 days after the incurrence of the related obligation) in the ordinary course of business and not in connection with the borrowing of money or any Hedging Obligations;
(16) Indebtedness of the Issuer or any Restricted Subsidiary consisting of (a) the financing of insurance premiums or (b) take-or-pay obligations contained in supply arrangements, in each case in the ordinary course of business;
(17) the incurrence of Indebtedness by the Issuer or any Restricted Subsidiary deemed to exist pursuant to the terms of a joint venture agreement as a result of the failure of the Issuer or any Restricted Subsidiary to make a required capital contribution therein;
(18) obligations of the Issuer or any Restricted Subsidiary under an agreement with any governmental authority or adjoining (or common masterplan) landowner, in each case entered into in the ordinary course of business in connection with the acquisition of real property, to entitle, develop or construct infrastructure thereupon;
(19) Indebtedness consisting of Indebtedness issued by the Issuer or any Restricted Subsidiary to any current or former officer, director, employee or consultant of the Issuer or any Restricted Subsidiary, in each case to finance the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Issuer to the extent described in Section 4.08(b)(4);
(20) Guarantees issued from time to time by the Issuer or any Restricted Subsidiary of Indebtedness incurred by any joint venture (including any joint venture that is an Unrestricted Subsidiary) in which the Issuer or any Restricted Subsidiary has an equity Investment (or incurred by any Subsidiaries of such joint ventures), in an amount not to exceed at any time outstanding the greater of $25.0 million and 2.5% of Consolidated Tangible Assets of the Issuer at the time of incurrence;
(21) the incurrence by the Issuer or any Restricted Subsidiary of intercompany Indebtedness between or among the Company Issuer and any of its the Restricted Subsidiaries; provided, however, that:
(ia) if the Company Issuer or any Subsidiary Guarantor is the obligor on such IndebtednessIndebtedness and the obligee is not the Issuer or a Subsidiary Guarantor, such Indebtedness must be expressly unsecured and subordinated in right of payment to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the CompanyIssuer, or its the Note Guarantee, in the case of a Subsidiary Guarantor; and
(1b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuer or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Issuer or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an a new incurrence of such Indebtedness by the Company Issuer or such Restricted Subsidiary, as the case may be, that was which new incurrence is not permitted by this clause (e21);
(f22) the incurrence issuance by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptlyIssuer or to any other Restricted Subsidiary of shares of preferred stock; provided, that:
(ia) used to purchase Notes tendered any subsequent issuance or transfer of Equity Interests that results in an offer to purchase made as any such preferred stock being held by a result of Person other than the Issuer or a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionSubsidiary; and
(kb) the incurrence by the Company's Unrestricted Subsidiaries any sale or other transfer of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases preferred stock to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Person that is not either the Issuer or a Restricted Subsidiary shall be deemed, in each case, to constitute a new issuance of the Company that was such preferred stock by such Restricted Subsidiary, which new issuance is not permitted by this clause (k22). The Company shall not incur ;
(23) Guarantees by (a) the Issuer or any Subsidiary Guarantor of Indebtedness (including Permitted Debt) permitted to be incurred by the Issuer or any Restricted Subsidiary in accordance with the provisions of this Indenture; provided that in the event such Indebtedness that is contractually subordinated in right of payment to any other Indebtedness of being Guaranteed is Subordinated Indebtedness, then the Company unless such Indebtedness is also contractually related Guarantee shall be subordinated in right of payment to the Notes on substantially identical termsor the Note Guarantee, as the case may be, and (b) Non-Guarantors of Indebtedness incurred by other Non-Guarantors in accordance with the provisions of this Indenture;
(24) the incurrence by the Issuer or any Restricted Subsidiary of Permitted Nonrecourse Indebtedness; providedand
(25) the incurrence by the Issuer or any Restricted Subsidiary of obligations with respect to homeowners association obligations, howevercommunity facility district bonds, that no Indebtedness metro district bonds, xxxxx-xxxx bonds and subdivision improvement bonds and similar bonding requirements arising in the ordinary course of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. business.
(c) For purposes of determining compliance with this Section 4.094.10, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (aSection 4.10(b)(1) through (k25) above, or is entitled to can be incurred pursuant to the first paragraph of this Section 4.094.10(a), the Company shall Issuer will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify (based on circumstances existing at the time of such reclassification), all or a portion of such item of Indebtedness, in any manner that complies with Section 4.10(a) or Section 4.10(b).
(d) For purposes of Section 4.10(b)(21) and (22), the existence of a Permitted Lien on Equity Interests, Indebtedness or preferred stock shall not be considered a transfer until the Equity Interests, Indebtedness or preferred stock securing such Permitted Lien has been foreclosed upon.
(e) For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness; provided that if such Indebtedness is incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced, any committed amounts associated with revolving credit Indebtedness (if the Issuer elected to have such commitment deemed to be incurred at the time of the commitment in accordance with the last paragraph of the definition of “incur”), plus accrued interest and premium (including tender premium) thereon, original issue discount on, and underwriting discounts, fees, commissions and expenses incurred in connection with, such refinancing. Notwithstanding any other provision of this Section 4.094.10, the maximum amount of Indebtedness that the Issuer and the Restricted Subsidiaries may incur pursuant to this Section 4.10 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate or currency values. The principal amount of any Indebtedness incurred to refinance other Indebtedness, if incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such refinancing Indebtedness is denominated that is in effect on the date of such refinancing.
Appears in 2 contracts
Samples: Indenture (Forestar Group Inc.), Indenture (Forestar Group Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their respective Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company Issuers shall not issue any Disqualified Stock and shall not permit any of its their respective Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) Issuers or issue Disqualified Stock, and the Company's Subsidiaries any Guarantor may incur Indebtedness or issue shares of preferred stock, stock if the Fixed Charge Coverage Ratio of Consoltex Group for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period: provided further that no guarantee may be incurred pursuant to the provisions of this paragraph, unless the guaranteed Indebtedness is also incurred pursuant to this paragraph. The first paragraph of this Section 4.09 foregoing limitations shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
apply to (a) the incurrence by either Issuer or any Guarantor of Indebtedness pursuant to the Company and its Restricted Subsidiaries of the Existing Indebtedness;
Credit Agreement or otherwise in an aggregate principal amount not to exceed US$68,250,000 pursuant to this clause (a), (b) Indebtedness, not covered by any other clause of this paragraph, outstanding on the date of this Indenture, (c) Indebtedness arising out of letters of credit, performance bonds, surety bonds and bankers' acceptances incurred in the ordinary course of business; provided that if any unpaid reimbursement obligation under any such instrument is outstanding for more than 10 consecutive business days, such obligation shall not be permitted to be incurred under this clause (c), (d) Indebtedness consisting of guarantees (other than guarantees relating to money borrowed), indemnities or obligations in respect of purchase price adjustments, in each case, in connection with the acquisition of assets permitted under this Indenture, (e) additional Indebtedness of up to $10 million in aggregate principal amount at any one time outstanding, (f) the incurrence by the Company Issuers and the Guarantors of Indebtedness represented by the Notes, the Junior including any Notes and the related Subsidiary Guarantees to be issued as payment of interest or Liquidated Damages on the date Notes in accordance with the terms of the Notes, (g) Indebtedness of a Foreign Subsidiary existing at the time it is acquired (1) that is not incurred in contemplation of the acquisition of such Foreign Subsidiary and (2) that is non-recourse to the Issuers and their respective Subsidiaries except to the assets of such Foreign Subsidiary (for purposes of this Indenture and clause (g), Indebtedness of a Foreign Subsidiary existing at the date of the Junior Note Indenture, respectively, or time it is acquired includes Indebtedness incurred pursuant to Section 4.21 credit facilities in existence upon the acquisition of such Foreign Subsidiary; provided that such Indebtedness meets the requirements of clauses (1) and (2) of this Indenture or Section 4.21 of the Junior Note Indentureclause (g)), respectively;
(ch) the incurrence by the Company or any of its Restricted Issuers and their respective Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness issued in exchange for, or the net proceeds of which are used to refundextend, refinance refinance, renew, replace or replace refund Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture referred to be incurred under the first paragraph of this Section 4.09 or in clauses (a), (b), (cf) and (g) above (the "Refinancing Indebtedness"); provided, however, that (1) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted, or refunded (plus the amount of reasonable expenses incurred in connection therewith); (2) the Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced or refunded; and (3) the Refinancing Indebtedness shall be pari passu with or subordinate in right of payment to the Indebtedness being extended, refinanced, renewed, replaced or refunded, (di) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and either Issuer and/or any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company their respective Subsidiaries or any of its Restricted Subsidiaries of them, (j) Hedging Obligations that are incurred for the purpose of fixing or hedging currency risks, or interest rate risk rates with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in foregoing clauses (a) through (kj) above, are independent exceptions to the covenant set forth in the preceding paragraph and are additive in nature. Limitations set forth in any one of such clauses (a) through (j) or is entitled in the definitions used therein shall not be applicable to any other such clauses or any other such definitions. The Indebtedness permitted to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall foregoing clauses (a) through (j) may be permitted incurred pursuant to classify such item of Indebtedness on the date of its incurrence, one agreement or later reclassify all several agreements with one lender or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09several lenders.
Appears in 2 contracts
Samples: Indenture (Consoltex Usa Inc), Indenture (Consoltex Inc/ Ca)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are publicly available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, 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 or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) hereof shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder), not to exceed $2,078.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company, any of its Restricted Subsidiaries or by any Affiliate Guarantor since the date of this Indenture to repay any term Indebtedness under a Credit Facility or to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to clause (1) of Section 4.10(a) hereof;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors Restricted Subsidiaries of Indebtedness represented by the Notes, the Junior Initial Notes and the related Subsidiary Note Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c4) the incurrence by the Company of the Guarantee of the Convertible Debentures;
(5) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amountamount (or accreted value, as applicable), including all Permitted Refinancing Indebtedness incurred to refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (c5), not to exceed $2.5 100.0 million at any time outstanding;
(d6) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance refinance, replace, defease or replace discharge Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clause (2), (3), (4), (5), (6), (15)(a), (16) or (19) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted SubsidiariesSubsidiaries or between the Company or any of its Restricted Subsidiaries on the one hand and Dynegy on the other hand; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its Note the Guarantee, in the case of a Guarantor; and
(1B) (x) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or Company, a Restricted Subsidiary of the Company or Dynegy and (2y) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or Company, a Restricted Subsidiary of the Company or Dynegy, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance by any of the Company's Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company; shall be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingObligations;
(g10) the Guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee shall be subordinated to the same extent as the Indebtedness guaranteed;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j11) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in respect of workers' compensation claims, self-insurance obligations, bankers' acceptances, performance and surety bonds in the ordinary course of business;
(12) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(13) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary, providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Equity Interests of a Subsidiary; provided that the maximum aggregate liability in respect of all such Indebtedness shall at no time exceed the gross proceeds (including Acquired Debtnon-cash proceeds) actually received by the Company and/or such Restricted Subsidiary in connection with such disposition;
(14) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the deferred purchase price of goods or services, or progress payments in connection with such goods and services, including turbines, transformers and similar equipment, so long as such obligations are incurred in the ordinary course of business;
(15) the incurrence of Indebtedness by the Company or any of its Restricted Subsidiaries in connection with (a) Discontinued Business Operations (other than in respect of tolling agreements, Litigation and the wind-down, settlement or disposition of the customer risk management business) of the Company and its Restricted Subsidiaries in an aggregate principal amount (or accreted value, as applicable) at any time outstanding), including all Permitted Refinancing Indebtedness incurred to refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (j15), not to exceed $5.0 million; and30.0 million at any time outstanding (provided that any Indebtedness created or incurred as a result of set off, cancellation, assignment or similar transaction among or between Restricted Subsidiaries that engage in Discontinued Business Operations, or among or between such Restricted Subsidiaries and other Guarantors in connection with the wind-down of the Discontinued Business Operations, shall not be included when calculating the foregoing dollar limitation) and (b) Litigation;
(k16) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Dynegy Midwest Generation, Inc. or any other Restricted Subsidiary of the Company that was not permitted by in satisfaction of the obligations of Illinois Power pursuant to the Xxxxxx Lease, including the incurrence of any obligation to pay "Rent" or the "Purchase Amount" (each as defined in the Xxxxxx Lease) in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (k16). The Company shall , not incur to exceed at any Indebtedness time outstanding $81.0 million less any amounts invested pursuant to clause (including Permitted Debt17) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right definition of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of "Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.Investments";
Appears in 1 contract
Samples: Indenture (Dynegy Inc /Il/)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's any of its Restricted Subsidiaries may incur issue shares of preferred stock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, the sum of (x) Indebtedness or issue of the Company and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stockstock of Restricted Subsidiaries and (z) the aggregate amount payable by the Company and its Restricted Subsidiaries, if on a consolidated basis, upon redemption of Disqualified Stock to the Fixed Charge Coverage Ratio extent such amount is not included in the preceding clause (y) shall be less than the product of Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Existing IndebtednessCredit Facility;
(bii) the issuance by any Restricted 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 Restricted Subsidiary on a pro rata basis to such holders;
(iii) the incurrence by the Company and the Guarantors of Indebtedness represented by or the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date issuance of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence preferred stock by the Company or any of its Restricted Subsidiaries the proceeds of which are (or the credit support provided by any such Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsis), in each case, incurred for used to finance the purpose construction, capital expenditure and working capital needs of financing all or any part of the purchase price or cost of construction or improvement of propertya Cable Business (including, plant or equipment used in the business of the Company or such Restricted Subsidiarywithout limitation, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred payments made pursuant to this clause (cany License), not to exceed $2.5 million at any time outstandingthe acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and100.0 million at any time;
(kv) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of any Permitted Acquired Debt;
(vi) the incurrence by the Company that was not permitted by this clause or any Subsidiary of Indebtedness issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, or refund the Notes, the 2009 Discount Notes, the 2009 Notes, Existing Indebtedness or Indebtedness referred to in clauses (ki). The Company shall not incur any , (ii), (iii), (iv) or (v) above or Indebtedness incurred pursuant to Section 4.08(a) hereof (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms"REFINANCING INDEBTEDNESS"); provided, however, that no (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 the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of being extended, refinanced, renewed, replaced or refunded, and (B) a stated maturity no earlier than the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09stated maturity of, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrencebeing extended, refinanced, renewed, replaced or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.refunded; and
Appears in 1 contract
Samples: Indenture (NTL Communications Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or and issue Disqualified Stock, Stock and the Company's Subsidiaries any Restricted Subsidiary may incur Indebtedness or issue preferred stockAcquired Debt, if either:
(i) the Fixed Charge Coverage Consolidated Leverage Ratio for at the end of the Company's most recently ended four full fiscal quarters quarter (the "Reference Period") for which internal financial statements are a consolidated balance sheet of the Company is available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 less than 5.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of the Reference Period; or
(ii) the Consolidated Capital Ratio at the end of the Reference Period would have been less than 2.0 to 1.0, determined after giving effect to the incurrence or issuance of such four-quarter periodIndebtedness or Disqualified Stock and, to the extent set forth in the definitions used herein, on a pro forma basis (including, to the extent set forth in the definitions used herein, a pro forma application of the net proceeds therefrom). The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under Credit Facilities or Permitted Vendor Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under all Credit Facilities or Permitted Vendor Facilities after giving effect to such incurrence (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Existing IndebtednessCompany thereunder) does not exceed an amount equal to $725.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the Issue Date to permanently repay Indebtedness under a Credit Facility pursuant to Section 4.10 hereof;
(b) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness;
(c) the Guarantors incurrence by the Company of Indebtedness represented by the Notes, the Junior Euro Notes, the Exchange Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyEuro Exchange Notes;
(cd) the incurrence by the Company or any of its Restricted Subsidiaries of Purchase Money Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for and Vendor Financing Indebtedness provided (A) that the purpose of financing all or any part amount thereof does not exceed 100% of the purchase price or Company's and its Restricted Subsidiaries' aggregate cost (determined in accordance with GAAP in good faith by the Board of construction or Directors) of the construction, acquisition, development, engineering, installation and improvement of property, plant or equipment used the applicable Telecommunications Assets and (B) in the business case of the Company incurrence of either Purchase Money Indebtedness or such Vendor Financing Indebtedness by a Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing such Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingshall be Qualified Subsidiary Indebtedness;
(de) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d), (l), (n), (o) or (jp) of this paragraph;
(ef) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted SubsidiariesSubsidiaries and the issuance of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary of the Company; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness or preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof; shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (ef);
(fg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest or foreign currency exchange rate risk with respect to any floating rate Indebtedness or foreign currency based Indebtedness, respectively, that is permitted by the terms of this Indenture to be outstanding; provided that the notional amount of any such Hedging Obligation does not exceed the amount of Indebtedness or other liability to which such Hedging Obligation relates; and provided further that such Hedging Obligations are not incurred for speculative purposes;
(gh) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a any Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant;
(hi) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09Stock; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (360networks Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any Guarantor may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries Guarantors may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The Company shall not incur any Indebtedness that is contractually subordinated to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated to any other Indebtedness of the Company solely by virtue of being unsecured. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the Existing Indebtednessmaximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the greater of:
(i) $1.4 billion less the aggregate amount of all Net Proceeds of Asset Sales that have been applied by the Company or any of its Restricted Subsidiaries since August 14, 2001 to repay any term Indebtedness under a Credit Facility or to repay revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction, in each case with the Net Proceeds of an Asset Sale pursuant to Section 3.09 hereof, and
(ii) the Borrowing Base;
(b) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness and their existing guarantees;
(c) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of Exchange Notes and the Junior Note Indenture, respectively, or related Subsidiary Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingregistration rights agreement;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (jo) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, Notes in the case of the Company, or its Note Guarantee, the Subsidiary Guarantee in the case of a Guarantor; , and
(1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company; will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or Hedging Obligations with respect to foreign currency translations;
(g) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant or that was in existence on August 14, 2001;
(h) the incurrence by a Receivables Subsidiary of Indebtedness in a Qualified Receivables Transaction that is without recourse to the Company or to any Restricted Subsidiary of the Company or their assets (other than such Receivables Subsidiary and its assets and, as to the Company or any Subsidiary of the Company, other than pursuant to representations, warranties, covenants and indemnities customary for such transactions) and is not guaranteed by any such Person;
(i) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Amerisourcebergen Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, 50 contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company and the Guarantors may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness Stock or issue preferred stock, stock if the Fixed Charge Coverage Debt to Cash Flow Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock stock, as the case may be, is issued would have been at least 2.0 no greater than 5.25 to 1, 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 the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 shall 4.09(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by the Company and any Guarantor of Indebtedness on the date of this Indenture under the Term Loan Agreement less the aggregate amount of all repayments, optional or mandatory, of the principal of the Term Loan Agreement (other than repayments that are concurrently refunded or refinanced);
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Note Guarantees to be issued on the date of this Indenture and the date of Exchange Notes and the Junior related Note Indenture, respectively, or Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d4) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance refinance, replace, defease or replace discharge Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clauses (2), (3) or (4) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e5) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e5);
(f6) the issuance by any of the Company's Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (6);
(7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(g) 8) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant; provided that if the Indebtedness being guaranteed is subordinated to the Notes, then the guarantee shall be subordinated to the same extent as the Indebtedness guaranteed;
(h9) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, health, disability or other employee benefits, property, casualty or liability insurance, or self-insurance or other reimbursement-type obligations, bankers' acceptances, performance and surety bonds and the like in the ordinary course of business;
(10) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within two Business Days;
(11) Indebtedness consisting of customary indemnification, adjustments of purchase price or similar obligations, in each case, incurred or assumed in connection with the acquisition of any business or assets or otherwise in the ordinary course of business; and
(12) the incurrence by the Company or any Guarantor of additional Indebtedness hereunder in an aggregate principal amount that, when aggregated with the principal amount of all other Indebtedness then outstanding and incurred pursuant to this clause (12), does not at any one time outstanding exceed $30.0 million. The Company will not incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured or by virtue of being secured on a first or junior Lien basis. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges Consolidated Interest Expense of the Company as accrued;
(i) . Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness of that the Company or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 4.09 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueof the Indebtedness, as applicable) at in the case of any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(k3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the incurrence by Fair Market Value of such asset at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(b) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The On or prior to the Remarketing Settlement Date, the Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any Subsidiary Guarantor may incur Indebtedness (including Acquired Debt) or any Subsidiary Guarantor may issue Disqualified Stockpreferred stock or SPTL may incur Permitted SPTL Preferred Stock if, on the date of such incurrence and after giving effect thereto, the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Consolidated Leverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least does not exceed 2.0 to 1, determined on a pro forma basis 1.0. The foregoing provisions shall not apply to:
(including a pro forma application i) Indebtedness of the net proceeds therefrom), as if Company existing on the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):Issue Date;
(aii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence Indebtedness represented by the Company and Debentures or by the Subsidiary Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(ciii) the incurrence of Permitted Warehouse Indebtedness by the Company or any of its Restricted Subsidiaries Subsidiaries, and any Guarantee by the Company of such Indebtedness represented incurred by Capital Lease Obligationsa Restricted Subsidiary, mortgage financings or purchase money obligationsprovided, in each casehowever, incurred for that to the purpose of financing all or extent any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business such Indebtedness of the Company or a Subsidiary Guarantor ceases to constitute Permitted Warehouse Indebtedness, such Restricted SubsidiaryIndebtedness shall be deemed to be incurred at such time by the Company or such Subsidiary Guarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingas the case may be;
(div) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under or that was outstanding at the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphIssue Date;
(ev) the incurrence by the Company or a Restricted Subsidiary of Hedging Obligations directly related to (A) Indebtedness of the Company or a Restricted Subsidiary incurred in conformity with the provisions of this Indenture, (B) Receivables held by the Company or its Restricted Subsidiaries pending sale in a Qualified Securitization Transaction, (C) Receivables of the Company or its Restricted Subsidiaries that have been sold pursuant to a Warehouse Facility, (D) Receivables that the Company or the Restricted Subsidiary reasonably expects to purchase or commit to purchase, finance or accept as collateral, or (E) Securitization Related Assets and other assets owned or financed by the Company or its Restricted Subsidiaries in the ordinary course of business; provided, however, that, in the case of each of the foregoing clauses (A) through (E), such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company and its Restricted Subsidiaries on the Issue Date; and
(vi) Indebtedness of the Subsidiary Guarantors or of SPTL to the Company or Permitted SPTL Preferred Stock issued to the Company to the extent that such Indebtedness or such Permitted SPTL Preferred Stock constitutes a Permitted Investment of the Company of the type permitted under the definition of Permitted Investments;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries other than a Special Purpose Subsidiary of intercompany Indebtedness between or among owing to the Company and or any of its Restricted SubsidiariesSubsidiaries other than a Special Purpose Subsidiary; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that any Capital Stock which results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company (other than a Special Purpose Subsidiary) shall be deemed, in each case, to constitute an the incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Special Purpose Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness Non-Recourse Debt in the form of additional Indebtedness with the same terms, a Qualified Securitization Transaction and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, ; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an the Special Purpose Subsidiary or other Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company; and
(ix) the incurrence by the Company that was not permitted by this clause (k). The Company shall not incur any and its Restricted Subsidiaries of Indebtedness (including Permitted Debt) that is contractually subordinated in right an aggregate principal amount which, together with the principal amount of payment to any other all Indebtedness of the Company unless such and its Restricted Subsidiaries outstanding on the date of Incurrence (other than Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely permitted by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (aii) through (kvii) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09covenant), the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09does not exceed $10,000,000.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") Incur any Indebtedness (including Acquired Debt), ) and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; providedPreferred Stock, however, provided that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified StockIncur Indebtedness, and any other Credit Party (other than GCUK, Global Marine or any of their respective Subsidiaries) may Incur Indebtedness, at any time after the date upon which at least one complete fiscal quarter has elapsed subsequent to the Issue Date for which financial statements of the Company are available if:
(i) the Company's Subsidiaries may incur Consolidated Leverage Ratio is less than 3.00 to 1; and
(ii) any such Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for is (A) expressly subordinated in right of payment to the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding or such other Credit Party's, as applicable, obligations Indenture under this Indenture, (B) does not require or permit payment of principal thereon prior to the date that is 91 days after the Stated Maturity of the principal amount of the Notes, (C) may not at the option of the holder thereof be required to be repurchased, redeemed, retired, repaid, prepaid or called prior to the date 91 days after the date on which such additional Indebtedness the Notes mature and (D) is incurred not convertible or such Disqualified Stock exchangeable into any security or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis instrument that does not comply with the restrictions in the foregoing sub-clauses (including a pro forma application of the net proceeds therefromA), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of (B) and (C); provided that this Section 4.09 clause (ii) shall not prohibit the incurrence Company or any other Credit Party from Incurring Indebtedness with change of control repurchase, redemption or prepayment provisions similar to those contained in Section 4.15 hereof with respect to any Indebtedness otherwise permitted hereunder (it being understood that no subordinated Indebtedness may be repurchased, redeemed or prepaid prior to the Change of Control Payment Date referred to in paragraph (a) of Section 4.15 hereof, except as otherwise permitted by this Indenture). Notwithstanding the foregoing, the provisions of the preceding paragraph will not apply to the Incurrence (without duplication) of any of the following items of Indebtedness (collectively, "Permitted Debt"):Indebtedness:
(a) the incurrence Incurrence by the Issuer or any Guarantor (other than GCUK, Global Marine or any of their Subsidiaries) of Indebtedness under Working Capital Facilities in an aggregate principal amount at any one time outstanding under this clause (a) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed at any time (i) the Working Capital Facility Limit then in effect minus (ii) the aggregate amount of the Existing IndebtednessIndebtedness then outstanding in connection with Qualified Receivables Transactions;
(b) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with Qualified Receivables Transactions (including any such Incurrence through the sale by the Company or any of its Restricted Subsidiaries of Receivables) not to exceed at any time (i) the Working Capital Facility Limit then in effect minus (ii) the aggregate amount of Indebtedness outstanding under all Working Capital Facilities;
(c) the Incurrence by the Issuer and the Guarantors of Indebtedness represented represented, respectively, by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees in connection therewith;
(cd) Existing Indebtedness;
(e) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness represented between or among the Company and any of its Restricted Subsidiaries, or the issuance of Preferred Stock by Capital Lease Obligationsany Indenture Restricted Subsidiary of the Company to the Company or any Restricted Subsidiary of the Company, mortgage financings provided that:
(i) if the Issuer or purchase money obligationsany Guarantor is obligated in respect of such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to (A) the Notes, in the case of the Issuer, or (B) the Note Guarantees, in the case of a Guarantor, in each case pursuant to an Affiliate Subordination Agreement in substantially the form of Exhibit E-1 hereto, and shall not be secured by any Lien on any Property of the Company or any of its Subsidiaries; and
(ii) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or Preferred Stock being held by a Person other than a Credit Party, and any sale or other transfer of any such Indebtedness or Preferred Stock to a Person that is not a Credit Party, will be deemed, in each case, incurred for the purpose to constitute an Incurrence of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the Incurrence by the Company or any of its Restricted Subsidiaries of Purchase Money Indebtedness, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred Incurred to refund, refinance or replace any Indebtedness incurred Incurred pursuant to this clause (cf), not to exceed exceeding $2.5 million 50,000,000 at any time outstanding;
(dg) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are Incurred for the purpose of fixing or hedging interest or foreign currency exchange rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding, or for the purpose of limiting currency exchange rate risks directly related to transactions entered into by the Company or such Restricted Subsidiary in the ordinary course of business and not for speculative purposes;
(h) the Incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness not otherwise permitted to be Incurred pursuant to this Section 4.09 in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any such Indebtedness Incurred pursuant to this clause (h), not exceeding $10,000,000;
(i) the Incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Incurred pursuant to the first paragraph of this Section 4.09 or clauses clause (ad), (b), (c), (df) or (jh) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Global Crossing LTD)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Stericycle shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Stericycle shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Stericycle may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the CompanyStericycle's Restricted Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the CompanyStericycle's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0 in the case of any such incurrence or issuance occurring on or prior to the third anniversary of the date of this Indenture and 2.25 to 1.0 in the case of any such incurrence or issuance that occurs thereafter, in each case 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 covenant shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by Stericycle and any Guarantor of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of Stericycle and any Guarantors thereunder) not to exceed $275.0 million less the aggregate amount of all Net Proceeds of Asset Sales that have been applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to repay any term Indebtedness under a Credit Facility pursuant to Section 4.10 hereof and less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries to repay any revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction thereunder pursuant to Section 4.10 hereof and less the aggregate amount of Indebtedness of Receivables Subsidiaries outstanding pursuant to clause (13) below;
(2) the incurrence by Stericycle and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company Stericycle and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of Exchange Notes and the Junior Note Indenture, respectively, or related Subsidiary Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c4) the incurrence by the Company Stericycle or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company Stericycle or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed $2.5 10.0 million at any time outstanding;
(d5) the incurrence by the Company Stericycle or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a2), (b3), (c4), (d) 5), or (j14) of this paragraph;
(e6) the incurrence by the Company Stericycle or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Stericycle and any of its Restricted Subsidiaries; provided, however, that:
(ia) if the Company Stericycle or any Guarantor is the obligor on such IndebtednessIndebtedness and the holders of Senior Debt under the Credit Facilities do not have a security interest therein, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the CompanyStericycle, or its Note the Subsidiary Guarantee, in the case of a Guarantor; and
(1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Stericycle or a Restricted Subsidiary of the Company Stericycle and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Stericycle or a Restricted Subsidiary of the Company shall Stericycle; will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Stericycle or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e6);
(f7) the incurrence by the Company or any Indebtedness consisting of its Restricted Subsidiaries of Permitted Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingAgreements;
(g) 8) the Guarantee guarantee by the Company Stericycle or any of the Guarantors of Indebtedness of the Company Stericycle or a Restricted Subsidiary of the Company Stericycle that was permitted to be incurred by another provision of this Section 4.09;
(h9) the incurrence by Stericycle's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, that event will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of Stericycle that was not permitted by this clause (9);
(10) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09covenant; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company Stericycle as accrued;
(i11) Indebtedness obligations in respect of the Company performance and surety bonds and completion guarantees provided by Stericycle or any Restricted Subsidiary to of Stericycle in the extent that the Net Proceeds thereof are promptly:ordinary course of business;
(i12) used Indebtedness incurred by Stericycle or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to purchase Notes tendered letters of credit issued in an offer the ordinary course of business in respect of workers' compensation claims or self-insurance, or other Indebtedness with respect to purchase made as a result of a Change in Control, orreimbursement type obligations regarding workers' compensation claims;
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j13) the incurrence by a Receivables Subsidiary of Indebtedness in a Qualified Receivables Transaction that is without recourse to Stericycle or to any other Restricted Subsidiary of Stericycle or their assets (other than such Receivables Subsidiary and its assets and, as to Stericycle or any Subsidiary of Stericycle, other than pursuant to representations, warranties, covenants and indemnities customary for such transactions); and
(14) the Company incurrence by Stericycle or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) and/or the issuance of Permitted Domestic Subsidiary Preferred Stock by Stericycle's Domestic Subsidiaries in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j14), not to exceed $5.0 20.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k14) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company Stericycle shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, incurrence in any manner that complies with this Section 4.09. Indebtedness incurred under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt. The Series A Convertible Preferred Stock issued pursuant to the Preferred Stock Agreement dated the date hereof shall be deemed to have been issued prior to the execution of this Indenture.
Appears in 1 contract
Samples: Indenture (Stericycle Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, Disqualified Stock or preferred stock, as applicable (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries (and the Guarantee thereof by any Restricted Subsidiary or the Company, as applicable) of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit (other than letters of credit contemplated by Section 4.09(b)(12)) being deemed to have a principal amount equal to the maximum potential liability of the Company and the Restricted Subsidiaries thereunder), when taken together with the aggregate principal amount of all then-outstanding Indebtedness incurred pursuant to Section 4.09(b)(14), not to exceed the greater of:
(A) the Designated Amount; or
(B) the Borrowing Base as of the date of such incurrence;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors Guarantor of Indebtedness represented by (A) the Notes, the Junior Notes and the related Subsidiary Guarantees Guarantee and the 2013 Notes and the related 2013 Subsidiary Guarantee to be issued on the date of this Indenture Indenture, and (B) the Exchange Notes and the date of related Subsidiary Guarantee and the Junior Note Indenture, respectively, or 2013 Exchange Notes and the related 2013 Subsidiary Guarantee to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of propertyproperty (real or personal), plant or equipment (whether through the direct purchase of assets or through the purchase of the Capital Stock of any Person owning such assets) used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed the greater of (i) $2.5 300.0 million at any time outstandingor (ii) 3.0% of the Consolidated Net Tangible Assets of the Company and its Restricted Subsidiaries;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clause (2), (3), (4), (5), (12), (13), (17) or (18) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of obligations with respect to letters of credit securing obligations entered into in the ordinary course of business to the extent such letters of credit are not drawn upon or, if drawn upon, such drawing is reimbursed within five Business Days following receipt of a demand for reimbursement;
(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any the Guarantor is the obligor on such IndebtednessIndebtedness and such Indebtedness is held by a Restricted Subsidiary other than the Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a the Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance of shares of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which, in either case, results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of preferred stock (except to the Company or another Restricted Subsidiary) shall be deemed in each case to be an issuance of such shares of preferred stock that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of of:
(A) Hedging Obligations that are incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gB) Indebtedness in respect of performance, surety or appeal bonds provided in the ordinary course of business; and
(C) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price or similar obligations of the Company or any of its Restricted Subsidiaries incurred in connection with the disposition of any business, assets or Subsidiary of the Company in an aggregate amount not to exceed the gross proceeds actually received by the Company or any Restricted Subsidiary in connection with such disposition;
(10) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j11) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers' compensation claims, environmental remediation or other environmental matters or payment obligations in connection with self-insurance or similar requirements, in each case to the extent arising in the ordinary course of business; (including Acquired Debt12) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit pursuant to or made in connection with that certain Insurance Allocation and Services Agreement, dated November 27, 2002, between the Company and Unisource Worldwide, Inc., in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), outstanding not to exceed $5.0 25.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.;
Appears in 1 contract
Samples: Indenture (Fort James Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company Issuer shall not, and shall not cause or permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall Issuer will not and will not permit any Restricted Subsidiary to issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Issuer may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Issuer and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's Issuer’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock is issued issued, as the case may be, would have been at least 2.0 2.00 to 11.00, 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 the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this .
(b) Section 4.09 4.06(a) shall not not, however, prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(ai) the incurrence of Indebtedness under Credit Facilities by the Issuer or any Restricted Subsidiary up to an aggregate principal amount equal to $95.0 million at any time outstanding; provided, however, that the maximum amount permitted to be outstanding under this clause (i) shall not be deemed to limit additional Indebtedness under the Credit Facilities to the extent the incurrence of such additional Indebtedness is permitted pursuant to any of the other provisions under this covenant;
(ii) the incurrence by the Company Issuer and its Restricted Subsidiaries of Existing Indebtedness (including the Existing IndebtednessSecured Notes);
(biii) the incurrence by the Company Issuer and any Restricted Subsidiary of Indebtedness represented by letters of credit in an aggregate principal amount at any time outstanding not to exceed the greater of $10.0 million or 1.0% of Total Tangible Assets (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Issuer and its Restricted Subsidiaries thereunder);
(iv) the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Notes, Notes issued on the Junior Notes Issue Date and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cv) the incurrence by the Company Issuer or any of its Restricted Subsidiaries Subsidiary of Indebtedness represented by Attributable Debt, Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price price, lease expense, rental payments or cost of construction design, construction, installation or improvement of propertyproperty (including Vessels), plant or equipment or other assets (including Capital Stock) used in the business of the Company Issuer or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness Indebtedness, incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (cv), not to exceed the greater of (A) $2.5 20.0 million and (B) 2.5% of Total Tangible Assets at any time outstandingoutstanding (it being understood that any such Indebtedness may be incurred after the acquisition, purchase, charter or leasing or the construction, installation or the making of any improvement with respect to any asset (including Vessels)); provided, that any Permitted Refinancing Indebtedness incurred pursuant to clause (vii) of this Section 4.06(b) in respect of Indebtedness previously incurred pursuant to this clause (v), and not reclassified to be incurred under the first paragraph above or another category of Permitted Debt, shall be deemed to reduce the amount of Indebtedness that may be incurred under this clause (v) by an equal amount (but shall not reduce such amount to less than zero);
(dvi) the incurrence by the Company Issuer or any Restricted Subsidiary of its Restricted Subsidiaries Indebtedness in connection with New Vessel Financings in an aggregate principal amount at any one time outstanding, not exceeding the New Vessel Aggregate Secured Debt Cap as calculated on the date of the relevant incurrence under this clause (vi);
(vii) Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.06(a) or clauses (ii), (iv), (v), (vi), (vii), (viii), (xiv) or (xviii) of this Section 4.09 or clauses (a4.06(b), (b), (c), (d) or (j) of this paragraph;
(eviii) Indebtedness or Disqualified Stock of the Issuer and Indebtedness or Disqualified Stock or preferred stock of any Restricted Subsidiary in an aggregate principal amount or liquidation preference up to 100% of the net cash proceeds received by the Issuer since the Issue Date from the issue or sale of Equity Interests of the Issuer or cash contributed to the capital of the Issuer (in each case, other than proceeds of Disqualified Stock or preferred stock or sales of Equity Interests to the Issuer or any of its Subsidiaries) as determined in accordance with Section 4.08(a)(iii)(B) to the extent such net cash proceeds or cash have not been applied pursuant to such clauses to make Restricted Payments pursuant to Section 4.08(b) or to make Permitted Investments (other than Permitted Investments specified in clause (c) of the definition thereof);
(ix) the incurrence by the Company Issuer or any of its Restricted Subsidiaries Subsidiary of intercompany Indebtedness between or among the Company and Issuer or any of its Restricted SubsidiariesSubsidiary; provided, however, provided that:
(iA) if the Company Issuer or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Issuer or a Guarantor, such Indebtedness must be unsecured and (except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with the cash management operations of the Issuer and its Restricted Subsidiaries) expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the CompanyIssuer, or its the Note Guarantee, in the case of a Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuer or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Issuer or a Restricted Subsidiary of the Company shall Subsidiary, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Issuer or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (eix);
(fx) the incurrence issuance by any Restricted Subsidiary to the Company Issuer or to any of its Restricted Subsidiaries of Hedging Obligations preferred stock; provided that are incurred for (A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the purpose Issuer or a Restricted Subsidiary and (B) any sale or other transfer of fixing or hedging interest rate risk with respect any such preferred stock to any floating rate Indebtedness a Person that is not either the Issuer or a Restricted Subsidiary, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by the terms of this Indenture to be outstandingclause (x);
(gxi) the incurrence by the Issuer or any Restricted Subsidiary of Hedging Obligations not for speculative purposes;
(xii) the Guarantee by the Company Issuer or any of the Guarantors Guarantor of Indebtedness of the Company Issuer or a Restricted Subsidiary of any Guarantor to the Company extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.094.06; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes or a Note Guarantee, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jxiii) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired DebtA) in an aggregate principal amount respect of workers’ compensation claims, self-insurance obligations, captive insurance companies, bankers’ acceptances, performance and surety bonds in the ordinary course of business; (B) in respect of letters of credit, surety, performance or accreted valueappeal bonds, completion guarantees, judgment, advance payment, customs, VAT or other tax guarantees or similar instruments issued in the ordinary course of business of such Person or consistent with industry practice (including as applicablerequired by any governmental authority) at any time outstandingand not in connection with the borrowing of money, including all Permitted Refinancing Indebtedness incurred to refund, refinance letters of credit or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries similar instruments in respect of Nonself-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical termsinsurance and workers compensation obligations; provided, however, that no upon the drawing of such letters of credit or other instrument, such obligations are reimbursed within 30 days following such drawing; (C) arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within 30 days; (D) consisting of (x) the Company shall be deemed to be contractually subordinated financing of insurance premiums or (y) take-or-pay obligations contained in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09supply agreements, in each case, in the event that ordinary course of business; (E) arising in connection with endorsements of instruments for deposit in the ordinary course of business; and (F) unsecured Indebtedness arising out of judgments not constituting an item Event of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.Default;
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee Guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph provisions of this Section 4.09 shall 9.01 hereof will not prohibit the incurrence of of, or prohibit the Company and its Subsidiaries from remaining liable with respect to, any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(a) Existing Debt, excluding the incurrence by Notes and the Company and its Restricted Subsidiaries of the Existing IndebtednessSenior Secured Notes;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyAgreement;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose Senior Secured Notes issued on the date of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred this Agreement pursuant to this clause (c), not to exceed $2.5 million at any time outstandingthe Senior Note Purchase Agreement;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness Debt in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtednessthat is described in Sections 9.01(c) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), and (d) or (j) of this paragraph);
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among owed to the Company and or any of its Restricted Wholly Owned Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations obligations with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; ;
(ii) in each case where the Company or any Guarantor is the creditor, such Indebtedness is in compliance with Section 6.1(b)(v)(B) of the Senior Note Purchase Agreement;
(iii) the following will be deemed, in each case, to constitute an incurrence of Indebtedness by the Company or one of its Subsidiaries, as the case may be, that was not permitted by this Section 9.01(e):
(A) any subsequent issuance or transfer of Equity Interests that result in any Indebtedness originally incurred pursuant to this Section 9.01(e) being held by a Person other than the Company or a Subsidiary thereof, and
(1B) any sale or other transfer of any Indebtedness originally incurred pursuant to this Section 9.01(e) to a Person that is not either the Company or a Wholly Owned Subsidiary thereof,
(f) the issuance by any of the Company’s Subsidiaries to the Company or to any of its Wholly Owned Subsidiaries of shares of preferred stock; provided, that the following will be deemed, in each case, to constitute an issuance of preferred stock by such Subsidiary that was not permitted by this Section 9.01(f):
(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness preferred stock originally issued pursuant to this Section 9.01(f) being held by a Person other than the Company or a Restricted Wholly Owned Subsidiary of the Company and Company; and
(2ii) any sale or other transfer of any such Indebtedness preferred stock originally issued pursuant to this Section 9.01(f) to a Person that is not either the Company or a Restricted Wholly-Owned Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e)Company;
(fg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(gh) the Guarantee by the Company or any of the Guarantors its Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.099.01; provided, that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee shall be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(hi) the incurrence by the Company or any of its Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance and surety bonds in the ordinary course of business;
(j) the incurrence by the Company of Indebtedness represented by the Series A Preferred Stock and Series B Preferred Stock outstanding or issued on the Closing Date; and
(k) the incurrence by the Company or any of its Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days. The accrual of interest, the accretion or amortization of original issue discountdiscount on any Indebtedness, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof9.01.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Securities Purchase Agreement (Ign Entertainment Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's any of its Restricted Subsidiaries may incur issue shares of preferred stock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, the sum of (x) Indebtedness or issue of the Company and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stockstock of Restricted Subsidiaries and (z) the aggregate amount payable by the Company and its Restricted Subsidiaries, if on a consolidated basis, upon redemption of Disqualified Stock to the Fixed Charge Coverage Ratio extent such amount is not included in the preceding clause (y) shall be less than the product of Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Existing IndebtednessCredit Facility;
(bii) the issuance by any Restricted 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 Restricted Subsidiary on a pro rata basis to such holders;
(iii) the incurrence by the Company and the Guarantors of Indebtedness represented by or the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date issuance of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence preferred stock by the Company or any of its Restricted Subsidiaries the proceeds of which are (or the credit support provided by any such Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsis), in each case, incurred for used to finance the purpose construction, capital expenditure and working capital needs of financing all or any part of the purchase price or cost of construction or improvement of propertya Cable Business (including, plant or equipment used in the business of the Company or such Restricted Subsidiarywithout limitation, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred payments made pursuant to this clause (cany License), not to exceed $2.5 million at any time outstandingthe acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and100.0 million at any time;
(kv) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of any Permitted Acquired Debt;
(vi) the incurrence by the Company that was not permitted by this clause or any Subsidiary of Indebtedness issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, or refund the Notes, the 2006 Notes, the 2009 Notes, Existing Indebtedness or Indebtedness referred to in clauses (ki). The Company shall not incur any , (ii), (iii), (iv) or (v) above or Indebtedness incurred pursuant to Section 4.08(a) hereof (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms"REFINANCING INDEBTEDNESS"); provided, however, that no Indebtedness of (1) the Company shall be deemed to be contractually subordinated principal amount of, and any premium payable in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09respect of, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.Refinancing
Appears in 1 contract
Samples: Indenture (NTL Communications Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and that the Company shall will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or and the Company may issue shares of Disqualified Stock, and Stock if the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Debt to Cash Flow Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 no greater than 5.5 to 1, in the case of any such incurrence or issuance on or before December 31, 2000, or no greater than 5.0 to 1, in the case of any such incurrence or issuance at any time thereafter, in each case, determined on a pro forma basis (including a pro forma application of the net proceeds therefromthereof), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-the applicable four full fiscal quarter period. The first paragraph of this Section 4.09 Company shall not prohibit incur any Indebtedness that is contractually subordinated to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated to the Senior Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated to any other Indebtedness of the Company solely by virtue of being unsecured.
(b) The provisions Section 4.09(a) shall not apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company or its Restricted Subsidiaries of Indebtedness under Credit Facilities; provided that the aggregate principal amount of all Indebtedness (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company thereunder) outstanding under all Credit Facilities after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i), does not exceed an amount equal to $40.0 million less the aggregate amount of all Net Proceeds of Asset Sales that have been applied since the date of this Indenture to repay Indebtedness under Credit Facilities (or any such Permitted Refinancing Indebtedness) pursuant to Section 4.10 hereof, provided, further, that the aggregate principal amount of Indebtedness at any one time outstanding under Credit Facilities that is incurred by, or secured by the Capital Stock or assets of, any Restricted Subsidiary that is located, or that derives substantially all of its revenue from the conduct of business, in Peru shall not exceed $15.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by Capital Lease Obligationsthe prior owner of such assets or such Subsidiary prior to such acquisition by the Company or such Restricted Subsidiary and was not incurred in connection with, mortgage financings or purchase money obligationsin contemplation of, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of such acquisition by the Company or such Restricted Subsidiary; and provided further that the principal amount (or accreted value, in an aggregate principal amountas applicable) of such Indebtedness (or accreted value, as applicable), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (civ), does not to exceed $2.5 5.0 million at any time outstanding;
(dv) Indebtedness of the Company not to exceed, at any one time outstanding, two times the sum of (A) the Current Market Value as of the date of issue of any Qualified Capital Stock of the Company issued to the seller(s) of a Permitted Business as consideration for the acquisition of such business and (B) the net cash proceeds received by the Company after the date of this Indenture from the issuance and sale of its Qualified Capital Stock to the extent that such net cash proceeds have been, and continue to be, designated as Designated Equity Proceeds to be used for the purpose of incurring additional Indebtedness pursuant to this clause (v) as provided in the definition thereof; provided that, to the extent that any such Qualified Capital Stock ceases to be outstanding for any reason, any Indebtedness that was incurred as a result of the receipt of net cash proceeds from the issuance of such Qualified Capital Stock shall cease (as of the date on which such Qualified Capital Stock ceases to be outstanding) to be permitted by virtue of this clause (v);
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany IndebtednessIndebtedness or Indebtedness pursuant to a Credit Facility) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
that (iA) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; andSenior Notes and (B)
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(fviii) the incurrence guarantee by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(kix) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, ; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause Company;
(k). The Company shall not incur any Indebtedness (including Permitted Debtx) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless or any Restricted Subsidiary of the Company (A) in respect of statutory obligations, performance, surety or appeal bonds or other obligations of a like nature incurred in the ordinary course of business or (B) under Hedging Obligations; provided that such Indebtedness is also contractually subordinated agreements (1) are designed solely to protect the Company or its Restricted Subsidiaries against fluctuations in right of payment to foreign currency exchange rates or interest rates and (2) do not increase the Notes on substantially identical terms; provided, however, that no Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in foreign currency exchange rates or interest rates or by reason of fees, indemnities and compensation payable thereunder; and
(xi) the incurrence by the Company shall be deemed of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to be contractually subordinated in right of payment to refund, refinance or replace any other Indebtedness of the Company solely by virtue of being unsecured. incurred pursuant to this clause (xi), not to exceed $5.0 million.
(c) For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxi) above, of Section 4.09(b) hereof or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09(a) hereof, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness will be treated as having been incurred pursuant to only one of such clauses of Section 4.09(b) hereof or pursuant to Section 4.09(a) hereof. Accrual of interest and the accretion of accreted value will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall (a) Borrower will not, and shall not nor will it cause or permit any of its Subsidiaries Restricted Subsidiary to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) or suffer to exist any Indebtedness (including Acquired Debt)) other than Permitted Debt, and the Company shall Borrower will not issue any Disqualified Capital Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided. Notwithstanding the foregoing, however, that the Company Borrower may incur Indebtedness (including Acquired Debt) or issue Disqualified Capital Stock, and the Company's Borrower’s Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's Borrower’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Capital Stock or such preferred stock is issued issued, as the case may be, would have been at least 2.0 to 1, 1 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 Capital Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this This Section 4.09 shall 6.01(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;.
(b) the incurrence by the Company Borrower will not incur, and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or will not permit any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligationsto incur, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company Borrower or such Restricted Subsidiary unless such Indebtedness is also contractually subordinated in right of payment to the Notes Obligations and the Guarantee of such Restricted Subsidiary on substantially identical terms; provided, however, that no Indebtedness of the Company shall will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company Borrower solely by virtue of being unsecured. unsecured or by virtue of being secured on a junior priority basis.
(c) For purposes of determining compliance with this Section 4.096.01, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) aboveDebt, or is entitled to be incurred pursuant to the first paragraph of this Section 4.096.01, the Company shall Borrower will be permitted permitted, in its sole discretion, to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.096.01. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Capital Stock in the form of additional shares of the same class of Disqualified Capital Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Capital Stock for purposes of this Section 6.01; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Borrower as accrued. Notwithstanding any other provision of this Section 6.01, the maximum amount of Indebtedness that the Borrower or any Restricted Subsidiary may incur pursuant to this Section 6.01 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
(d) The amount of any Indebtedness outstanding as of any date will be:
(i) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(ii) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(iii) in respect of Indebtedness of another person secured by a Lien on the assets of the specified person, the lesser of:
(a) the Fair Market Value of such assets at the date of determination; and
(b) the amount of the Indebtedness of the other person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their respective Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company Issuers shall not issue any Disqualified Stock and shall not permit any of its their respective Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Issuers or any of the Subsidiary Guarantors may incur Indebtedness (including Acquired Debt) or ), the Issuers may issue Disqualified Stock, Stock and any of the Company's Subsidiaries Subsidiary Guarantors may incur Indebtedness or issue preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's Issuers' most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of or the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer of Indebtedness and reimbursement obligations in respect of letters of credit pursuant to the Senior Credit Facilities; provided that the aggregate amount of all Indebtedness then classified as having been incurred in reliance upon this clause (1) that remains outstanding under the Senior Credit Facilities after giving effect to such incurrence does not exceed an amount equal to $450.0 million less, to the extent a permanent repayment and/or commitment reduction is required thereunder as a result of such application, the aggregate amount of Net Proceeds applied to repayments under the Senior Credit Facilities in accordance with Section 4.10;
(2) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer of Existing Indebtedness;
(3) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company Issuers and the Subsidiary Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be originally issued on the date of this Indenture and the date of Subsidiary Guarantees, and the Junior Note Indenture, respectively, or Exchange Securities to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement in respect thereof;
(c4) the incurrence by the Company an Issuer or any Restricted Subsidiary of its Restricted Subsidiaries an Issuer of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used or useful in the business of the Company an Issuer or such Restricted Subsidiary, Subsidiary (whether through the direct purchase of assets or the Capital Stock of any Person owning such Assets) in an aggregate principal amountamount or accreted value, including all Permitted Refinancing as applicable, not to exceed at any time outstanding the greater of $25.0 million and 2.5% of Total Assets at the time of any incurrence under this clause (4);
(5) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer of Indebtedness in connection with the acquisition of assets or a new Restricted Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Restricted Subsidiary prior to refundsuch acquisition by an Issuer or one of its Subsidiaries and was not incurred in connection with, refinance or replace in contemplation of, such acquisition by an Issuer or a Subsidiary of an Issuer; provided further, that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (c5), and Permitted Refinancing Indebtedness in respect thereof, does not to exceed $2.5 million at any time outstanding25.0 million;
(d6) the incurrence by the Company an Issuer or any Restricted Subsidiary of its Restricted Subsidiaries an Issuer of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture incurred pursuant to be incurred under the first paragraph of this Section 4.09 or clauses 4.09, clause (a), (b), (c), (d2) or (j3) of above or this paragraphclause (6);
(e7) the incurrence by the Company an Issuer or any Restricted Subsidiary of its Restricted Subsidiaries an Issuer of intercompany Indebtedness between or among the Company an Issuer and another Issuer or between an Issuer and any Restricted Subsidiary of its Restricted Subsidiariesan Issuer; provided, however, that:
(ia) if the Company an Issuer or any Subsidiary Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Issuer or a Subsidiary Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Companyan Issuer, or its Note Guaranteethe Guarantee of such Subsidiary Guarantor, in the case of a Subsidiary Guarantor; and
(1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company an Issuer or a Restricted Subsidiary of the Company and an Issuer or (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company an Issuer or a Restricted Subsidiary of the Company an Issuer shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company such Issuer or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f) 8) the incurrence by the Company an Issuer or any Restricted Subsidiary of its Restricted Subsidiaries an Issuer of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g9) the Guarantee by the Company an Issuer or any of the Guarantors a Subsidiary Guarantor of Indebtedness of the Company an Issuer or a Restricted Subsidiary of the Company Guarantor that was permitted to be incurred by another provision of this Section 4.09;
(h10) the issuance by a Restricted Subsidiary of an Issuer to an Issuer or any Restricted Subsidiary that is a Wholly-Owned Subsidiary of an Issuer of preferred stock; provided that (a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than an Issuer or a Subsidiary Guarantor and (b) any sale or other transfer of any such preferred stock to a Person that is neither an Issuer nor a Restricted Subsidiary of an Issuer shall be deemed, in each case, to constitute an issuance of such preferred stock by such Subsidiary Guarantor that is not permitted by this clause (10);
(11) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer in respect of workers' compensation claims, self-insurance obligations, indemnities, bankers' acceptances, performance, completion and surety bonds or guarantees, and similar types of obligations in the ordinary course of business;
(12) Indebtedness arising from agreements of an Issuer or any Restricted Subsidiary of an Issuer providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, asset or Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition; provided that (a) such Indebtedness is not reflected on the balance sheet of an Issuer or any Restricted Subsidiary of an Issuer (contingent obligations referred to in a footnote or footnotes to financial statements and not otherwise reflected on the balance sheet shall not be deemed to be reflected on such balance sheet for purposes of this clause (a)) and (b) the maximum assumable liability in respect of such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any such subsequent changes in value) actually received by such Issuer and/or such Restricted Subsidiary in connection with such disposition;
(13) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(14) Indebtedness of the type described in clause (6)(a) of the definition thereof together with contingent liabilities arising out of transactions contemplated thereby not to exceed $20.0 million at any one time outstanding; and
(15) the incurrence by an Issuer or any Restricted Subsidiary of an Issuer of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (15), not to exceed $25.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (15) above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Issuers shall be permitted to classify such item of Indebtedness in any manner that complies with this Section 4.09 (except that Indebtedness incurred under the Senior Credit Facilities on the date of this Indenture shall be deemed to have been incurred pursuant to clause (1) above). In addition, the Issuers may, at any time, change the classification of an item of Indebtedness (or any portion thereof) to any other clause or to the first paragraph of this Section 4.09 hereof; provided that the Issuers would be permitted to incur such item of Indebtedness (or portion thereof) pursuant to such other clause or the first paragraph of this Section 4.09 hereof, as the case may be, at such time of reclassification. The accrual of interest, the accrual of interestdividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and that the Company shall will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired DebtIndebtedness) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries that are Guarantors may incur Indebtedness or and issue preferred stock, if stock if: (i) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and (ii) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; provided, that no Guarantee may be incurred pursuant to this paragraph, unless the guaranteed Indebtedness is incurred by the Company or a Guarantor pursuant to this paragraph. The first paragraph of this Section 4.09 shall foregoing provisions will not prohibit apply to:
(i) the incurrence of Indebtedness by the Company or the Guarantors under the Credit Agreement (and Guarantees thereof by Subsidiaries that are Guarantors) in an aggregate principal amount at any time outstanding (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the following items Company and its Subsidiaries thereunder) not to exceed an amount (including any Indebtedness incurred to refinance, retire, renew, defease, refund or otherwise replace any such Indebtedness) equal to the greater of (a) $85,000,000, less the aggregate amount of all Net Proceeds of Asset Sales applied to permanently reduce the outstanding amount or, as applicable the commitments with respect to such Indebtedness pursuant to Section 4.08 hereof and (collectively, "Permitted Debt"):b) an amount equal to the sum of 80% of the book value of the consolidated accounts receivable of the Company and its Subsidiaries that are Guarantors and 50% of the book value of the consolidated inventory of the Company and its Subsidiaries that are Guarantors;
(aii) the Existing Indebtedness;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes (up to an aggregate principal amount of $100,000,000) and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence Guarantees of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e)Notes;
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and that the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; providedPROVIDED, howeverHOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and any of the Company's Restricted Subsidiaries may incur Indebtedness or issue preferred stock, if the Company's Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtPERMITTED DEBT"):
(ai) the incurrence by the Company or its Restricted Subsidiaries of term Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under the Credit Facility; PROVIDED that the aggregate principal amount of all term Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i) does not exceed an amount equal to $550.0 million;
(ii) the incurrence by the Company or its Restricted Subsidiaries of revolving credit Indebtedness under the Credit Facility, letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) and related Guarantees under the Credit Facility; PROVIDED that the aggregate principal amount of all revolving Indebtedness and letters of credit of the Company and its Restricted Subsidiaries (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) outstanding under the Credit Facility after giving effect to such incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (ii), does not exceed $700.0 million less the aggregate amount of Asset Sale proceeds applied by the Company and its Restricted Subsidiaries to permanently reduce the availability of revolving credit Indebtedness under the Credit Agreements pursuant to the provisions of Section 4.10 hereof;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors of Indebtedness represented by the Senior Notes, the Junior Notes Senior Subordinated Notes, the Senior Subsidiary Guarantees and the related Subordinated Subsidiary Guarantees limited in aggregate principal amount, without duplication, to be issued on amounts outstanding under the date of this Senior Note Indenture and the date this Senior Subordinated Note Indenture as of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelytheir respective dates;
(cv) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (cv), not to exceed $2.5 million at any time outstanding5% of Total Assets;
(dvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; providedPROVIDED, howeverHOWEVER, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the NotesSenior Subordinated Note and this Senior Subordinated Note Indenture, in the case (ii) if a Restricted Subsidiary of the CompanyCompany is the obligor on such Indebtedness, or its Note Guarantee, such Indebtedness is expressly subordinated to the prior payment in the case full in cash of a Guarantor; and
such Restricted Subsidiary's Senior Subsidiary Guarantee and (1iii)(A) any subsequent event or issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the normal course of business for the purpose of fixing or hedging currency, commodity or interest rate risk (including with respect to any floating rate Indebtedness that is permitted by the terms of this Senior Subordinated Note Indenture to be outstandingoutstanding in connection with the conduct of their respective businesses and not for speculative purposes);
(gix) the Guarantee incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in the ordinary course of business solely in respect of performance, surety and similar bonds, completion or performance guarantees or standby letters of credit issued for the purpose of supporting workers' compensation liabilities of the Company or any of its Restricted Subsidiaries, to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others;
(x) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary;
(xi) the incurrence by a Restricted Subsidiary of the Company of Indebtedness in connection with and in contemplation of, the concurrent disposition of such Restricted Subsidiary to the stockholders of the Company; PROVIDED that such disposition occurs concurrently with such incurrence and following such disposition, neither the Company nor any of its Restricted Subsidiaries has any liability with respect to such Indebtedness;
(xii) the incurrence by a Securitization Entity of Indebtedness in a Qualified Securitization Transaction that is Non-Recourse Debt with respect to the Company and its other Restricted Subsidiaries (except for Standard Securitization Undertakings and Limited Originator Recourse);
(xiii) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;; and
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jxiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (jxiv), not to exceed $5.0 75.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxiv) above, above as of the date of incurrence thereof or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09 as of the date of incurrence thereof, the Company shall be permitted to shall, in its sole discretion, classify or reclassify such item of Indebtedness on as of the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, incurrence thereof in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that so long as no Default or Event of Default has occurred and is continuing, the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and Stock if:
(i) the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if Riviera Black Hawk is Operating;
(ii) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. ;
(iii) the Weighted Average Life to Maturity of such Indebtedness is greater than the remaining Weighted Average Life to Maturity of the Notes; The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness so long as no Default or Event of Default has occurred and is continuing (collectively, "Permitted Debt"):
(ai) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(ba) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or Series B Notes to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement and (b) their respective obligations arising under the Collateral Documents to the extent such obligations would represent Indebtedness;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(dii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (ai), (bii), (cvi), (dviii) or (jx) of this paragraph;
(eiii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
(ia) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and thereof, (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e)iii) and (3) if any Restricted Subsidiary is the obligor on such Indebtedness, such Indebtedness is represented by an Intercompany Note that is pledged to the Trustee as security for the Notes;
(fiv) the incurrence by the Company or any of its the Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gv) the incurrence by the Company of Indebtedness solely in respect of performance or similar bonds or standby letters of credit; provided that any such bond or standby letter of credit is incurred in the ordinary course of the Company's business in an aggregate amount not to exceed $2.0 million at any one time outstanding; and provided, further, that any such bond or standby letter of credit is incurred on terms customary for operations similar to the Company's;
(vi) the incurrence by the Company of FF&E Financing; provided, however, that (a) the principal amount of such Indebtedness does not exceed the cost (including sales and excise taxes, installation and delivery charges and other direct costs of, and other direct expenses paid or charged in connection with, such purchase) of the FF&E purchased or leased with the proceeds thereof, (b) no Indebtedness incurred under the Notes is utilized for the purchase or lease of such FF&E and (c) the aggregate principal amount of such Indebtedness, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause, does not exceed $15.0 million outstanding at any time;
(vii) bond or surety obligations posted by the Company or any of its Subsidiaries in order to prevent the loss or material impairment of or to obtain a Gaming License or as otherwise required by an order of any Gaming Authority to the extent required by applicable law and consistent in character and amount with customary industry practice so long as such Indebtedness does not result in, and is not secured by, a Lien on any of the Collateral;
(viii) the incurrence by the Company of Indebtedness solely in respect of Special Assessment Bonds, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause, and standby letters of credit or surety bonds required to be issued in connection therewith, in an aggregate amount not to exceed $400,000;
(ix) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was Indebtedness permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jx) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j)clause, not to exceed $5.0 2.0 million; and
(kxi) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, ; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute be an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (kxi). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxi) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09.
Appears in 1 contract
Samples: Indenture (Riviera Black Hawk Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt)) other than Permitted Debt, and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness that is not secured by any Lien (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Subsidiary Guarantors may incur Indebtedness that is not secured by any Lien (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Adjusted Leverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 issued, as the case may be, would have been at least 2.0 no more than 5.00 to 1, 1 determined on a pro forma basis basis, (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;.
(b) the incurrence by the The Company will not incur, and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or will not permit any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligationsto incur, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Restricted Subsidiary unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the Note Guarantee of such Restricted Subsidiary on substantially identical terms; provided, however, that no Indebtedness of the Company shall will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or a Restricted Subsidiary solely by virtue of being (i) unsecured. , (ii) secured on a first or junior Lien basis or (iii) junior in right of distribution of collateral proceeds.
(c) For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k15) aboveof the definition of Permitted Debt, or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09(a), the Company shall will be permitted permitted, in its sole discretion, to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under the Credit Agreement relating to revolving credit borrowings outstanding on the date on which Notes are first issued and authenticated under this Indenture will initially be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt. The accrual of interest, accrual of dividends on Disqualified Stock, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case (other than any reclassification of preferred stock as indebtedness due to a change in accounting principles), that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued and will constitute Consolidated Indebtedness once incurred. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
(d) The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the Fair Market Value of such assets at the date of determination; and
(b) the amount of the Indebtedness of the other Person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and that the Company shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's its Restricted Subsidiaries may incur Indebtedness or and Restricted Subsidiaries of the Company may issue preferred stock, shares of Preferred Stock if the Fixed Charge Coverage Ratio for the Company's Adjusted Consolidated Leverage Ratio would have been less than 4.5 to 1, on a pro forma basis after giving effect to the incurrence of such Indebtedness or the issuance of such Preferred Stock, as the case may be, and the application of the net proceeds therefrom. Notwithstanding the foregoing, the Company and, to the extent set forth below, its Restricted Subsidiaries may incur the following (each of which shall be given independent effect):
(a) Indebtedness of the Company under the Notes and this Indenture;
(b) Permitted Working Capital Indebtedness of the Company and its Restricted Subsidiaries;
(c) Existing Indebtedness (other than Permitted Working Capital Indebtedness or Indebtedness under the Letter of Credit Facility);
(d) Indebtedness of the Company and its Restricted Subsidiaries under the Letter of Credit Facility;
(e) Capital Expenditure Indebtedness, Capital Lease Obligations and purchase money Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $70.0 million at any time outstanding;
(i) Hedging Obligations of the Company and its Restricted Subsidiaries covering Indebtedness of the Company or such Restricted Subsidiary (which Indebtedness is otherwise permitted to be incurred under this covenant) to the extent the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates; or (ii) repurchase agreements, reverse repurchase agreements or similar agreements relating to marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; provided that the terms of such agreements comply with the guidelines set forth in Federal-Financial Agreements of Depository Institutions with Securities and Others (or any successor guidelines), as adopted by the Comptroller of the Currency;
(g) Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $45.0 million at any time outstanding;
(h) Indebtedness of the Company representing guarantees of Indebtedness incurred by one of its Restricted Subsidiaries pursuant to, and in compliance with, another provision of this covenant;
(i) Indebtedness of the Company or any of its Restricted Subsidiaries representing guarantees of a portion of the Indebtedness of Wheeling-Nisshin which is not greater than the Company's or such Restricted Subsidiary's pro rata ownership of the outstanding Equity Interests in Wheeling-Nisshin; provided, however, that (i) in the case of a guarantee of any such Indebtedness by the Company, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and (ii) at the time of incurrence and after giving effect to the Indebtedness of Wheeling-Nisshin which is being guaranteed, the Consolidated Interest Coverage Ratio of Wheeling-Nisshin for its most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the any additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bj) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such its Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Subsidiaries representing guarantees of Indebtedness incurred of Wheeling-Nisshin required to refund, refinance or replace any Indebtedness incurred be made pursuant to this clause (c), the Letter of Undertaking not to exceed $2.5 million at any time outstanding10.0 million;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(ek) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);; and
(fl) any Permitted Refinancing Indebtedness representing a replacement, re- newel, refinancing or extension of all or any portion of the Indebtedness permitted under the first paragraph and clauses (a) and (c) of this covenant. In the event that the incurrence by the Company or of any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is would be permitted by the terms first paragraph set forth above or one or more of this Indenture to be outstanding;
(g) the Guarantee by provisions set forth in the second paragraph above, the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
may designate (h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with an officer's certificate delivered to the same terms, and Trustee) the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes particular provision of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes Indenture pursuant to Article 8 hereofwhich it is incurring such Indebtedness.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, “incur”), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of Disqualified Stock or preferred stock; provided, however, that the Company or any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, Stock and the Company's Subsidiaries any Restricted Subsidiary may incur Indebtedness or issue preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, 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 or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph .
(b) Subsection (a) of this Section 4.09 4.9 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(ai) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (i) not to exceed $2,500.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Note Guarantors of Indebtedness represented by the Notes, Initial Notes (including the Junior Notes Note Guarantees and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior any future Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees);
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, in an aggregate amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iv), not to exceed the greater of (x) $275.0 million and (y) 1.0% of Consolidated Total Assets at any time outstanding;
(v) mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such any Restricted SubsidiarySubsidiary of the Company, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (cv), not to exceed the greater of (x) $2.5 675.0 million and (y) 2.5% of Consolidated Total Assets at any time outstanding;
(dvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.9(a) hereof or clauses (ii), (iii), (xii) or (xiv) of this Section 4.09 or clauses (a), (b), (c), (d4.9(b) or this clause (jvi) or, solely to the extent of the excess (if any) of the amount of Indebtedness incurred and outstanding under clause (xx) of this paragraphSection 4.9(b) prior to the applicable refinancing over the maximum aggregate amount permitted to be incurred and outstanding under clause (xx) of this Section 4.9(b) at the time of such refinancing, clause (xx) of this Section 4.9(b);
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any a Note Guarantor is the obligor on such IndebtednessIndebtedness and the obligee is not the Company or another Note Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was is not permitted by this clause (evii);
(fviii) (i) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred and not for speculative purposes and (ii) the purpose incurrence by a Securitization Special Purpose Entity of fixing Indebtedness in a Qualified Securitization Transaction that is without recourse to the Company or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by other Restricted Subsidiary of the terms of this Indenture to be outstandingCompany or their assets (other than Standard Securitization Undertakings);
(gix) the Guarantee by the Company or any Restricted Subsidiary of the Guarantors Company of Indebtedness of the Company or a any Restricted Subsidiary of the Company that was permitted to be incurred by another provision of under this Section 4.094.9 (other than the Note Guarantees); provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes or any Note Guarantee, then the Guarantee shall be subordinated to the same extent as the Indebtedness guaranteed (without regard to security interest);
(hx) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09covenant; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(ixi) obligations in respect of performance and surety bonds and completion guarantees or similar obligations provided by the Company or any Restricted Subsidiary of the Company in each case in the normal course of business (whether or not consistent with past practice);
(xii) the incurrence by the Company or any of its Restricted Subsidiaries of Acquired Debt; provided, however, that on the date of acquisition and after giving effect thereto on a pro forma basis, the Fixed Charge Coverage Ratio of the Company (A) would be at least 2.0 to 1.0 or (B) would be equal to or greater than such Fixed Charge Coverage Ratio immediately prior to such acquisition;
(xiii) the incurrence by any Foreign Subsidiary of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xiii), not to exceed the greater of (x) $675.0 million or (y) 2.5% of Consolidated Total Assets;
(xiv) Indebtedness of the Company or any Restricted Subsidiary incurred in connection with or in contemplation of, or to provide all or any portion of the funds or credit support utilized to consummate, the acquisition by the Company or any Restricted Subsidiary of the Company of property used or useful in a Permitted Business (whether through the direct purchase of assets or the purchase of Capital Stock of, or merger or consolidation with, any Person owning such assets); provided, however, on the date of such incurrence and after giving effect thereto on a pro forma basis, the Fixed Charge Coverage Ratio of the Company (A) would be at least 2.0 to 1.0 or (B) would be equal to or greater than such Fixed Charge Coverage Ratio immediately prior to such incurrence;
(xv) Indebtedness incurred by the Company or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including letters of credit in respect of workers’ compensation claims, death, disability or other employee benefits or property, casualty or liability insurance or self-insurance, or other Indebtedness with respect to reimbursement-type obligations regarding workers’ compensation claims; provided, however, that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within 30 days following such drawing or incurrence;
(xvi) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds, provided that such Indebtedness is extinguished within five Business Days of notice of its incurrence;
(xvii) Indebtedness of the Company or any of its Restricted Subsidiaries supported by a letter of credit issued pursuant to the extent that Credit Facilities, in a principal amount not in excess of the Net Proceeds thereof are promptly:stated amount of such letter of credit;
(xviii) Indebtedness of the Company or any of its Restricted Subsidiaries consisting of (i) used to purchase Notes tendered in an offer to purchase made as a result the financing of a Change in Control, or
insurance premiums or (ii) deposited to defease take-or-pay or similar obligations contained in supply arrangements, in each case, incurred in the Notes pursuant to Article 8 hereof.ordinary course of business;
(jxix) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jxix), not to exceed the greater of (x) $5.0 million675.0 million and (y) 2.5% of Consolidated Total Assets; and
(kxx) the incurrence by the Company's Unrestricted Company or any of its Restricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness secured by a Restricted Subsidiary Lien under Credit Facilities in an aggregate principal amount such that, on a pro forma basis (including a pro forma application of the Company that was proceeds therefrom), the Secured Leverage Ratio would not permitted by this clause exceed 3.00 to 1.00.
(k). c) The Company shall not, and shall not permit any Note Guarantor to, incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or the Note Guarantors unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company or the Note Guarantors shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or any Note Guarantor solely by virtue of being unsecured. unsecured or having a junior lien priority.
(d) For purposes of determining compliance with this Section 4.094.9, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxx) aboveof Section 4.9(b) hereof, or is entitled to be incurred pursuant to the first paragraph subsection (a) of this Section 4.094.9, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify from time to time all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.094.9. Indebtedness permitted by this Section 4.9 need not be permitted solely by reference to one clause permitting such Indebtedness but may be permitted in part by one such clause and in part by one or more other clauses of this Section 4.9 permitting such Indebtedness. Indebtedness under Credit Facilities outstanding on the Issue Date will be deemed to have been incurred on such date in reliance on the exception provided by clause (xx) of Section 4.9(b) hereof.
(e) In addition, for purposes of determining compliance with this Section 4.9, the Company or the applicable Restricted Subsidiary may, pursuant to an Officers’ Certificate delivered to the Trustee, elect to treat all or any portion of the commitment under any Indebtedness (including with respect to any revolving loan commitment) as being incurred at the time of such commitment, in which case any subsequent incurrence of Indebtedness under such commitment shall not be deemed to be an incurrence at such subsequent time.
Appears in 1 contract
Samples: Indenture (Valeant Pharmaceuticals International, Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company Issuer shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Issuer may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if Stock if: the Fixed Charge Coverage Ratio for the CompanyGuarantor's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 In addition, the Issuer shall not prohibit the incurrence of incur any Indebtedness that is contractually subordinated to any other Indebtedness of the following items Issuer unless such Indebtedness is also contractually subordinated to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Issuer shall be deemed to be contractually subordinated to any other Indebtedness (collectively, "Permitted Debt"):of the Issuer solely by virtue of being unsecured. The foregoing provisions shall not apply to:
(ai) the incurrence by the Company Issuer of Indebtedness under the New Credit Facility;
(ii) Guarantees of the Indebtedness under the New Credit Facility required by the New Credit Facility and Guarantees permitted under or required by this Indenture;
(iii) the incurrence by the Issuer and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors Issuer of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date incurrence by Restricted Subsidiaries of the Junior Note Guarantees required or permitted to be incurred under this Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(cv) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company Issuer or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 5.0 million at any time outstanding;
(dvi) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of Indebtedness in connection with the acquisition of assets or a new Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Subsidiary prior to such acquisition by the Issuer or one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Issuer or one of it Restricted Subsidiaries; and provided further that the principal amount (or accreted value, as applicable) of such Indebtedness, together with any other outstanding Indebtedness incurred pursuant to this clause (vi), does not exceed $5.0 million;
(vii) the incurrence by the Issuer or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(eviii) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Issuer and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor Issuer is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuer or a Wholly Owned Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Issuer or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Issuer or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(fix) the incurrence by the Company Issuer or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of New Credit Facility or this Indenture to be outstanding;; and
(gx) the Guarantee by the Company Issuer or any of the Guarantors of Indebtedness of the Company Issuer or a Restricted Subsidiary of the Company Issuer that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 section hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09section hereof, the Company shall be permitted to Issuer shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09section hereof and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness shall not be deemed to be an incurrence of Indebtedness for purposes of this covenant.
Appears in 1 contract
Samples: Indenture (Anchor Holdings Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) or issue Disqualified Stock, and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock except for preferred stock issued to and held by the Company or any Wholly-Owned Restricted Subsidiary of the Company, provided that any subsequent issuance or transfer of Capital Stock that results in such Wholly-Owned Restricted Subsidiary ceasing to be a Wholly-Owned Restricted Subsidiary of the Company or any subsequent transfer of such preferred stock (other than to the Company or any of its Wholly-Owned Restricted Subsidiaries) will be deemed, in each case, to constitute the issuance of such preferred stock by the issuer thereof; provided, however, that the Company or any Subsidiary may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, Stock and the Company's Subsidiaries any Subsidiary may incur Indebtedness or issue preferred stockstock if, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding on the date on which of such additional Indebtedness is incurred incurrence or such Disqualified Stock or preferred stock is issued would have been at least issuance and after giving effect thereto, the Consolidated Leverage Ratio does not exceed 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;1.0.
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;The foregoing provisions will not apply to:
(ci) the incurrence by the Company or any of its Restricted Subsidiaries Subsidiary of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of (A) assets (other than Receivables or Servicing Rights to be used in a Permitted Business; or (B) construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 million at in the aggregate as of any time outstanding;date an amount equal to 15% of Consolidated Tangible Equity Capital as of such date.
(dii) the existence of Warehouse Facilities, regardless of amount, and the incurrence of Permitted Warehouse Debt by the Company or any of its Restricted Subsidiaries Subsidiaries; provided, however, that to the extent any such Indebtedness of the Company or a Restricted Subsidiary of the Company ceases to constitute Permitted Refinancing Warehouse Debt, to such extent such Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture shall be deemed to be incurred under by the first paragraph Company or such Restricted Subsidiary of this Section 4.09 or clauses (a)the Company, (b)as the case may be, (c), (d) or (j) of this paragraphat such time;
(eiii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among owing to the Company and or any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1x)(A) any subsequent issuance or transfer of Equity Interests that any Capital Stock which results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company Company, shall be deemed, in each case, to constitute an the incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, and (y) any Indebtedness of the Company to any Restricted Subsidiary is permitted by Section 4.7 hereof;
(iv) the incurrence by the Company of Indebtedness represented by the Notes;
(v) Indebtedness of the Company and its Restricted Subsidiaries outstanding on the Issue Date;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness with respect to Indebtedness that was not permitted by this clause (e)Indenture to be incurred or that was outstanding at the Issue Date;
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect directly related to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gw) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted by this Indenture to be incurred, (x) Servicing Rights and Receivables held by the Company or a Restricted Subsidiary pending sale, (y) Receivables of the Company or a Restricted Subsidiary that have been sold pursuant to a Warehouse Facility; or (z) Servicing Rights and Receivables that the Company or a Restricted Subsidiary reasonably expects to purchase or commit to purchase, finance or accept as collateral; provided, however, that, in the case of each of the foregoing clauses (w) through (z), such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company and its Restricted Subsidiaries on the Issue Date;
(viii) the incurrence of Acquired Debt by the Company of any Subsidiary in a principal amount not to exceed $5 million in the aggregate since the Issue Date (reduced by the amount of Acquired Debt repaid with Net Proceeds of Asset Sales of the Restricted Subsidiary acquired subject to such Acquired Debt) that is without recourse to the Company or any of its Restricted Subsidiaries or any of their respective assets (other than the Subsidiary acquired subject to such Acquired Debt), and is not guaranteed by any such Person;
(ix) the Guarantee by the Company or any Subsidiary of the Indebtedness of the Company or another Subsidiary that was permitted to be incurred by another provision of this Section 4.094.9;
(hx) the accrual incurrence by the Company and the Restricted Subsidiaries of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in an aggregate principal amount at any time outstanding not to exceed $5 million; and
(A) the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be incurrence by an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges Unrestricted Subsidiary of the Company as accrued;of Non-Recourse Debt (including, without limitation, Non-Recourse Debt that would constitute Permitted Warehouse Debt if
(ic) The Company shall not, and shall not permit any Subsidiary to, incur any Indebtedness that is contractually subordinated to any Indebtedness of the Company or any Restricted such Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. unsecured or of limited recourse.
(d) For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt Indebtedness described in clauses (ai) through (kxi) above, of Section 4.9(b) above or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.9(a), the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant and such item of Indebtedness will be treated as having been incurred pursuant to only one of such clauses or pursuant to Section 4.094.9(a).
Appears in 1 contract
Samples: Indenture (Matrix Capital Corp /Co/)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur",” with “incurrence” having a correlative meaning) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or and issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or (including Acquired Debt) and issue preferred stock, if additional equity investments in the Company are made (other than to redeem or repurchase outstanding Indebtedness), in which case the Company and any of its Restricted Subsidiaries may incur $1.00 of additional Indebtedness for each $1.00 so contributed and the Company has received written confirmation from each of Xxxxx’x and S&P or any successor thereto, or if there is no such successor, another “nationally recognized statistical rating organization” registered with the Commission that no Ratings Decline will occur as a result of the incurrence of such additional Indebtedness.
(b) Notwithstanding the foregoing, the provisions of Section 4.09(a) hereof will not prohibit the incurrence of any of the following (the items of Indebtedness described below in this Section 4.09(b) being referred to collectively as “Permitted Debt”):
(1) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes and the related Note Guarantees to be issued on the date of this Indenture and the Exchange Notes and the related Note Guarantees to be issued pursuant to the Registration Rights Agreement;
(2) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Section 4.09(a) hereof or clauses (1), (2) and (14) of this Section 4.09(b);
(3) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (3);
(4) the incurrence, assumption or creation of obligations of the Company or a Restricted Subsidiary pursuant to the Assumption Agreement;
(5) the incurrence, assumption or creation of obligations of the Company or a Restricted Subsidiary pursuant to Interest Rate and Currency Xxxxxx;
(6) the incurrence of a guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; provided that if the Indebtedness being guaranteed is Subordinated Indebtedness, then the guarantee shall be subordinated to the same extent as the contractual subordination applicable to the Indebtedness guaranteed;
(7) the incurrence by the Company of Indebtedness in an amount not to exceed $100.0 million in respect of (i) cost overruns of the construction, cool down, commissioning and completion of Phase 1 and Phase 2-Stage 1 and (ii) to finance the restoration of the Project following an Event of Loss;
(8) the incurrence by the Company of Indebtedness in respect of working capital in an amount not to exceed $20.0 million (subject to a temporary increase, in an amount not to exceed $75.0 million, such increase to terminate not later than December 31, 2010, to fund the purchase of LNG for cool down of the Project and the entering into by the Company of any commodity hedging arrangements relating to such LNG);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance bonds, completion bonds, bid bonds, appeal bonds and surety bonds or other similar bonds or obligations, and any guarantees or letters of credit functioning as or supporting any of the foregoing;
(10) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided that such Indebtedness is extinguished within five Business Days of its incurrence;
(11) the incurrence by the Company of Indebtedness to the extent that the net proceeds thereof are promptly deposited to defease or to satisfy and discharge the Notes;
(12) Indebtedness consisting of the financing of insurance premiums in customary amounts consistent with the operations and business of the Company and its Restricted Subsidiaries in the ordinary course of business;
(13) Subordinated Indebtedness between or among the Company and/or any of its Restricted Subsidiaries; and
(14) the incurrence by the Company or the Guarantors of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (14), not to exceed $25.0 million. In addition to Permitted Debt described in clauses (1) through (14) above, the Company may incur additional Indebtedness (other than Parity Secured Debt) (the “Additional Indebtedness”) so long as (i) the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters (or if fewer than four fiscal quarters have elapsed since the achievement of Phase 1 Target Completion, the number of full fiscal quarters that have elapsed) for which internal financial statements are available immediately preceding the date on which such additional Additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued issued, as the case may be, would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Additional Indebtedness had been incurred or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness period and (collectively, "Permitted Debt"):
(aii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) has received written confirmation from two Credit Rating Agencies that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made no Ratings Decline will occur as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredAdditional Indebtedness. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k14) above, or is entitled to be incurred pursuant to the first paragraph of Section 4.09(a) hereof or this Section 4.094.09(b), the Company shall will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the Fair Market Value of such asset at the date of determination; and
(b) the amount of the Indebtedness of the other Person; and
(3) the principal amount of the Indebtedness, in the case of any other Indebtedness.
Appears in 1 contract
Samples: Indenture (Cheniere Energy Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectivelyin any such case, "incurINCUR") any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, PROVIDED that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Mirror Note Issuers and the Guarantors may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.5 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph ; PROVIDED FURTHER that a Restricted Subsidiary may issue preferred stock to the Company or to a Wholly Owned Restricted Subsidiary of this the Company, or in a transaction or series of related transactions consisting of a sale of such Restricted Subsidiary; PROVIDED that immediately after giving effect to such sale, neither the Company nor any of its Subsidiaries owns any Equity Interests of such Restricted Subsidiary and such sale complies with Section 4.09 shall 4.06.
(b) Section 4.05(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtPERMITTED DEBT"):
(a1) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness, letters of guarantee, tender cheques and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of guarantee, tender cheques and letters of credit being deemed to have a principal amount equal to the Existing Indebtedness;
(b) the incurrence by maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;greater of
(ci) Cdn.$256.0 million, less the incurrence aggregate amount of all Net Cash Proceeds of Asset Sales that have been applied by the Company or any of its Restricted Subsidiaries since the Issue Date to permanently repay any term Indebtedness under a Credit Facility pursuant to Section 4.06 and less the -38- aggregate amount of all commitment reductions with respect to any revolving credit borrowings under a Credit Facility that have been made by the Company or any of its Restricted Subsidiaries since the Issue Date as a result of the application of Net Cash Proceeds of Asset Sales pursuant to Section 4.06; and
(ii) Cdn.$30.0 million plus 20% of Adjusted Consolidated Net Tangible Assets as of the date on which such additional Indebtedness is incurred, and after giving effect to the incurrence of such Indebtedness (and including any assets acquired with such Indebtedness);
(2) Existing Indebtedness;
(3) the incurrence by the Company, the Mirror Note Issuers and the Guarantors of Indebtedness represented by the Notes to be issued on the Issue Date, the Mirror Notes, the Mirror Note Guarantees and the Subsidiary Guarantees;
(4) the incurrence by the Company, any Mirror Note Issuer or any Guarantor of Indebtedness and Obligations represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction construction, development or improvement of property, plant or equipment equipment, including Facilities, used in the business of the Company Company, such Mirror Note Issuer or such Restricted SubsidiaryGuarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed $2.5 U.S.$10.0 million at any time outstanding;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Section 4.05(a) or clauses (2), (3) (with respect to the first paragraph Notes only) or (5) of this Section 4.09 or clauses (a4.05(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness or the issuance of preferred stock between or among the Company and any of its Restricted Subsidiaries; provided, however, PROVIDED that:
(ia) if the Company Company, any Mirror Note Issuer or any Guarantor is the obligor on such IndebtednessIndebtedness or preferred stock, such Indebtedness or preferred stock must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantorunsecured; and
(1b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness or preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness or the issuance of preferred stock by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e6);
(f7) the incurrence by the Company Company, any Mirror Note Issuer or any of its Restricted Subsidiaries Guarantor of Hedging Obligations; PROVIDED that such Hedging Obligations that are were incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(g) 8) the Guarantee guarantee by the Company Company, any Mirror Note Issuer or any of the Guarantors Guarantor of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.094.05 or required to be incurred by this Indenture;
(h9) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock or preferred stock in the form of additional shares of the same class of Disqualified Stock shall or preferred stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock or preferred stock for purposes of this Section 4.094.05; providedPROVIDED, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i10) the incurrence by the Company, any Mirror Note Issuer or any Guarantor of Indebtedness and Obligations under Oil and Gas Hedging Contracts; PROVIDED that such Oil and Gas Hedging Contracts were entered into in the ordinary course of business and not for speculative purposes;
(11) production imbalances arising in the ordinary course of business;
(12) Indebtedness and Obligations in connection with one or more standby letters of credit, Guarantees, performance or surety bonds or other reimbursement obligations, in each case, issued in the Company ordinary course of business and not in connection with the borrowing of money or the obtaining of an advance or credit (other than advances or credit for goods and services in the ordinary course of business and on terms and conditions that are customary in the Oil and Gas Business, and other than the extension of credit represented by such letter of credit, Guarantee or performance or surety bond itself);
(13) the incurrence by the Company, any Mirror Note Issuer or any Restricted Subsidiary Guarantor of Non-Recourse Purchase Money Debt in an amount not to the extent that the Net Proceeds thereof are promptly:exceed U.S.$20.0 million outstanding at any one time;
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j14) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j14), not to exceed $5.0 U.S.$25.0 million;
(15) Indebtedness of the Company, any Restricted Subsidiary, any Mirror Note Issuer or any Guarantor arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds in the ordinary course of business;
(16) Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of business;
(17) Indebtedness of the Company or any Restricted Subsidiary (including letters of credit), for the account of the Company or any such Restricted Subsidiary incurred in order to provide security for environmental reclamation obligations to governmental agencies, workers' compensation claims, payment obligations in connection with self-insurance or similar statutory and other requirements in the ordinary course of business; and
(k18) the incurrence by the Company's Unrestricted Subsidiaries customary indemnification, adjustment of Non-Recourse Debtpurchase price or similar obligations, providedincluding title insurance, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur or any Indebtedness (including Permitted Debt) that is contractually subordinated Restricted Subsidiary, in right each case, incurred in connection with the acquisition or disposition of payment to any other Indebtedness assets of the Company unless or any such Indebtedness is also contractually subordinated in right Restricted Subsidiary (other than Guarantees incurred by any Person acquiring all or any portion of payment to such assets for the Notes on substantially identical terms; provided, however, that no Indebtedness purpose of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredfinancing such acquisition). For purposes of determining compliance with this Section 4.094.05, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k18) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.05(a), the Company shall will be permitted to classify classify, or later reclassify, such item of Indebtedness on the date of its incurrence, in whole or later reclassify all or a portion of such item of Indebtedness, in part in any manner that complies with this Section 4.094.05, including by allocation to more than one other type of Indebtedness. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture will be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of this Section 4.05(b). The maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.05 will not be deemed to be exceeded solely as the result of fluctuations in the exchange rates of currencies. In determining the amount of Indebtedness outstanding under one of the clauses above, the outstanding principal amount of any particular Indebtedness of any Person shall be counted only once and any obligation of such Person or any other Person arising under any Guarantee, Lien, letter of credit or similar instrument supporting such Indebtedness shall be disregarded so long as it is permitted to be incurred by the Person or Persons incurring such obligation.
(c) None of the Company, any Mirror Note Issuer or any Guarantor shall incur any additional Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of such Person unless such additional Indebtedness is also contractually subordinated in right of payment to the Notes, the applicable Mirror Note or the applicable Mirror Note Guarantee or Subsidiary Guarantee, as the case may be, on substantially identical terms; PROVIDED, HOWEVER, that no Indebtedness of the Company will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured.
Appears in 1 contract
Samples: First Supplemental Indenture (Paramount Resources LTD)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), other than Permitted Debt, and the Company shall not issue any Disqualified Stock issue, and shall not permit any of its Restricted Subsidiaries to issue issue, any shares of preferred stockDisqualified Stock; provided, however, that the Company or any Guarantor may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and Stock if the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the such additional Indebtedness had been incurred incurred, or the preferred stock or such Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual . Accrual of interest, the accretion or amortization of original issue discount, accreted value and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that . In the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted case an Unrestricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of incurs Non-Recourse Debt, provided, however, that if Indebtedness and any such Non-Recourse Indebtedness ceases to be Non-Recourse Debt Indebtedness of an such Unrestricted Subsidiary, then such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by is subject to this clause (k)Section 4.09. The Company shall will not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness (including Acquired Debt) meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to will, in its sole discretion, classify (or later reclassify) in whole or in part such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness or a portion thereof may be classified (or later reclassified) in whole or in part as having been incurred under more than one of the applicable clauses or pursuant to the first paragraph of this Section 4.09. Notwithstanding the foregoing, no Pipeline Subsidiary shall incur or maintain any Indebtedness or grant or become or remain subject to any Lien upon any of its property securing Indebtedness, except (i) liabilities outstanding on the Issue Date in respect of the Company's outstanding 9% Senior Subordinated Notes due 2008, 9-5/8% Senior Subordinated Notes due 2008 and 9-5/8% Senior Subordinated Notes due 2012, (ii) guarantees of the Notes (including any additional Notes) and Term Loans (including any additional Term Loans) and Liens securing Secured Obligations and (iii) Permitted Liens.
Appears in 1 contract
Samples: Indenture (Tesoro Petroleum Co Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries other than the Bank or any Subsidiary of the Bank to issue any shares of preferred stockPreferred Stock; provided, however, that the Company or any Subsidiary may incur Indebtedness (including Acquired Debt) or any Subsidiary may issue Disqualified StockPreferred Stock if, on the date of such incurrence and after giving effect thereto, the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Consolidated Leverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least does not exceed 2.0 to 11.0, 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 preferred stock or Disqualified Stock had been issued, as 1.5 to 1.0 in the case may be, at of any Indebtedness in a principal amount in excess of $75,000,000 (less any subordinated Indebtedness issued pursuant to the beginning of such four-quarter periodRecapitalization Agreement) which is subordinated to the Notes. The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(a) the incurrence by Indebtedness of the Company and its Restricted Subsidiaries existing on the date of the Existing Indebtednessthis Indenture;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Convertible Subordinated Debt and up to $75,000,000 of Indebtedness (less any subordinated Indebtedness issued pursuant to the Recapitalization Agreement) which is subordinated to the Notes and which matures after the related Subsidiary Guarantees to be issued on the date of this Indenture and the date Stated Maturity of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyNotes;
(c) the incurrence of Permitted Warehouse Indebtedness by the Company or any of its Restricted Subsidiaries Subsidiaries, and any Guarantee by the Company of such Indebtedness represented incurred by Capital Lease Obligationsa Subsidiary, mortgage financings or purchase money obligationsprovided, in each casehowever, incurred for that to the purpose of financing all or extent any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business such Indebtedness of the Company or a Subsidiary ceases to constitute Permitted Warehouse Indebtedness, such Restricted Indebtedness shall be deemed to be incurred at such time by the Company or such Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingas the case may be;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under or that was outstanding at the first paragraph date of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphIndenture;
(e) the incurrence by the Company or a Subsidiary of Hedging Obligations directly related to (i) Indebtedness of the Company or a Subsidiary incurred in conformity with the provisions of this Indenture, (ii) Receivables held by the Company or its Subsidiaries pending sale, (iii) Receivables of the Company or its Subsidiaries that have been sold, (iv) Receivables that the Company or a Subsidiary reasonably expects to purchase or commit to purchase, finance or accept as collateral, or (v) other assets owned or financed by the Company or its Subsidiaries in the ordinary course of business; provided, however, that, in the case of each of the foregoing clauses (i) through (v), such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company and its Subsidiaries on the date of this Indenture;
(f) Indebtedness of the Subsidiaries to the Company to the extent that such Indebtedness constitutes a Permitted Investment of the Company of the type permitted under the definition of Permitted Investments;
(g) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among owing to the Company and or any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that any Capital Stock which results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an the incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries a Subsidiary of Non-Recourse Debt, ; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted the Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company;
(i) the maintenance by the Company that was not permitted or any of its Subsidiaries of Indebtedness incurred to finance Receivables or repurchase facilities in the ordinary course of business; and
(j) the incurrence by this clause (k). The the Company shall not incur any and its Subsidiaries of Indebtedness (including Permitted Debt) that is contractually subordinated in right an aggregate principal amount which, together with the principal amount of payment to any other all Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness and its Subsidiaries outstanding on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with incurrence (other than Indebtedness otherwise permitted by this Section 4.094.10), does not exceed $25,000,000.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (including by way of merger, consolidation or acquisition), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue or incur any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue or incur any shares of preferred stockPreferred Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue or incur shares of Disqualified Stock, Stock and the Company's its Restricted Subsidiaries may incur Indebtedness Acquired Debt or issue preferred stock, Acquired Preferred Stock if either:
(i) the Fixed Charge Coverage Consolidated Leverage Ratio for at the end of the Company's most recently ended four full fiscal quarters quarter (the "Reference Period") for which internal financial statements are a consolidated balance sheet of the Company is available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Preferred Stock or preferred stock is issued or incurred would have been at least 2.0 less than 5.5 to 11.0 (if the Reference Period ends on or prior to December 31, 2001), or 5.0 to 1.0 (if the Reference Period ends subsequent to December 31, 2001), determined on a pro forma basis (including including, a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Preferred Stock had been issued, as the case may be, at the beginning of the Reference Period; or
(ii) the Consolidated Capital Ratio at the end of the Reference Period would have been less than 2.0 to 1.0, determined after giving effect to the incurrence or issuance of such four-quarter periodIndebtedness or Preferred Stock and on a pro forma basis (including a pro forma application of the net proceeds therefrom). The first Notwithstanding the foregoing, the provisions of the paragraph of this Section 4.09 shall set forth immediately above will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtIndebtedness"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(cb) the incurrence by the Company or any of its Restricted Subsidiaries of Existing Indebtedness;
(c) the incurrence of Indebtedness represented by Capital Lease Obligations, mortgage financings the Company to any Consolidated Subsidiary or purchase money obligations, in each case, incurred for Indebtedness of any Restricted Subsidiary to the purpose of financing all Company or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of Consolidated Subsidiary (but such Indebtedness shall be deemed to be incurred upon such Indebtedness being held by any person other than the Company or such Consolidated Subsidiary including upon Designation and upon such Restricted Subsidiary otherwise no longer being a Consolidated Subsidiary); provided that in the case of Indebtedness of the Company, such obligations shall be unsecured and subordinated in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred respects to refund, refinance or replace any Indebtedness incurred the Company's obligations pursuant to this clause (c), not to exceed $2.5 million at any time outstandingthe Notes;
(d) the incurrence by the Company or of Indebtedness in an aggregate amount incurred and outstanding at any of its Restricted Subsidiaries of time pursuant to this clause (d) (plus any Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used incurred pursuant to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or clause (j) hereof to retire, defease, refinance, replace or refund such Indebtedness) of this paragraphup to $25 million;
(e) the incurrence by the Company, or any Guarantee thereof by any Restricted Subsidiary (other than any Foreign Subsidiary), of Indebtedness pursuant to the Credit Agreement in an aggregate amount incurred and outstanding at any time pursuant to this clause (e) (plus any Permitted Refinancing Indebtedness incurred pursuant to clause (j) hereof to retire, defease, refinance, replace or refund such Indebtedness) of up to $300 million, minus the amount of any such Indebtedness (i) retired with the Net Cash Proceeds from any Asset Sale applied to permanently reduce the outstanding amounts or the commitments with respect to such Indebtedness pursuant to Section 4.10 hereof or (ii) assumed by a transferee in an Asset Sale;
(f) the incurrence by the Company or any of its Restricted Foreign Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted SubsidiariesPurchase Money Indebtedness; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests provided that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness shall not constitute more than 100% of the cost (determined in accordance with GAAP in good faith by the Board of Directors of the Company) to the Company or such Foreign Subsidiary, as applicable, of the case may beproperty so purchased, that was not permitted by this clause (e)developed, acquired, constructed, improved or leased;
(fg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest or foreign currency exchange rate risk with respect to any floating rate Indebtedness or foreign currency based Indebtedness, respectively, that is permitted by the terms of this the Indenture to be outstanding;
(g) ; provided that the Guarantee by notional amount of any such Hedging Obligation does not exceed the Company or any of the Guarantors amount of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted other liability to be incurred by another provision of this Section 4.09which such Hedging Obligation relates;
(h) the accrual incurrence by a Foreign Subsidiary of interestIndebtedness pursuant to a Foreign Subsidiary Credit Agreement (or any Guarantee thereof by any other Foreign Subsidiary) in an aggregate principal amount incurred and outstanding at any time pursuant to this clause (h) (plus any Permitted Refinancing Indebtedness incurred pursuant to clause (j) hereof to retire, defease, refinance, replace or refund such Indebtedness) of up to $150.0 million (or the accretion or amortization equivalent thereof at the time of original issue discount, the payment of interest on any Indebtedness incurrence in the form applicable foreign currencies), minus the amount of additional any such Indebtedness (i) retired with the same terms, and Net Cash Proceeds from any Asset Sale applied to permanently reduce the payment outstanding amounts or the commitments with respect to such Indebtedness pursuant to Section 4.10 hereof or (ii) assumed by a transferee of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedAsset Sale;
(i) Indebtedness of the Company or any and its Restricted Subsidiary Subsidiaries may incur Indebtedness solely in respect of bankers acceptances, letters of credit and performance bonds, all in the ordinary course of business in accordance with customary industry practices, in amounts and for the purposes customary in the Company's industry (other than to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.supporting Indebtedness); and
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueSubsidiaries, as applicable) at any time outstanding, including all of Permitted Refinancing Indebtedness incurred in exchange for, or the net proceeds of which are used to refund, refinance or replace any Indebtedness that was incurred pursuant to the first paragraph hereof or clauses (a), (b), (d), (e), (f), (h) or this clause (j), not to exceed $5.0 million; and
(k) of this paragraph. Indebtedness or Preferred Stock of any Person which is outstanding at the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any time such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by Person becomes a Restricted Subsidiary of the Company (including upon designation of any Subsidiary or other Person as a Restricted Subsidiary or upon a Revocation such that was such Subsidiary becomes a Restricted Subsidiary) or is merged with or into or consolidated with the Company or a Restricted Subsidiary of the Company shall be deemed to have been incurred at the time such Person becomes such a Restricted Subsidiary of the Company or is merged with or into or consolidated with the Company or a Restricted Subsidiary of the Company, as applicable. Upon each incurrence, the Company may designate pursuant to which provision of this covenant such Indebtedness is being incurred and such Indebtedness shall not permitted be deemed to have been incurred by the Company under any other provision of this clause (k)covenant, except as stated otherwise in the foregoing provisions. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, incur any Indebtedness (including Permitted DebtIndebtedness) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any Guarantor may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries Guarantors may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The Company shall not incur any Indebtedness that is contractually subordinated to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated to any other Indebtedness of the Company solely by virtue of being unsecured. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the Existing Indebtednessmaximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceed the greater of:
(i) $1.4 billion less the aggregate amount of all Net Proceeds of Asset Sales that have been applied by the Company or any of its Restricted Subsidiaries since the date of this Indenture to repay any term Indebtedness under a Credit Facility or to repay revolving credit Indebtedness under a Credit Facility and effect a corresponding commitment reduction, in each case with the Net Proceeds of an Asset Sale pursuant to Section 3.09 hereof, and
(ii) the Borrowing Base;
(b) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness and their existing guarantees;
(c) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) Pledge and Escrow agreement and the incurrence by Exchange Notes and the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred related Subsidiary Guarantees to refund, refinance or replace any Indebtedness incurred be issued pursuant to this clause (c), not to exceed $2.5 million at any time outstandingthe registration rights agreement;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (aii), (biii), (c), (div) or (jxv) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, Notes in the case of the Company, or its Note Guarantee, the Subsidiary Guarantee in the case of a Guarantor; , and
(1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company; will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or Hedging Obligations with respect to foreign currency translations;
(g) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant or that was in existence on the date of this Indenture;
(h) the incurrence by a Receivables Subsidiary of Indebtedness in a Qualified Receivables Transaction that is without recourse to the Company or to any Restricted Subsidiary of the Company or their assets (other than such Receivables Subsidiary and its assets and, as to the Company or any Subsidiary of the Company, other than pursuant to representations, warranties, covenants and indemnities customary for such transactions) and is not guaranteed by any such Person;
(i) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(ij) Indebtedness of the Company or a Restricted Subsidiary owed to (including obligations in respect of letters of credit for the benefit of) any Person in connection with worker's compensation, health, disability or other employee benefits or property, casualty or liability insurance provided by such Person to the Company or such Restricted Subsidiary, pursuant to reimbursement or indemnification obligations to such Person, in each case incurred in the ordinary course of business;
(k) Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assume in connection with the disposition of any business, asset or Equity Interests; provided that the maximum aggregate liability of all such Indebtedness shall at no time exceed the gross proceeds actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(l) obligations in respect of performance and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary to in the extent that the Net Proceeds thereof are promptly:ordinary course of business;
(im) used to purchase Notes tendered Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided, however, that such Indebtedness is extinguished within five Business Days of its incurrence;
(n) the incurrence by the Company or any of its Restricted Subsidiaries of guarantees of Indebtedness of customers or suppliers in an offer aggregate amount at any one time outstanding not to purchase made as a result of a Change in Control, orexceed $20.0 million; and
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jo) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jo), not to exceed $5.0 80.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (ko) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall shall, in its sole discretion, be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, Indebtedness in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Samples: Indenture (Omni Med B Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any of its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness Stock or issue preferred stock, stock if the Fixed Charge Coverage Consolidated EBITDA Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 2.25 to
1. 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by Indebtedness of the Company and its Restricted Subsidiaries of under the New Bank Credit Facility;
(ii) Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, Obligations in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 5.0 million at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was is not permitted by this clause (evi);
(fvii) the incurrence Indebtedness consisting of Permitted Hedging Obligations;
(viii) Indebtedness in respect of performance, surety and similar bonds provided by the Company or any in the ordinary course of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(gix) the Guarantee by the Company or any of the Guarantors guarantee of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(hx) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form respect of additional Indebtedness with the same termsindustrial revenue bonds or other similar governmental and municipal bonds, and the payment of dividends on Disqualified Stock mortgage financings or purchase money obligations in the form of additional shares of the same class of Disqualified Stock shall an aggregate amount not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedexceed $5.0 million;
(ixi) Indebtedness in respect of (A) letters of credit (other than letters of credit issued under the New Bank Credit Facility) incurred in the ordinary course of business for the purpose of securing foreign trade credit obligations of the Company or any a Restricted Subsidiary of the Company and (B) Acquired Debt in connection with the acquisition of new assets or a new Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Subsidiary prior to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence acquisition by the Company or any one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or such Restricted Subsidiary; and provided further that the aggregate principal amount (or accreted value, as applicable) of all Indebtedness incurred pursuant to this clause (xi) shall not exceed $5.0 million at any one time outstanding;
(xii) additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jxii), not to exceed $5.0 10.0 million; and
(kxiii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse DebtDebt of an Unrestricted Subsidiary, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was is not permitted by this clause (kxiii). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxiii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall Guarantor will not, and shall will not cause or permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall Guarantor will not and will not permit any of its Subsidiaries to issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided.
(b) Section 4.07(a) shall not, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, without duplication (collectively, "“Permitted Debt"”):
(ai) [reserved];
(ii) the incurrence by the Company Guarantor and its Restricted Subsidiaries of Existing Indebtedness (other than Indebtedness under (i) the Note Guarantee, (ii) Guarantees of the 2029 Guaranteed Notes, (iii) the Specified Facility Second Priority Guarantees and (iv) the Existing IndebtednessECA Facility Third Priority Guarantees);
(biii) the incurrence by the Company and the Guarantors Guarantor of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantee;
(civ) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of Indebtedness represented by Attributable Debt, Capital Lease Obligations, mortgage financings or purchase money obligations, the issuance by the Guarantor of Disqualified Stock and the issuance by any Subsidiary of the Guarantor of preferred stock, in each case, incurred or issued for the purpose of financing all or any part of the purchase price price, lease expense, rental payments or cost of construction design, construction, installation, repair, replacement or improvement of propertyproperty (including Vessels), plant or equipment or other assets (including Capital Stock) used in the business of the Company Issuer or such Restricted Subsidiaryany of its Subsidiaries, in an aggregate principal amountamount or liquidation preference, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred or Disqualified Stock or preferred stock issued pursuant to this clause (civ), not to exceed the greater of $2.5 75.0 million and 0.25% of Total Assets at any time outstandingoutstanding (it being understood that any such Indebtedness may be incurred and such Disqualified Stock and preferred stock may be issued after the acquisition, purchase, charter, leasing or rental or the design, construction, installation, repair, replacement or the making of any improvement with respect to any asset (including Vessels)); provided that any such property (including Vessels), plant or equipment or other assets constitute Priority Assets; provided, further, that the principal amount of any Indebtedness, Disqualified Stock or preferred stock permitted under this clause (iv) did not in each case at the time of incurrence exceed, together with amounts previously incurred and outstanding under this clause (iv) with respect to any applicable Vessel, (A) in the case of a completed Vessel, the book value and (B) in the case of an uncompleted Vessel, 80% of the contract price for the acquisition or construction of such Vessel, in the case of this clause (B), as determined on the date on which the agreement for acquisition or construction of such Vessel was entered into by the Issuer or its Subsidiary, plus, in the case of clauses (A) and (B), any other Ready for Sea Cost of such Vessel plus 100% of any related export credit insurance premium;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of [reserved];
(vi) Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge, any Indebtedness (other than intercompany Indebtedness, Disqualified Stock or preferred stock) that was permitted by this Indenture to be incurred under the first paragraph clause (ii), (iii), (iv) or (vi) of this Section 4.09 or clauses (a4.07(b), (b), (c), (d) or (j) of this paragraph;
(evii) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and Issuer, the Guarantor or any Subsidiary of its Restricted Subsidiariesthe Issuer or the Guarantor; provided, however, provided that:
(iA) if the Company or any Guarantor is the obligor on such Indebtedness, (i) such Indebtedness must be unsecured, (ii) ((a) except in respect of the intercompany current liabilities incurred in the ordinary course of business in connection with the cash management operations of the Issuer and its Subsidiaries and (b) only to the extent legally permitted (the Issuer and its Subsidiaries having completed all procedures required in the reasonable judgment of directors or officers of the obligee or obligor to protect such Persons from any penalty or civil or criminal liability in connection with the subordination of such Indebtedness) expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case Note Guarantee and (iii) no Subsidiary of the Company, Guarantor may be the co-obligor or its Note Guarantee, in the case of a Guarantorguarantor on such Indebtedness; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuer, the Guarantor or a Restricted Subsidiary of the Company Issuer or the Guarantor and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Issuer, the Guarantor or a Restricted Subsidiary of the Company shall Issuer or the Guarantor, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Guarantor or such Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) [reserved];
(ix) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of Hedging Obligations that are incurred and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gx) Guarantees by the Guarantor of Indebtedness (taken together with the Indebtedness of the Guarantor under the Notes) in an aggregate amount not to exceed $1,700 million at any one time outstanding, provided, if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(xi) the Guarantee incurrence by the Company Guarantor or any of the Guarantors its Subsidiaries of Indebtedness (A) in respect of workers’ compensation claims, self-insurance obligations, captive insurance companies and bankers’ acceptances in the Company ordinary course of business; (B) in respect of letters of credit, bankers’ acceptances, surety, bid, performance, travel or appeal bonds, completion guarantees, judgment, advance payment, customs, VAT or other tax guarantees or similar instruments issued in the ordinary course of business of such Person or consistent with past practice or industry practice (including as required by any governmental authority) and not in connection with the borrowing of money, including letters of credit, bankers’ acceptances or similar instruments in respect of self-insurance and workers compensation obligations, or for the protection of customer deposits or credit card payments; (C) arising from the honoring by a Restricted bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds or pursuant to other treasury, depositary and cash management services in the ordinary course of business, so long as such Indebtedness is covered within 30 days; and (D) consisting of (x) the financing of insurance premiums or (y) take-or-pay obligations contained in supply agreements, in each case, in the ordinary course of business;
(xii) Indebtedness, Disqualified Stock or preferred stock (A) of any Person outstanding on the date on which such Person becomes a Subsidiary of the Company that Guarantor or is merged, consolidated, amalgamated or otherwise combined with (including pursuant to any acquisition of assets and assumption of related liabilities) the Guarantor or one of its Subsidiaries or (B) incurred or issued to provide all or any portion of the funds used to consummate the transaction or series of related transactions pursuant to which such Person became a Subsidiary of the Guarantor or was permitted to be incurred otherwise acquired by another provision the Guarantor or a Subsidiary of this Section 4.09the Guarantor;
(hxiii) Indebtedness arising from agreements of the Guarantor or any of its Subsidiaries providing for customary indemnification, obligations in respect of earnouts or other adjustments of purchase price or, in each case, similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets or Person or any Equity Interests of a Subsidiary; provided that (in the case of a disposition) the accrual maximum liability of interestthe Guarantor and its Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including the accretion Fair Market Value of non-cash proceeds (measured at the time received and without giving effect to any subsequent changes in value), actually received by the Guarantor and its Subsidiaries in connection with such disposition;
(xiv) the incurrence by the Guarantor or amortization any of original issue discount, the payment its Subsidiaries of interest on any Indebtedness in the form of additional Indebtedness with the same terms, Unearned Customer Deposits and the payment of dividends on Disqualified Stock advance payments received in the form ordinary course of additional shares business from customers for goods and services purchased in the ordinary course of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedbusiness;
(ixv) Indebtedness of the Company Guarantor or any Restricted Subsidiary to of its Subsidiaries incurred in connection with credit card processing arrangements or other similar payment processing arrangements entered into in the extent that the Net Proceeds thereof are promptly:ordinary course of business;
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jxvi) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of additional Indebtedness Indebtedness, the issuance by the Guarantor or any Subsidiary of Disqualified Stock and the issuance by any Subsidiary of preferred stock to finance the replacement (including Acquired Debtthrough construction or acquisition) of a Vessel upon an Event of Loss of such Vessel in an aggregate principal amount no greater than the Ready for Sea Cost for such replacement Vessel, in each case less all compensation, damages and other payments (including insurance proceeds other than in respect of business interruption insurance) received by the Guarantor or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing of its Subsidiaries from any Person in connection with such Event of Loss in excess of amounts actually used to repay Indebtedness secured by the Vessel subject to such Event of Loss and any costs and expenses incurred to refund, refinance by the Guarantor or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; andof its Subsidiaries in connection with such Event of Loss;
(kxvii) the incurrence by the Company's Unrestricted Guarantor or any of its Subsidiaries of Non-Recourse Debt, provided, however, that if Indebtedness in relation to (A) regular maintenance required on any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company Vessels owned or chartered by the Guarantor or any of its Subsidiaries, and (B) any expenditures that was not permitted are, or are reasonably expected to be, recoverable from insurance on such Vessels;
(xviii) [reserved];
(xix) Indebtedness existing solely by this reason of Pxxxxxxxx Xxxxx described in clause (k). The Company shall not incur any Indebtedness 29) of the definition thereof;
(including Permitted Debtxx) that is contractually subordinated in right of payment to any other [reserved];
(xxi) Indebtedness of the Company unless such Indebtedness is also contractually subordinated Guarantor or any of its Subsidiaries undertaken in right of payment connection with cash management and related activities with respect to the Notes on substantially identical terms; providedIssuer, however, that no any of its Subsidiaries or any joint venture or similar arrangement in the ordinary course of business;
(xxii) Indebtedness of the Company shall be deemed Guarantor or any of its Subsidiaries supported by a letter of credit, bankers’ acceptance or similar instrument issued pursuant to the Credit Facilities, in a principal amount not in excess of the stated amount of such letter of credit;
(xxiii) obligations of the Guarantor or any of its Subsidiaries evidenced by one or more letters of credit, bankers’ acceptances or similar instruments (and, without duplication, reimbursement agreements in respect thereof) incurred in the ordinary course of business of such Person or consistent with past practice or industry practice (including as required by any governmental authority) and not in connection with the borrowing of money;
(xxiv) guarantees of passenger volume or port fees in the ordinary course of business;
(xxv) the Specified Facility Second Priority Guarantees and the Existing ECA Facility Third Priority Guarantees;
(xxvi) any Subordinated Guarantees issued, or to be contractually subordinated issued pursuant to, or in right of payment connection with, any Other Obligations, so long as the lenders or investors party thereto (or an agent acting on their behalf), have entered, or will enter, into a Subordination Agreement (or an amendment thereto, to any other the extent already in effect with respect to the 2029 Guaranteed Notes); and
(xxvii) Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, Guarantor or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date any of its incurrenceSubsidiaries incurred in connection with any bareboat charter, lease or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09similar arrangements.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and shall not, and the Company shall not permit any Subsidiary Guarantor to, issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries that are not Subsidiary Guarantors to issue any shares of preferred stockstock (other than Qualified Subsidiary Stock); provided, however, that the Company or any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue shares of preferred stock (including Disqualified Stock) if, and in each case, (1) the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage to Adjusted Operating Cash Flow Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding as of the date on which such additional Indebtedness is incurred or such preferred stock or Disqualified Stock or preferred stock is issued would have been at least 2.0 7.0 to 11 or less, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at as of the beginning date of such four-quarter periodcalculation and (2) no Default or Event of Default would occur as a consequence thereof. The first paragraph of this Section 4.09 Company shall not, and shall not prohibit the incurrence of permit any Subsidiary Guarantor to, incur any Indebtedness that is contractually subordinated to any other Indebtedness of the following items Company or of such Subsidiary Guarantor, as the case may be, unless such Indebtedness is also contractually subordinated to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, on substantially identical terms; provided, however, that no Indebtedness shall be deemed to be contractually subordinated to any other Indebtedness solely by virtue of being unsecured.
(b) The foregoing provisions shall not apply to (collectively, "Permitted Debt"):
(ai) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt or the issuance by such Unrestricted Subsidiaries of preferred stock; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary or any such preferred stock becomes preferred stock (other than Qualified Subsidiary Stock) of a Restricted Subsidiary, as the case may be, such event shall be deemed to constitute an incurrence of Indebtedness by, or an issuance of preferred stock (other than Qualified Subsidiary Stock) of, as the case may be, a Restricted Subsidiary of the Company;
(ii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness pursuant to one or more Bank Facilities if the aggregate principal amount at any time outstanding incurred pursuant to this clause (ii) does not exceed $50.0 million;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors of Indebtedness represented by under the Subordinated Exchange Notes to pay interest on outstanding Subordinated Notes, ;
(v) Indebtedness under the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cvi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (1) if the Company or a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, and (2)(A) any subsequent issuance or transfer of Equity Interests that result in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (B) any sale or other transfer of such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount not to exceed $25.0 million at any time outstanding, including all Permitted Refinancing Indebtedness Debt incurred pursuant to clause (viii) below to refund, replace or refinance or replace any Indebtedness incurred pursuant to this clause (cvii), not to exceed $2.5 million at any time outstanding;
(dviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(eix) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Debt incurred pursuant to clause (viii) above to refund, replace or among the Company and refinance any of its Restricted SubsidiariesIndebtedness incurred pursuant to this clause (ix), not to exceed $75.0 million; provided, however, that:and
(ix) if the guarantee by the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled permitted to be incurred pursuant to Section 4.09(a) hereof and also meets the first paragraph criteria of this Section 4.09one or more of the categories of Permitted Debt described in clauses (i) through (x) above, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and may from time to time reclassify such item of Indebtedness in any manner in which such item could be incurred at the time of such reclassification. For purposes of this paragraph, "Indebtedness" includes Disqualified Stock and preferred stock (other than Qualified Subsidiary Stock) of Subsidiaries. Accrual of interest and the accretion of accreted value will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Subsidiaries Restricted Subsidiary to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, “incur” and collectively, an “incurrence”) with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and the Company shall will not issue any shares of Disqualified Stock and shall will not permit any of its Subsidiaries Restricted Subsidiary to issue any shares of Disqualified Stock or preferred stock; provided, however, that on or after the first anniversary following the Issue Date, the Company may incur Indebtedness (including Acquired DebtIndebtedness) or issue shares of Disqualified Stock, and the Company's Subsidiaries any Guarantor (other than Xxxxx Indiana) may incur Indebtedness or (including Acquired Indebtedness), issue shares of Disqualified Stock and issue shares of preferred stock, if (i) no Default or Event of Default shall have occurred and be continuing at the Fixed Charge Coverage time of, or would occur after giving effect to such incurrence of Indebtedness or issuance of shares of Disqualified Stock or preferred stock, and (ii) the Total Leverage Ratio for the Company's ’s and the Restricted Subsidiaries’ most recently ended four full fiscal quarters 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 would have been at least 2.0 less than or equal to 6.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, and the application of proceeds therefrom, had occurred at the beginning of such four-quarter period. .
(b) The first paragraph foregoing limitations will not apply to the following (each of this Section 4.09 shall not prohibit the following, “Permitted Indebtedness”):
(1) (A) the incurrence of Indebtedness under Credit Facilities by the Company or any of the following items Company’s Restricted Subsidiaries and the issuance and creation of Indebtedness letters of credit and bankers’ acceptances thereunder (collectivelywith letters of credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof), "Permitted Debt"):not to exceed $350 million outstanding at any one time, minus all principal payments made in respect of any term loans or the amount by which any commitments thereunder are permanently reduced, in each case, from the proceeds of one or more Asset Sales pursuant to Section 4.12 and (B) up to $150 million of term loan borrowings solely for the purpose of financing the construction of the tower and related capital improvements at the Xxxxx Xxx Mahal Casino Resort.
(a2) the incurrence by the Company and its Restricted Subsidiaries any Guarantor of Indebtedness in aggregate principal amount not to exceed $1.25 billion represented by the Existing IndebtednessNotes (including any Guarantee thereof) represented by this Indenture;
(b3) Existing Indebtedness (other than Indebtedness described in the immediately preceding clauses (1) and (2) and clause (4) below);
(4) Indebtedness (including Capitalized Lease Obligations) and Disqualified Stock incurred by the Company or Indebtedness (including Capitalized Lease Obligations) incurred by any of the Restricted Subsidiaries, to finance the purchase, lease, construction or improvement of property (real or personal) or equipment that is used or useful in a Permitted Business, whether through the direct purchase of assets or the Capital Stock of any Person owning such assets, in an aggregate principal amount which, when aggregated with the principal amount of all other Indebtedness and Disqualified Stock then outstanding and incurred pursuant to this clause (4) (including any Refinancing Indebtedness permitted to be incurred pursuant to clause (12) and incurred to extend, refund, refinance, defease, renew or replace Indebtedness or Disqualified Stock incurred pursuant to this clause (4) or subsequent Refinancing Indebtedness attributable to Indebtedness or Disqualified Stock incurred pursuant to this clause (4)) does not exceed at any time in the aggregate outstanding $20.0 million per Casino Property;
(5) to the extent such incurrence does not result in the incurrence by the Company and or any Restricted Subsidiary of any obligation for the Guarantors payment of borrowed money of others, Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries owed to any Person in connection with workers’ compensation, self-insurance, health, disability or other employee benefits or property, casualty or liability insurance provided by such Person to the Company or such Restricted Subsidiary, pursuant to reimbursement or indemnification obligations to such person, in each case incurred in the ordinary course of business;
(6) Indebtedness represented by Capital Lease Obligationsarising from agreements of the Company or a Restricted Subsidiary providing for indemnification, mortgage financings adjustment of purchase price or purchase money similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiariesacquisition; provided, however, that:
(i) such Indebtedness is not reflected on the balance sheet of the Company or any Restricted Subsidiary (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on such balance sheet for purposes of this clause (6)(i)) and
(ii) the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including noncash proceeds (the Fair Market Value of such noncash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Company and the Restricted Subsidiaries in connection with such disposition;
(7) Indebtedness (including Indebtedness related to Sale and Lease-Back Transactions) of the Company to a Restricted Subsidiary or of a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that:
(i) if the Company or any Guarantor is the obligor on borrower of such IndebtednessIndebtedness and the lender is a Restricted Subsidiary that is not a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the NotesNote Obligations, in the case of the Company, or its Note the Guarantee, in the case of a Guarantor; and
(1ii) any subsequent issuance or transfer of Equity Interests that any Capital Stock or any other event which results in any such Indebtedness being held by a Person other than the Company or Restricted Subsidiary ceasing to be a Restricted Subsidiary of the Company and (2) or any sale or other subsequent transfer of any such Indebtedness (except to a Person that is not either the Company or a another Restricted Subsidiary of the Company Subsidiary) shall be deemed, in each case, case to constitute be an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) shares of Disqualified Stock or preferred stock of a Restricted Subsidiary issued to the Company or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of Disqualified Stock or preferred stock (except to the Company or another Restricted Subsidiary) the incurrence shall be deemed in each case to be an issuance of such shares of Disqualified Stock or preferred stock;
(9) (i) any guarantee by the Company or a Guarantor of Indebtedness or other obligations of any Restricted Subsidiary so long as the incurrence of its such Indebtedness incurred by such Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that Subsidiary is permitted by under the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in ControlIndenture, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Trump Entertainment Resorts Holdings Lp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or issue preferred stock, if if:
(1) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. ; and
(2) the Weighted Average Life to Maturity of the Indebtedness is greater than the remaining Weighted Average Life to Maturity of the Notes.
(b) The first paragraph provisions of this Section 4.09 4.09(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence by the Company and any Restricted Subsidiaries of additional revolving credit Indebtedness and letters of credit under a Revolving Credit Facility in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Subsidiaries thereunder) not to exceed $30.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries of to repay Indebtedness under the Existing IndebtednessRevolving Credit Facility and effect a corresponding commitment reduction thereunder pursuant to Section 4.10 hereof; provided that with respect to any Revolving Credit Facility secured by a Lien or the Collateral, the lenders under such Revolving Credit Facility have entered into an Intercreditor Agreement;
(b2) the incurrence by the Company and the Guarantors of (a) Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of Exchange Notes and the Junior Note Indenture, respectively, or related Subsidiary Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement and (b) their respective obligations arising under the Collateral Documents to the extent such obligations would represent Indebtedness;
(c3) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c3), not to exceed $2.5 7.5 million at any time outstanding;
(d4) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness outstanding under the FF&E Agreements on the date of this Indenture, until such amounts are repaid;
(5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) hereof or clauses (2), (3), (5), or (13) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company Company; shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e6);
(f7) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) 8) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h9) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i10) Indebtedness reimbursement obligations with respect to letters of credit issued in the Company ordinary course of business, indemnifications, adjustments of purchase prices, performance bonds, appeal bonds, surety bonds, workers' compensation obligations or insurance obligations incurred in the ordinary course of business;
(11) indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds in the ordinary course of business;
(12) a bond or surety obligation posted in order to prevent the loss or material impairment of a Gaming License or as otherwise required by an order of any Restricted Subsidiary Gaming Authority, in each case to the extent that the Net Proceeds thereof are promptly:required by applicable law and consistent in character and amount with customary industry practice; and
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j13) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j13), not to exceed $5.0 10.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a1) through (k13) of Section 4.09(b) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09(a) above, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under Revolving Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(1) hereof.
Appears in 1 contract
Samples: Indenture (Riviera Holdings Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or and issue Disqualified Stock, Stock and the Company's Subsidiaries any Restricted Subsidiary may incur Indebtedness or issue preferred stockAcquired Debt, if either:
(i) the Fixed Charge Coverage Consolidated Leverage Ratio for at the end of the Company's most recently ended four full fiscal quarters quarter (the "Reference Period") for which internal financial statements are a consolidated balance sheet of the Company is available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 less than 5.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of the Reference Period; or
(ii) the Consolidated Capital Ratio at the end of the Reference Period would have been less than 2.0 to 1.0, determined after giving effect to the incurrence or issuance of such four-quarter periodIndebtedness or Disqualified Stock and, to the extent set forth in the definitions used herein, on a pro forma basis (including, to the extent set forth in the definitions used herein, a pro forma application of the net proceeds therefrom). The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under Credit Facilities or Permitted Vendor Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding under all Credit Facilities or Permitted Vendor Facilities after giving effect to such incurrence (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Existing IndebtednessCompany thereunder) does not exceed an amount equal to U.S. $725.0 million less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the Issue Date to permanently repay Indebtedness under a Credit Facility pursuant to Section 4.10 hereof;
(b) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness;
(c) the Guarantors incurrence by the Company of Indebtedness represented by the Notes, the Junior Dollar Notes, the Exchange Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyDollar Exchange Notes;
(cd) the incurrence by the Company or any of its Restricted Subsidiaries of Purchase Money Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for and Vendor Financing Indebtedness provided (A) that the purpose of financing all or any part amount thereof does not exceed 100% of the purchase price or Company's and its Restricted Subsidiaries' aggregate cost (determined in accordance with GAAP in good faith by the Board of construction or Directors) of the construction, acquisition, development, engineering, installation and improvement of property, plant or equipment used the applicable Telecommunications Assets and (B) in the business case of the Company incurrence of either Purchase Money Indebtedness or such Vendor Financing Indebtedness by a Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing such Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingshall be Qualified Subsidiary Indebtedness;
(de) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d), (l), (n), (o) or (jp) of this paragraph;
(ef) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted SubsidiariesSubsidiaries and the issuance of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary of the Company; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness or preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof; shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (ef);
(fg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest or foreign currency exchange rate risk with respect to any floating rate Indebtedness or foreign currency based Indebtedness, respectively, that is permitted by the terms of this Indenture to be outstanding; provided that the notional amount of any such Hedging Obligation does not exceed the amount of Indebtedness or other liability to which such Hedging Obligation relates; and provided further that such Hedging Obligations are not incurred for speculative purposes;
(gh) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a any Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09covenant;
(hi) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09Stock; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (360networks Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) For so long as any Senior Loan Obligations or any Permitted Refinancing Indebtedness thereof remains outstanding or any commitment to provide any Senior Loans shall exist, the Company shall, and shall cause its Restricted Subsidiaries to, comply with the covenants governing the incurrence of Indebtedness (including Acquired Debt) and the issuance of Disqualified Stock or the issuance by Restricted Subsidiaries of any shares of preferred stock contained in the Senior Loan Documents (as the same may be amended, restated, supplemented, replaced, refinanced or modified from time to time or waived or consented to in writing) or any corresponding provisions contained in the credit agreement or facility governing the Permitted Refinancing Indebtedness (as applicable).
(b) From and after the date of a Covenant Trigger Event:
(1) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness .
(including Acquired Debt2) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application The provisions of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall 4.09(b)(1) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(aA) the incurrence by the Company and any Guarantor of the Senior Loan Obligations and any Permitted Refinancing Indebtedness thereof;
(B) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(cC) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (cC), not to exceed $2.5 15 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(eD) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
(ii) (1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (eD);
(fE) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(i) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(ii) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (E);
(F) the incurrence by the Company or any of its Restricted Subsidiaries Guarantors of Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(gG) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.094.09(b)(2); provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jH) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of additional Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance and surety bonds in the ordinary course of business;
(including Acquired DebtI) the incurrence by the Company or any of the Guarantors of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(J) Subordinated Indebtedness or preferred stock in an aggregate principal amount (or accreted value, as applicable) at any time outstandingamount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (jJ), not to exceed $5.0 million25 million at any time outstanding;
(K) Indebtedness of the Company or a Restricted Subsidiary thereof to current or former officers, directors and employees thereof, their respective estates, spouses or former spouses, in each case to finance the purchase or redemption of Equity Interests of the Company in compliance with Section 4.07(b)(2)(E) hereof;
(L) Indebtedness of the Company or a Restricted Subsidiary thereof which after giving pro forma effect to the incurrence thereof and the application of net proceeds therefrom would permit the incurrence of at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in clause (2) of the definition of the term “Permitted Refinancing Indebtedness”; and
(kM) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence Company and the Guarantors of Indebtedness represented by a Restricted Subsidiary of the Company that was not permitted by this clause Notes (k). including PIK Notes) and any related Guarantee.
(c) The Company shall will not incur incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debtother than with respect to the exercise by the Holders of the option to purchase the Second Lien Obligations as set forth in Section 17 of the Intercreditor Agreement) that is contractually subordinated pari passu in right of payment to any other Indebtedness of with the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredNotes. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (aA) through (kM) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Indebtedness under Credit Facilities outstanding on the date on which the Notes are first Issued and authenticated under this Indenture will initially be deemed to have been incurred on such date in reliance on the exception provided by clause (A) of the definition of Permitted Debt. The accrual of interest or preferred stock dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles and the payment of dividends on preferred stock or Disqualified Stock in the form of additional shares of the same class of preferred stock or Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of preferred stock or Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(A) the Fair Market Value of such assets at the date of determination; and
(B) the amount of the Indebtedness of the other Person.
Appears in 1 contract
Samples: Indenture (WHX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their respective Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company Issuers shall not issue any Disqualified Stock and shall not permit any of its their respective Subsidiaries to issue any shares of preferred stock; providedPROVIDED, howeverHOWEVER, that the Company may incur Indebtedness (including Acquired Debt) Issuers or issue Disqualified Stock, and the Company's Subsidiaries any Guarantor may incur Indebtedness or issue shares of preferred stock, stock if the Fixed Charge Coverage Ratio of Consoltex Group for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period: PROVIDED FURTHER that no guarantee may be incurred pursuant to the provisions of this paragraph, unless the guaranteed Indebtedness is also incurred pursuant to this paragraph. The first paragraph of this Section 4.09 foregoing limitations shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
apply to (a) the incurrence by either Issuer or any Guarantor of Indebtedness pursuant to the Company and its Restricted Subsidiaries of Credit Agreement or otherwise in an aggregate principal amount not to exceed the Existing Indebtedness;
Borrowing Base, (b) Indebtedness, not covered by any other clause of this paragraph, outstanding on the date of this Indenture, (c) Indebtedness arising out of letters of credit, performance bonds, surety bonds and bankers' acceptances incurred in the ordinary course of business; PROVIDED that if any unpaid reimbursement obligation under any such instrument is outstanding for more than 10 consecutive business days, such obligation shall not be permitted to be incurred under this clause (c), (d) Indebtedness consisting of guarantees (other than guarantees relating to money borrowed), indemnities or obligations in respect of purchase price adjustments, in each case, in connection with the acquisition of assets permitted under this Indenture, (e) additional Indebtedness of up to $10 million in aggregate principal amount at any one time outstanding, (f) the incurrence by the Company Issuers and the Guarantors of Indebtedness represented by the Notes, (g) Indebtedness of a Foreign Subsidiary existing at the Junior Notes time it is acquired (1) that is not incurred in contemplation of the acquisition of such Foreign Subsidiary and (2) that is non-recourse to the related Issuers and their respective Subsidiaries except to the assets of such Foreign Subsidiary Guarantees to be issued on the date (for purposes of this Indenture and clause (g), Indebtedness of a Foreign Subsidiary existing at the date of the Junior Note Indenture, respectively, or time it is acquired includes Indebtedness incurred pursuant to Section 4.21 credit facilities in existence upon the acquisition of such Foreign Subsidiary; PROVIDED that such Indebtedness meets the requirements of clauses (1) and (2) of this Indenture or Section 4.21 of the Junior Note Indentureclause (g)), respectively;
(ch) the incurrence by the Company or any of its Restricted Issuers and their respective Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness issued in exchange for, or the net proceeds of which are used to refundextend, refinance refinance, renew, replace or replace refund Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture referred to be incurred under the first paragraph of this Section 4.09 or in clauses (a), (b), (cf) and (g) above (the "Refinancing Indebtedness"); PROVIDED, HOWEVER, that (1) the principal amount of such Refinancing Indebtedness shall not exceed the principal amount of Indebtedness so extended, refinanced, renewed, replaced, substituted, or refunded (plus the amount of reasonable expenses incurred in connection therewith); (2) the Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being extended, refinanced, renewed, replaced or refunded; and (3) the Refinancing Indebtedness shall be pari passu with or subordinate in right of payment to the Indebtedness being extended, refinanced, renewed, replaced or refunded, (di) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and either Issuer and/or any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company their respective Subsidiaries or any of its Restricted Subsidiaries of them, (j) Hedging Obligations that are incurred for the purpose of fixing or hedging currency risks, or interest rate risk rates with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in foregoing clauses (a) through (kj) above, are independent exceptions to the covenant set forth in the preceding paragraph and are additive in nature. Limitations set forth in any one of such clauses (a) through (j) or is entitled in the definitions used therein shall not be applicable to any other such clauses or any other such definitions. The Indebtedness permitted to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall foregoing clauses (a) through (j) may be permitted incurred pursuant to classify such item of Indebtedness on the date of its incurrence, one agreement or later reclassify all several agreements with one lender or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09several lenders.
Appears in 1 contract
Samples: Indenture (Consoltex Inc/ Ca)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt)Indebtedness, and the Company shall Borrower will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness .
(including Acquired Debtb) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application The provisions of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall 6.03(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(ai) Indebtedness (and Guarantees thereof) existing on the Petition Date (other than Indebtedness of foreign Subsidiaries of the Borrower);
(ii) Indebtedness created hereunder and under the other Loan Documents;
(iii) The incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of Indebtedness represented by Capital Capitalized Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business of the Company Borrower or such Restricted Subsidiaryany of its Subsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (ciii), not to exceed $2.5 million 5,000,000 at any time outstanding;
(div) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of Bank Product Obligations in the ordinary course of business and of Hedging Obligations entered into prior to the Petition Date in order to manage existing or anticipated interest rate, exchange rate or commodity price risks and not for speculative purposes;
(v) the incurrence by the Borrower or any of its Subsidiaries of Indebtedness owing under documentary or standby letters of credit for the purchase of goods or other merchandise generally;
(vi) The incurrence by the Borrower or any of its Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance and surety bonds in the ordinary course of business;
(vii) The incurrence by the Borrower or any of its Subsidiaries of Indebtedness owing under overdraft facilities in connection with cash management arrangements in the ordinary course of business;
(viii) the incurrence by (x) foreign Subsidiaries of the Borrower of Indebtedness in an aggregate amount (or accreted value, as applicable) at any time outstanding not to exceed $875,000,000 and (y) the Borrower or any of its Subsidiaries of Indebtedness in an aggregate amount (or accreted value, as applicable) at any time outstanding not to exceed $5,000,000;
(ix) Guarantees by the Borrower or any Subsidiary which are incurred in the ordinary course of business for the purpose of carrying unsold tobacco inventories held against Confirmed Orders and other Guarantees by the Borrower or any Subsidiary incurred in the ordinary course of business with respect to Uncommitted Inventories in an aggregate amount not to exceed the amount of such Uncommitted Inventories;
(x) To the extent constituting Indebtedness, financings permitted under Section 6.04(l);
(xi) the incurrence by the Borrower or any of its Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture Agreement to be incurred under the first paragraph clauses (iii), (viii) or (xi) of this Section 4.09 or clauses (a6.03(b), (b), (c), (d) or (j) of this paragraph;
(exii) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Borrower and any of its Restricted SubsidiariesSubsidiaries in the ordinary course of business consistent with past practice; provided, however, that:
(i) if the Company or that any Guarantor is the obligor on such Indebtedness, such Indebtedness must to the extent owed by the Borrower or any Subsidiary Guarantor, shall be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect and an intercompany note evidencing such indebtedness owed to a Loan Party shall delivered to the Notes, in the case of the Company, or its Note Guarantee, in the case of a GuarantorCollateral Agent pursuant to Section 5.13 and 5.19; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gxiii) the Guarantee by the Company Borrower or any of the Guarantors its Subsidiaries of Indebtedness of the Company Borrower or a Restricted Subsidiary of the Company Borrower to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.09;
(h) 6.03; provided that if the accrual of interest, the accretion Indebtedness being guaranteed is subordinated to or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness pari passu with the same termsCredit Facility, and then the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not Guarantee must be deemed to be an incurrence of Indebtedness subordinated or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valuepari passu, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no same extent as the Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredguaranteed. For purposes of determining compliance with this Section 4.096.03, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxiii) above, or is entitled to be incurred pursuant to above the first paragraph of this Section 4.09, the Company shall Borrower will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.096.03. The Borrower will not incur, and will not permit any Subsidiary Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Borrower or such Subsidiary Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Credit Facility and the Guarantees thereof on substantially identical terms; provided, however, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Borrower solely by virtue of being unsecured or by virtue of being secured on junior priority basis. The accrual of interest or preferred stock dividends and the accretion or amortization of original issue discount will not be deemed to be an incurrence of Indebtedness or an issuance of preferred stock or Disqualified Stock for purposes of this covenant. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred. Notwithstanding any other provision of this Section 6.03, the maximum amount of Indebtedness that the Borrower or any Subsidiary may incur pursuant to this Section 6.03 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(i) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(ii) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(iii) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(A) the Fair Market Value of such assets at the date of determination; and
(B) the amount of the Indebtedness of the other Person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Issuers shall not issue any Disqualified Stock and shall not permit any of its their Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company Issuers and its Restricted their Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors Issuers of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySenior Notes;
(c) with respect to lease or rental commitments to lessees (i) existing as of the date hereof or (ii) permitted to be incurred by Foreign Subsidiaries after the date hereof in accordance with Section 4.12, the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, obligations incurred for the purpose of financing all or any part of the purchase price or cost of construction equipment leased or improvement sold to, or otherwise financed for, a customer of property, plant or equipment used in the business of the Company Issuers or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 10.0 million at any time outstanding;
(d) the incurrence by (i) the Company Issuers or any of its Restricted their Subsidiaries or (ii) with respect to clause (b) of this Section 4.09, the Issuers, of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d), (g), (i) or (jk) of this paragraph;
(e) the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of intercompany Indebtedness between or among the Company Issuers and any of its Restricted their Subsidiaries; provided, however, that:
(i) if either the Company or any Guarantor NLC is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Issuers or a Restricted Subsidiary of the Company Issuers and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Company, NLC or a Restricted Subsidiary of the Company Issuers shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Issuers or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingoutstanding or for the purpose of fixing or hedging currency risk;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(ih) Indebtedness of the Company Issuers or any Restricted Subsidiary to the extent that the Net Proceeds net proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, ; or
(ii) deposited used to defease the redeem Notes pursuant to Article 8 Section 3.08 hereof.
(ji) the incurrence by the Company Issuers or any of its Restricted their Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ji), not to exceed $5.0 million; and;
(kj) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, ; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted SubsidiaryDebt, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company Issuers that was not permitted by this clause (j); and
(k). The Company shall not incur ) obligations in respect of letters of credit, performance and surety bonds and completion guarantees provided by the Issuers or any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness Subsidiary of the Company unless such Indebtedness is also contractually subordinated Issuers in right the ordinary course of payment business; including pursuant to the Notes on substantially identical terms; provided, however, that no Indebtedness Letter of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecuredCredit Facility. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Comdisco Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Restricted Subsidiaries may incur Indebtedness or issue Disqualified Stock or preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company of term Indebtedness under Credit Facilities (and the Guarantee thereof by the Senior Subordinated Note Guarantors); provided that the aggregate principal amount of all term Indebtedness outstanding under this clause (i) after giving effect to such incurrence does not exceed an amount equal to $920.0 million;
(ii) the incurrence by the Company of revolving credit Indebtedness and letters of credit (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) under Credit Facilities (and the Guarantee thereof by the Senior Subordinated Note Guarantors); provided that the aggregate principal amount of all revolving credit Indebtedness outstanding under this clause (ii) after giving effect to such incurrence does not exceed an amount equal to $480.0 million;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company Company, the Senior Subordinated Note Guarantors and the Senior Note Guarantors of Indebtedness represented by the Senior Notes, the Junior Notes Senior Subordinated Notes, the Senior Subsidiary Guarantees and the related Subordinated Subsidiary Guarantees limited in aggregate principal amount, without duplication, to be issued on amounts outstanding under the date of this Senior Note Indenture and the date this Senior Subordinated Note Indenture as of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelytheir respective dates;
(cv) (A) the guarantee by the Company or any of the Senior Subordinated Note Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company or (B) the incurrence of Indebtedness of a Restricted Subsidiary to the extent that such Indebtedness is supported by a letter of credit, in each case that was permitted to be incurred by another provision of this covenant;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by (including Capital Lease Obligations) to finance the acquisition (including by direct purchase, mortgage financings by lease or purchase money obligations, in each case, incurred for indirectly by the purpose of financing all or any part acquisition of the purchase price or cost Capital Stock of construction a Person that becomes a Restricted Subsidiary as a result of such acquisition) or improvement of property, plant property (real or equipment used in the business of the Company or such Restricted Subsidiary, personal) in an aggregate principal amountamount which, when aggregated with the principal amount of all other Indebtedness then outstanding pursuant to this clause (vi) and including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (cvi), does not exceed an amount equal to exceed $2.5 million 5% of Total Assets at any the time outstandingof such incurrence;
(dvii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Senior Subordinated Note Indenture to be incurred under the first paragraph of this Section 4.09 hereof or clauses (aiii), (b), (c), (div) or (jvii) of this paragraph;
(eviii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Senior Subordinated Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (eviii);
(fix) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by management and not for the terms purpose of this Indenture to be outstandingspeculation;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(kx) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (kx). The Company shall , and the issuance of preferred stock by Unrestricted Subsidiaries;
(xi) the incurrence of Indebtedness solely in respect of performance, surety and similar bonds or completion or performance guarantees (including, without limitation, performance guarantees pursuant to coal supply agreements or equipment leases), to the extent that such incurrence does not incur result in the incurrence of any obligation for the payment of borrowed money to others;
(xii) the incurrence of Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness arising from agreements of the Company unless or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary; provided, however that (i) such Indebtedness is also contractually subordinated in right of payment to not reflected on the Notes on substantially identical terms; provided, however, that no Indebtedness balance sheet of the Company shall or any Restricted Subsidiary (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet will not be deemed to be contractually subordinated reflected on such balance sheet for purposes of this clause (i)) and (ii) the maximum assumable liability in right respect of payment all such Indebtedness shall at no time exceed the gross proceeds including noncash proceeds (the fair market value of such noncash proceeds being measured at the time received and without giving effect to any other Indebtedness subsequent changes in value) actually received by the Company and its Restricted Subsidiaries in connection with such disposition;
(xiii) the guarantee by the Company or any of the Senior Subordinated Note Guarantors of additional Indebtedness relating to Black Beauty Coal Company solely not to exceed $50.0 million in aggregate principal amount outstanding at any one time under this clause (xiii);
(xiv) the incurrence of Indebtedness relating to the Bengalla Joint Venture or the Warkworth Associates Joint Venture in an aggregate amount not to exceed $100.0 million in aggregate principal amount outstanding at any one time under this clause (xiv); and
(xv) the incurrence by virtue the Company or any of being unsecuredits Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xv), not to exceed $250.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxv) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify or reclassify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. Accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
Appears in 1 contract
Samples: Senior Subordinated Note Indenture (P&l Coal Holdings Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Restricted Subsidiaries may incur Indebtedness or issue preferred stockIndebtedness, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any one time outstanding under this clause (a), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (a), not to exceed $12.5 million at any one time outstanding;
(b) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bc) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Note Guarantees to be issued on the date of this Indenture hereof and the date of exchange Notes and the Junior Note Indenture, respectively, or related Guarantees to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(cd) the incurrence by the Company or any of its Restricted Subsidiaries of FF&E Financing or Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of any Casino owned and either operated or to be operated by the Company or such Restricted Subsidiary, in an aggregate principal amount, amount (including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (cd), ) with respect to any such Casino not to exceed $2.5 7.0 million in aggregate principal amount for each Casino owned or operated by the Company at any time outstanding;
(de) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (je) of this paragraph;
(ef) the issuance by any Restricted Subsidiary of preferred stock to the Company or the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; Subsidiaries as provided in Section 4.21 hereof, provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations that with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
any such intercompany Indebtedness: (1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (ef);
(fg) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that was incurred pursuant to this Section 4.09 or is otherwise permitted by the terms of this Indenture to be outstandingoutstanding pursuant to this Indenture;
(gh) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted otherwise incurred pursuant to be incurred by another provision of this Section 4.09;
(hi) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09covenant; provided, however, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (respect of performance, surety or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionappeal bonds provided in the ordinary course of business; and
(k) the incurrence by assumption of the Company's Unrestricted Subsidiaries of Non-Recourse Debtobligations under the Xxxxx Casino Corporation Notes in connection with the Xxxxx Casino Corporation Acquisition, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt is retired or repaid within five Business Days following the assumption of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k)Indebtedness. The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09section, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (HWCC Shreveport Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Issuers shall not, and shall not permit any of its their respective Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and that the Issuers and the Company Subsidiary Guarantors shall not issue any Disqualified Stock and the Issuers shall not permit any of its their respective Subsidiaries which are not Subsidiary Guarantors to issue any shares of preferred stock; provided, however, that the Company Issuers and their Subsidiaries may incur Indebtedness (including Acquired DebtDebt and Indebtedness under the New Credit Facility) or issue shares of Disqualified StockStock or in the case of Subsidiaries which are not Subsidiary Guarantors, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if stock if: the Fixed Charge Coverage Ratio for the CompanyFoamex's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issuedissued and such net proceeds had been applied, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall covenant will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by the Company Issuers or any of their respective Subsidiaries of term Indebtedness under the New Credit Facility; provided that the aggregate principal amount of all term Indebtedness outstanding under the New Credit Facility after giving effect to such incurrence, including all term Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (i), does not exceed an amount equal to $330.0 million less the aggregate amount of all Net Proceeds of Asset Sales that have been applied since the date of this Indenture to repay such term Indebtedness under the New Credit Facility and its Restricted resulting in a permanent reduction of the related commitments pursuant to Section 4.10;
(ii) the incurrence by the Issuers or any of their respective Subsidiaries of revolving credit Indebtedness and letters of credit (with letters of credit being deemed to have a principal amount, without duplication, equal to the maximum potential liability of the Issuers and their Subsidiaries thereunder) under the New Credit Facility; provided that the aggregate principal amount of all revolving credit Indebtedness outstanding under the New Credit Facility after giving effect to such incurrence, including all revolving Indebtedness incurred to refund, refinance or replace any other revolving Indebtedness incurred pursuant to this clause (ii), does not exceed an amount equal to $150.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied to repay such revolving Indebtedness and resulting in a permanent reduction of the related commitments pursuant to Section 4.10; provided, however, that notwithstanding anything to the contrary contained in this Indenture, in no event shall the amount of Indebtedness which the Issuers and their Subsidiaries may incur in the aggregate pursuant to clause (i) and this clause (ii) be less than $150.0 million;
(iii) the incurrence by the Issuers and their respective Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company Issuers and the Subsidiary Guarantors of Indebtedness represented by the Senior Subordinated Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(cv) the incurrence by the Company Issuers or any of its Restricted their respective Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company Issuers or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 25.0 million at any time outstanding;
(dvi) the incurrence by the Company Issuers or any of its Restricted their respective Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evii) the incurrence by the Company Issuers or any of its their respective Restricted Subsidiaries of intercompany Indebtedness between or among the Company Issuers and any of its their respective Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor an Issuer is the obligor on such IndebtednessIndebtedness and the payee is not a Subsidiary Guarantor, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Senior Subordinated Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company an Issuer or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company an Issuer or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company an Issuer or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(fviii) the incurrence by the Company Issuers or any of its Restricted their respective Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingObligations;
(gix) the Guarantee by the Company Issuers or any of the Guarantors their respective Subsidiaries of Indebtedness of the Company Issuers or a Restricted Subsidiary of the Company Issuers that was permitted to be incurred by another provision of this Section 4.09covenant;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jx) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Issuers' Unrestricted Subsidiaries of Non-Recourse DebtDebt and preferred stock, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted Issuers;
(xi) the incurrence by the Issuers or any of their respective Subsidiaries of additional Indebtedness including, without limitation, pursuant to the New Credit Facility, in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness incurred pursuant to this clause (kxi). The Company shall , not incur any Indebtedness to exceed $45.0 million;
(including Permitted Debtxii) that Acquired Debt of a Subsidiary in existence at the time of the acquisition of such Subsidiary, if such Acquired Debt was not incurred in contemplation of such acquisition and such Acquired Debt is contractually subordinated in right of payment Non-Recourse Debt (except with respect to any other such acquired Subsidiary and its Subsidiaries);
(xiii) Indebtedness of the Company unless Foamex Canada, Inc. and its Subsidiaries (which is Non-Recourse Debt, except with respect to such Indebtedness is also contractually subordinated entities) in right of payment an amount, at any time outstanding not to the Notes on substantially identical terms; provided, however, that no exceed CND$15.0 million;
(xiv) Indebtedness of Foamex Latin America (which is Non-Recourse Debt, except with respect to such entities) in an amount, at any time outstanding not to exceed $12.0 million;
(xv) Assets Sales in the Company shall be deemed to be contractually subordinated in right form of payment to any other Receivables Transactions; and
(xvi) Indebtedness of the Company solely by virtue of being unsecuredFoamex Asia Inc. and its Subsidiaries (which is Non-Recourse Debt, except with respect to such entities) in an amount, at any time outstanding not to exceed $5.0 million. For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxvi) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09covenant, the Company shall be permitted to Issuers shall, in their sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09covenant and such item of Indebtedness will be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph hereof. Neither the accrual of interest, nor the accretion of accreted value will be deemed to be an incurrence of Indebtedness for purposes of this covenant.
Appears in 1 contract
Samples: Indenture (Foamex International Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; providedPROVIDED, howeverHOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if Stock if:
(i) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and
(ii) no Default or Event of Default has occurred and is continuing. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtPERMITTED DEBT"):
(ai) The incurrence by the Company of additional Indebtedness under Credit Facilities; provided that the aggregate principal amount of all Indebtedness of the Company and its Restricted Subsidiaries outstanding, at any time, under all Credit Facilities incurred under this clause (i) after giving effect to such incurrence does not exceed an amount equal to $250.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be originally issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of the Guarantees and this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 50.0 million at any time outstanding;
(dv) the incurrence of Indebtedness solely in respect of bankers' acceptances, letters of credit, surety or performance bonds (to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money of others), all in the ordinary course of business;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (dii) or (jiii) of this paragraph;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; providedPROVIDED, howeverHOWEVER, that:
: (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests or other event that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingObligations;
(gix) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(hx) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (x), not to exceed $100.0 million outstanding at any time;
(xi) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt; PROVIDED, HOWEVER, that if any such Indebtedness ceases to be Non-Recourse Debt, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (xi); and
(xii) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09Stock; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness (including Acquired Debt) meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxii) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall Company, in its sole discretion, will be permitted to classify (or later classify or reclassify), in whole or in part, such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Key Energy Services Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently whether or otherwisenot such liability is contingent, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, provided that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries any Subsidiary Guarantor may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.5 to 1, 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) hereof shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, Disqualified Stock or preferred stock, as applicable (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries (and the Guarantee thereof by any Restricted Subsidiary or the Company, as applicable) of Indebtedness and letters of credit under any Credit Facility, such Indebtedness in an aggregate principal amount not to exceed $1,500,000,000;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, Notes or the Junior Notes and the related incurrence by any Subsidiary Guarantees to be issued on the date Guarantor of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyIndebtedness represented by a Subsidiary Guarantee;
(c4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of propertyproperty (real or personal), plant or equipment (whether through the direct purchase of assets or through the purchase of the Capital Stock of any Person owning such assets) used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed the greater of (i) $2.5 200 million at any time outstandingor (ii) 5% of the Consolidated Net Tangible Assets of the Company;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) hereof or clause (2), (3), (4), (5), (12) or (14) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of obligations with respect to letters of credit securing obligations entered into in the ordinary course of business to the extent such letters of credit are not drawn upon or, if drawn upon, such drawing is reimbursed within five Business Days following receipt of a demand for reimbursement;
(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, provided that:
(iA) if the Company or any a Subsidiary Guarantor is the obligor on such IndebtednessIndebtedness and such Indebtedness is held by a Restricted Subsidiary other than a Subsidiary Guarantor, such Indebtedness must (unless subject to a Permitted Lien referred to in clause (1) of the definition thereof or a Fall Away Permitted Lien referred to in clause (1) of the definition thereof) be expressly subordinated in right of payment to the prior payment in full in cash of all Obligations of the Company with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a Subsidiary Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of (except for the grant of a Permitted Lien or Fall Away Permitted Lien on) any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each casecase (i) and (ii), to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance of shares of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that (i) any subsequent issuance or transfer of any Capital Stock or any other event which, in either case, results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or (ii) any other subsequent transfer of any such shares of preferred stock (except to the Company or another Restricted Subsidiary) shall be deemed, in each case (i) and (ii), in each case to be an issuance of such shares of preferred stock that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of of:
(A) Hedging Obligations that are not incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gB) Indebtedness in respect of performance, surety or appeal bonds provided in the Guarantee ordinary course of business; and
(C) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price, earn-out or similar obligations of the Company or any of its Restricted Subsidiaries incurred in connection with the disposition of any business, assets or Subsidiary of the Company in an aggregate amount not to exceed the gross proceeds actually received by the Company or any of Restricted Subsidiary in connection with such disposition;
(10) the Guarantors guarantee by (a) the Company or a Subsidiary Guarantor of Indebtedness of the Company or a Restricted Subsidiary or (b) a Restricted Subsidiary of the Company that is not a Subsidiary Guarantor of Indebtedness of any other Restricted Subsidiary of the Company that is not a Subsidiary Guarantor, in each case (a) and (b), that was permitted to be incurred by another provision of this Section 4.09;
(h11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers' compensation claims, environmental remediation or other environmental matters or payment obligations in connection with self-insurance or similar requirements, in each case to the extent arising in the ordinary course of business;
(12) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Receivables Program, provided that the aggregate principal component of amounts outstanding under the Receivables Program at any one time shall not exceed the greater of (a) $500 million and (b) 75% of the aggregate amount of the total Receivables and Related Assets of the Company and its Restricted Subsidiaries existing at the time such Indebtedness is incurred;
(13) the incurrence by the Company or a Restricted Subsidiary of Indebtedness to the extent the net proceeds thereof are promptly deposited to defease all Outstanding Notes as described in Article 8 hereof;
(14) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including pursuant to a Credit Facility) or the issuance of Disqualified Stock by the Company or preferred stock by any Restricted Subsidiary in an aggregate principal amount or liquidation preference (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (14), not to exceed $250 million;
(15) the incurrence by the Company of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Indebtedness is extinguished within five Business Days of incurrence; and
(16) the incurrence by a Restricted Subsidiary of the Company of Acquired Debt; provided that the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Acquired Debt is incurred would have been at least 3 to 1 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if such Acquired Debt had been incurred at the beginning of such four-quarter period.
(c) For purposes of determining compliance with this Section 4.09:
(1) in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (16) of Section 4.09(b) hereof, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company shall be permitted to classify all or a portion of such item of Indebtedness on the date of its incurrence, or, subject to Section 4.09(c)(2) below, later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09;
(2) Indebtedness under Credit Facilities outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(1) hereof, and Indebtedness under a Receivables Program outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(12) hereof, and the Company shall not be permitted to reclassify any portion of such Indebtedness thereafter;
(3) the outstanding principal amount of any particular Indebtedness shall be counted only once and any obligations arising under any guarantee, Lien, letter of credit or similar instrument supporting such Indebtedness shall not be counted twice;
(4) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i5) the amount of Indebtedness issued at a price that is less than its principal amount will be equal to the amount of the Company or liability in respect thereof determined in accordance with GAAP; and
(6) if Obligations in respect of letters of credit are incurred pursuant to any Restricted Subsidiary Credit Facility and are being treated as incurred pursuant to clause (1) of Section 4.09(b) hereof and the letters of credit relate to other Indebtedness, such other Indebtedness will be deemed not incurred to the extent that of such Obligations. With respect to overdraft lines, the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result amount of a Change in Control, or
(ii) deposited to defease any outstanding Indebtedness shall be determined net of cash held for the Notes pursuant to Article 8 hereofbenefit of the relevant entity by the institution creating such overdraft.
(jd) After the incurrence by occurrence of a Fall Away Event, the Company or will not permit any of its Restricted Subsidiaries of additional (other than a Subsidiary Guarantor) to, directly or indirectly, incur any Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at to issue any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries shares of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including preferred stock other than Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur" or an "incurrence") any Indebtedness (including Acquired Debt), and that the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or Indebtedness, and the Company may issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Consolidated Interest Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, issued or incurred at the beginning of such four-four- quarter period. The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(a) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under the Existing Credit Facility in an aggregate principal amount at any one time outstanding not to exceed $65.0 million, plus any fees, premiums, expenses (including costs of collection), indemnities and similar amounts payable in connection with such Indebtedness, and less any amounts repaid permanently in accordance with Section 4.10;
(b) the incurrence by the Company and the Guarantors its Restricted Subsidiaries of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyExisting Indebtedness;
(c) the incurrence by the Company or any and its Restricted Subsidiaries of Hedging Obligations;
(d) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligationsthe Original Notes, mortgage financings the Subsidiary Guarantees of the Original Notes, the Series A/B Notes, the Series A/B Subsidiary Guarantees, the Series A/B Indenture, the Series C/D Notes, the Series C/D Subsidiary Guarantees, and the Series C/D Indenture;
(e) the incurrence of intercompany Indebtedness between or purchase money obligationsamong the Company and any of its Wholly Owned Restricted Subsidiaries, provided that any subsequent issuance or transfer of Equity Interests that results in each caseany such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company, incurred for the purpose of financing all or any part sale or other transfer of any such Indebtedness to a Person that is neither the Company nor a Wholly Owned Restricted Subsidiary of the purchase price or cost Company, shall be deemed to constitute an incurrence of construction or improvement of property, plant or equipment used in the business of such Indebtedness by the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstandingas the case may be;
(df) Indebtedness in respect of bid, performance or surety bonds issued for the account of the Company or any Restricted Subsidiary thereof in the ordinary course of business, including guarantees or obligations of the Company or any Restricted Subsidiary thereof with respect to letters of credit supporting such bid, performance or surety obligations (in each case other than for an obligation for money borrowed); and
(g) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refundextend, refinance refinance, renew, replace, defease or replace refund Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (other than pursuant to clause (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) ). In the accrual event that the incurrence of interestany Indebtedness would be permitted by the first paragraph set forth above or one or more of the provisions set forth in the second paragraph above, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness Company may designate (in the form of additional Indebtedness with an Officers' Certificate delivered to the same terms, and Trustee) the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes particular provision of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes Indenture pursuant to Article 8 hereofwhich it is incurring such Indebtedness.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall Authority will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), Indebtedness) and the Company shall Authority will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company Authority may incur Indebtedness (including Acquired DebtIndebtedness) or issue Disqualified Stock, Stock and the Company's Authority’s Restricted Subsidiaries may incur Indebtedness or issue preferred stock, stock if (i) the Fixed Charge Coverage Ratio for the Company's Authority’s most recently ended four full fiscal quarters for which internal consolidated financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 11.0, 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 or Disqualified Stock had been issued, as the case may beapplicable, at the beginning of such four-quarter period, and (ii) no Default or Event of Default shall have occurred and be continuing or would result from such incurrence of Indebtedness. The first paragraph Notwithstanding the foregoing, the Authority will not issue any Disqualified Stock or any type of this Capital Stock that would violate IGRA.
(b) Section 4.09 shall 4.09(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):Indebtedness:
(ai) the incurrence by the Company Authority or any of its Restricted Subsidiaries of (A) Indebtedness (including letters of credit) under Credit Facilities; provided that the aggregate principal amount of all Indebtedness under Credit Facilities outstanding under this clause (i) (including any Permitted Refinancing Indebtedness incurred pursuant to clause (B) below) as of the date of any incurrence pursuant to this clause (i), after giving effect to any such incurrence and the application of the net proceeds therefrom (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Authority and its Restricted Subsidiaries thereunder) shall not exceed the greater of (1) $1,000.0 million, minus (x) the amount of Indebtedness incurred pursuant to this clause (i) since the Issue Date that has been (a) retired with the Net Proceeds from any Asset Sale applied to permanently reduce the outstanding amounts of such Indebtedness pursuant to Section 4.10 hereof or (b) assumed by a transferee in an Asset Sale and (y) the Lease Financing Amount, if any, outstanding at such time and (2) the maximum aggregate principal amount that could be incurred without causing the Consolidated Secured Leverage Ratio of the Authority, at the time of incurrence, to exceed 3.00 to 1.00 (after giving effect to the application of the net proceeds therefrom and to any other pro forma adjustments consistent with the provisions set forth in the definition of “Fixed Charge Coverage Ratio”) and (B) Permitted Refinancing Indebtedness to Replace any Indebtedness outstanding pursuant to this clause (i);
(ii) the incurrence by the Authority or any of its Restricted Subsidiaries of the Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors Authority or any of its Restricted Subsidiaries of Indebtedness represented by the Notes, Notes (including the Junior Notes and the related Subsidiary Guarantees to be Guarantees) issued on the date of this Indenture Issue Date and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyany Exchange Notes issued in Replacement thereof;
(civ) the incurrence by the Company Authority or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of real property, plant furniture, fixtures, equipment or equipment similar assets used or useful in the business of the Company Authority or such Restricted SubsidiarySubsidiary not to exceed 100% of the lesser of cost and fair market value of the assets financed, together with any Permitted Refinancing Indebtedness in respect thereof, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to amount under this clause (c), iv) not to exceed $2.5 125.0 million at any time outstanding;
(dv) the incurrence by the Company Authority or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance refinance, renew, extend, defease or replace Replace, Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) hereof or clause (ii) or (iii) of this Section 4.09 or clauses (a), (b), (c), (d4.09(b) or this clause (j) of this paragraphv);
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company Authority or any of its Restricted Subsidiaries of Hedging and Swap Obligations that are incurred for the purpose of fixing to manage interest rates or hedging currency exchange rates or interest rate or currency exchange rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingand not for speculative purposes;
(gvii) the Guarantee guarantee by the Company Authority or any of the Guarantors its Restricted Subsidiaries of any Indebtedness of the Company Authority or a any of its Restricted Subsidiary of the Company Subsidiaries that was permitted to be incurred by another provision of this Section 4.09;
(hviii) the accrual incurrence by (1) a Restricted Subsidiary of interestIndebtedness owed to another Restricted Subsidiary or to the Authority or (2) the Authority of Indebtedness owed to a Restricted Subsidiary; provided that, the accretion or amortization of original issue discountin each case, the payment of interest on if at any time any such Restricted Subsidiary ceases to be a Restricted Subsidiary, any such Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for the purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jix) the incurrence by the Company Authority or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), outstanding not to exceed $5.0 100.0 million;
(x) to the extent that such incurrence does not result in the incurrence by the Authority or any Restricted Subsidiary of any obligation for the payment of borrowed money of others, Indebtedness incurred solely as a result of the execution by the Authority or its Restricted Subsidiaries of a Completion Guarantee and Keep-Well Agreement;
(xi) any guarantee of Indebtedness of another Person to the extent constituting a Permitted Investment incurred pursuant to clause (v) of the definition thereof; and
(kA) Capitalized Lease Obligations owing to Downs Lodging, LLC in respect of the incurrence hotel and convention center being constructed by Downs Lodging, LLC adjacent to the Company's casino facility at Pocono Downs, for so long as such entity is an Unrestricted Subsidiaries Subsidiary of Non-Recourse Debtthe Authority and (B) Indebtedness of Downs Lodging, provided, however, that if any such Indebtedness ceases LLC deemed to be Non-Recourse Debt of an Unrestricted Subsidiaryincurred upon its designation, such event shall be deemed to constitute an incurrence of Indebtedness by if any, as a Restricted Subsidiary in accordance with this Indenture, in an aggregate principal amount not to exceed $55.0 million as of the Company date of such designation; provided that was not permitted by in the case of this clause (k). The Company shall not incur any Indebtedness (including Permitted DebtB) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment was incurred to finance (or to refinance Indebtedness incurred to finance) the hotel and convention center being constructed by Downs Lodging, LLC adjacent to the Notes on substantially identical termscasino facility at Pocono Downs and fees and expenses incurred in connection therewith; provided, however, that at the time of, and after giving effect to, the incurrence of any Indebtedness pursuant to clause (ix), (x) or (xi), no Indebtedness Default or Event of the Company Default shall have occurred and be deemed to be contractually subordinated in right continuing or would occur as a consequence of payment to any other Indebtedness of the Company solely by virtue of being unsecuredsuch incurrence. For purposes of determining compliance with this Section 4.09, 4.09 in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt Indebtedness described in clauses (ai) through (kxii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09(a) hereof, the Company shall be permitted to Authority shall, in its sole discretion, classify or reclassify, or later divide, classify or reclassify, such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09; provided that if such Indebtedness is secured by a Lien, such Lien would be permitted to be incurred to secure such reclassified Indebtedness as of the date of reclassification in accordance with Section 4.12; provided, further, that Indebtedness outstanding under the Bank Credit Facility, the Second Out Facility and the Existing Second Lien Notes on the Issue Date, and any Replacement of such Indebtedness that is secured by a Lien, shall be deemed to be outstanding pursuant to clause (i) above. The payment of dividends on Preferred Stock in the form of additional shares of Preferred Stock of the same class, accretion of original issue discount or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of fluctuations in the exchange rate of currencies shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, "INCUR"), with respect to (collectively, "incur") any Indebtedness (including Acquired DebtIndebtedness), and ;
(b) the Company shall not issue any Disqualified Stock not, and shall not permit any of its Restricted Subsidiaries to, issue any shares of Disqualified Stock; and
(c) the Company shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, PROVIDED that the Company or any Restricted Subsidiary may incur Indebtedness (Indebtedness, including Acquired Debt) Indebtedness, or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, Stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such that additional Indebtedness is incurred or such that Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a consolidated pro forma basis (including basis, including, but not limited to, a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such that four-quarter period. The provisions of the first paragraph of this Section 4.09 shall will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtPERMITTED INDEBTEDNESS"):
(ai) the incurrence by the Company and its Restricted Subsidiaries of Indebtedness under the Existing IndebtednessNew Credit Facilities and the Foreign Credit Facilities; PROVIDED that the aggregate principal amount of all Indebtedness (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and those Restricted Subsidiaries thereunder) then classified as having been incurred in reliance upon this clause (i) that remains outstanding under the New Credit Facilities and the Foreign Credit Facilities after giving effect to that incurrence does not exceed an amount equal to $760.0 million less any amounts borrowed under clause (xii) below and an amount not to exceed $25.0 million of additional foreign borrowings;
(bii) the incurrence by the Company and its Restricted Subsidiaries of Existing Indebtedness;
(iii) the Guarantors incurrence by the Company of Indebtedness represented by the Notes, the Junior Notes initially issued in this offering and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of Note Guarantees by the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyCompany's Restricted Subsidiaries;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Purchase Money Indebtedness, Capital Expenditure Indebtedness, Capital Lease Obligations, mortgage financings including acquisitions of Capital Stock of a Person that becomes a Restricted Subsidiary to the extent of the fair market value of the property, plant or equipment so acquired (and refinancings thereof), in an aggregate principal amount (or accreted value, as 57 applicable) not to exceed the greater of (a) $30.0 million outstanding after giving effect to that incurrence or (b) 10.0% of Consolidated Net Tangible Assets at the time of incurrence;
(v) Indebtedness arising from agreements of the Company or any Restricted Subsidiary providing for indemnification, adjustment of purchase money price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing all or any part of that acquisition; PROVIDED that (A) that Indebtedness is not reflected on the purchase price or cost of construction or improvement of property, plant or equipment used in the business balance sheet of the Company or such any Restricted Subsidiary, Subsidiary (contingent obligations referred to in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred a footnote or footnotes to refund, refinance or replace any Indebtedness incurred pursuant financial statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on that balance sheet for purposes of this clause (cA), not ) and (B) the maximum assumable liability in respect of that Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of those non-cash proceeds being measured at the time received and without giving effect to exceed $2.5 million at any time outstandingsubsequent changes in value) actually received by the Company and/or that Restricted Subsidiary in connection with that disposition;
(dvi) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness or Disqualified Stock or preferred stock of a Restricted Subsidiary between or among the Company and and/or any of its Restricted Subsidiaries; provided, however, that:
PROVIDED that (i) if the Company or any Guarantor is the obligor on such that Indebtedness, such that Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or Disqualified Stock being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness or Disqualified Stock to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness or Disqualified Stock by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations Agreements; PROVIDED that such Hedging Agreements are incurred entered into in the ordinary course of business, not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculation;
(gix) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(hx) the accrual obligations in respect of interest, the accretion or amortization performance and surety bonds and completion guarantees (including related letters of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(icredit) Indebtedness of provided by the Company or any Restricted Subsidiary to in the extent that the Net Proceeds thereof are promptly:ordinary course of business;
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jxi) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) or Disqualified Stock or preferred stock of a Restricted Subsidiary in an aggregate face amount or principal amount (or accreted value, as applicable) at any time outstandingoutstanding after giving effect to that incurrence, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jxi), not to exceed $5.0 40.0 million.
(xii) Indebtedness of Foreign Subsidiaries (which may be incurred under the New Credit Facilities or otherwise) (A) in an aggregate principal amount at any one time outstanding not to exceed the sum of (a) 85% of the net book value of the accounts receivable of such Foreign Subsidiaries in accordance with GAAP and (b) 50% of the net book value of the inventory of such Foreign Subsidiaries in accordance with GAAP (provided that the calculation under this clause (A) shall exclude the net book value of accounts receivable and inventory sold to or financed through any Accounts Receivable Subsidiary) or (B) representing guarantees of Indebtedness of another Foreign Subsidiary incurred pursuant to subclause (A) of this clause (xii);
(xiii) unsecured Indebtedness incurred by the Company to former employees in connection with the purchase or redemption of Equity Interests of the Company not to exceed in the aggregate $10.0 million; and
(kxiv) the incurrence by the Company's Unrestricted Subsidiaries Indebtedness of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of incurred and outstanding on the date such Restricted Subsidiary was acquired by the Company that was not permitted by in a principal amount that, when taken together with the principal amount of all other Indebtedness incurred pursuant to this clause (kxiv). The Company shall , does not incur any exceed $40.0 million; PROVIDED that such Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment was incurred by such Subsidiary prior to any other Indebtedness of such acquisition by the Company unless or one of its Subsidiaries and was not incurred in connection with, or contemplation of, such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of acquisition by the Company shall be deemed to be contractually subordinated in right or one of payment to any other Indebtedness of the Company solely by virtue of being unsecuredits Subsidiaries. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness or Disqualified Stock or preferred stock of Subsidiaries meets the criteria of more than one of the categories of Permitted Debt Indebtedness described in clauses (ai) through (kxiv) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness or Disqualified Stock or preferred stock of Subsidiaries will be treated as having been incurred pursuant to only one of those clauses or pursuant to the first paragraph hereof of this Section 4.09. In addition, the Company may, at any time, change the classification of an item of Indebtedness or Disqualified Stock or preferred stock of Subsidiaries (or any portion thereof) to any other clause or to the first paragraph hereof; PROVIDED that the Company would be permitted to incur such item of Indebtedness or Disqualified Stock or preferred stock of Subsidiaries (or such portion thereof) pursuant to such other clause or the first paragraph hereof of this Section 4.09, as the case may be, at the time of reclassification. Accrual of interest and dividends, accretion or amortization of original issue discount and changes to amounts outstanding under Hedging Agreements solely as a result of fluctuations in foreign currency exchange rates or interest rates or by reason of fees, indemnities and compensation payable thereunder, will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09. All Indebtedness under the New Credit Facilities and the Foreign Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been incurred on such date in reliance on the first paragraph of this Section 4.09.
Appears in 1 contract
Samples: Indenture (Noveon Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company Borrower shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company Borrower shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Borrower may incur Indebtedness or issue shares of Disqualified Stock and any of its Restricted Subsidiaries may issue shares of preferred stockstock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, if the Fixed Charge Coverage Ratio sum of (x) Indebtedness of the Borrower and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stock of Restricted Subsidiaries and (z) the aggregate amount payable by the Borrower and its Restricted 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 Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):4.9.
(a) shall not apply to:
(i) subject to Section 2.4, the incurrence by the Company and Borrower or any Restricted Subsidiary of Indebtedness pursuant to the Credit Facility;
(ii) the issuance by any Restricted Subsidiary of preferred stock (other than Disqualified Stock) to the Borrower, any Restricted Subsidiary of the Borrower or the holders of Equity Interests in any Restricted Subsidiary on a pro rata basis to such holders;
(iii) subject to Section 2.4, the incurrence of Indebtedness or the issuance of preferred stock by the Borrower or any of its Restricted Subsidiaries the proceeds of which are (or the Existing Indebtednesscredit support provided by any such Indebtedness is), in each case, used to finance the construction, capital expenditure and working capital needs of a Cable Business (including, without limitation, payments made pursuant to any License), the acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(biv) subject to Section 2.4, the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of additional Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 million at any time outstanding50 million;
(dv) the incurrence by the Company Borrower or any Restricted Subsidiary of its Restricted Subsidiaries any Permitted Acquired Debt;
(vi) the incurrence by the Borrower or any Subsidiary of Permitted Refinancing Indebtedness issued in exchange for, or the net proceeds of which are used to refundextend, refinance refinance, renew, replace, or replace refund the Bridge Notes, Existing Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture or Indebtedness referred to be incurred under the first paragraph of this Section 4.09 or in clauses (aii), (biii), (c), (div) or (jv) of this paragraph;
above or Indebtedness incurred pursuant to Section 4.9(a) hereof (e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries"Refinancing Indebtedness"); provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
that (1) the principal amount of, and any subsequent 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 Bridge Notes as and to the extent of the Indebtedness being extended, refinanced, renewed, replaced or refunded;
(vii) the issuance of the Preferred Stock in lieu of payment of cash interest on the Subordinated Debentures or transfer the incurrence by the Borrower of Indebtedness represented by the Subordinated Debentures upon the exchange of the Preferred Stock in accordance with the Certificate of Designations therefor;
(viii) Indebtedness under Exchange Rate Contracts, provided that such Exchange Rate Contracts are related to payment obligations under Existing Indebtedness or Indebtedness incurred under Section 4.9.(a) or (b) hereof that are being hedged thereby, and not for speculation and that the aggregate notional amount under each such Exchange Rate Contract does not exceed the aggregate payment obligations under such Indebtedness;
(ix) Indebtedness under Interest Rate Agreements, provided that the obligations under such agreements are related to payment obligations on Existing Indebtedness or Indebtedness otherwise incurred pursuant to Section 4.9.(a) or (b) hereof, and not for speculation;
(x) the incurrence of Indebtedness between the Borrower and any Restricted Subsidiary, between or among Restricted Subsidiaries and between any Restricted Subsidiary and other holders of Equity Interests of such Restricted Subsidiary (or other Persons providing funding on their behalf) on a pro rata basis and on substantially identical principal financial terms; provided, however, that results in if any such Restricted Subsidiary that is the payee of any such Indebtedness being held by ceases to be a Person Restricted Subsidiary or transfers such Indebtedness (other than to the Company Borrower or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any Borrower), such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company events shall be deemed, in each case, to constitute an the incurrence of such Indebtedness by the Company Borrower or such by a Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);at the time of such event; and
(fxi) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company Borrower and/or any Restricted Subsidiary in respect of performance bonds of the Borrower or any Subsidiary or surety bonds provided by the Borrower or any Restricted Subsidiary received in the ordinary course of business in connection with the construction or operation of a Cable Business.
(c) Any redesignation of a Non-Restricted Subsidiary as a Restricted Subsidiary of the Company that was permitted to shall be incurred by another provision deemed for purposes of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed 4.9 to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of Borrower and its Restricted Subsidiaries of additional the Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of such Non-Recourse Debt, provided, however, that if any Restricted Subsidiary as of the time of such redesignation to the extent such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to does not already constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than Borrower or one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Restricted Subsidiaries.
Appears in 1 contract
Samples: Bridge Loan Agreement (NTL Inc /De/)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall Corporation will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall Corporation will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; , provided, however, that the Company Corporation or any of its Restricted Subsidiaries may incur Subordinated Indebtedness (including or Acquired Debt) Debt or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Subordinated Indebtedness or Acquired Debt or issue preferred stock, if the Fixed Charge Coverage Consolidated Total Debt to Consolidated EBITDA Ratio for the CompanyCorporation's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Subordinated Indebtedness or Acquired Debt is incurred or such Disqualified Stock or such preferred stock is issued issued, as the case may be, would not have been at least greater than 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Subordinated Indebtedness or Acquired Debt had been incurred or the Disqualified Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; provided further, that, notwithstanding the covenant described under "Description of the Senior Secured Notes — Certain Covenants — Designation of Restricted and Unrestricted Subsidiaries", any Restricted Subsidiary that ceases to be a Wholly-Owned Subsidiary of the Corporation as a result of such Restricted Subsidiary issuing Capital Stock pursuant to the present covenant shall be deemed to remain a Restricted Subsidiary for all purposes under the Indenture. The first paragraph of this Section 4.09 shall covenant will not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "Permitted Debt"):
(a1) the incurrence by the Company Corporation or any of its Restricted Subsidiaries and the guarantee thereof by any of the Guarantors of Indebtedness and letters of credit (and reimbursement obligations with respect thereto) under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (1), $50 million, provided that the aggregate principal amount of Indebtedness permitted to be incurred by the Corporation at any time pursuant to this clause (1) will be decreased by the principal amount of Indebtedness then incurred by the Corporation pursuant to clauses (3) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the Existing Indebtednessdefinition of "Permitted Liens") of this paragraph;
(b2) the incurrence by the Company Corporation or any Restricted Subsidiary of the Existing Indebtedness (other than Indebtedness permitted under clauses (4), (6), (10), (16) and (17));
(3) Indebtedness incurred by a Receivables Entity in a Qualified Receivables Transaction, provided that, after giving effect to any such incurrence, the aggregate principal amount of Indebtedness at any one time outstanding under this clause (3) does not exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (3), $50 million, provided further, that the aggregate principal amount of Indebtedness permitted to be incurred by any Receivables Entity at any time pursuant to this clause (3) will be decreased by the principal amount of additional Indebtedness then incurred by the Corporation pursuant to clauses (1) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the definition of "Permitted Liens") of this paragraph;
(4) letters of credit and banker's acceptances issued in the ordinary course of business (and reimbursement obligations with respect thereto) in an aggregate principal amount (with letters of credit and banker's acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, as of any date of incurrence of Indebtedness pursuant to this clause (4), when combined with any Existing Indebtedness that comprises of letters of credit and banker's acceptances (with such letters of credit and banker's acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) and all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), $25 million;
(5) the incurrence by the Issuer, the Corporation and the other Guarantors of Indebtedness represented by the Notes, the Junior Notes related Note Guarantees, the Senior Subordinated Exchangeable Debentures and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySenior Subordinated Exchangeable Debenture Guarantees;
(c6) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Attributable Debt in connection with a sale and leaseback transaction or Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of property, plant or equipment used in the business of the Company Corporation or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (c6), not to exceed exceed, as of any date of incurrence of Indebtedness pursuant to this clause (6), $2.5 million at any time outstanding15 million;
(d7) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Intercompany Indebtedness) that was permitted by this the Indenture to be incurred under the first paragraph of this Section 4.09 covenant or clauses (a2), (b), 5) and (c), (d) or (j7) of this paragraph;
(e) 8) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of intercompany Intercompany Indebtedness between or among the Company Corporation and any one or more of its Restricted Subsidiaries or between or among two or more Restricted Subsidiaries; , provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries and (2b) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Corporation or a any of its Restricted Subsidiary of the Company shall Subsidiaries, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Corporation or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e8);
(9) the issuance by any of the Corporation's Restricted Subsidiaries to the Corporation or to any of its Restricted Subsidiaries of shares of preferred stock, provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Corporation or any of its Restricted Subsidiaries and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Corporation or any of its Restricted Subsidiaries will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (9);
(f10) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Cash Management Obligations and Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to business in an aggregate principal amount not exceed $25 million at any floating rate Indebtedness that is permitted by the terms of this Indenture to be one time outstanding;
(g11) the Guarantee guarantee by the Company Issuer, the Corporation or any of the other Guarantors of Indebtedness of the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries that was permitted to be incurred by another provision of this Section 4.09covenant, provided that if the Indebtedness being guaranteed is subordinated to the Notes, then the Guarantee must be subordinated to the same extent as the Indebtedness guaranteed;
(h12) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, unemployment or other insurance or self-insurance obligations, bankers' acceptances, performance, completion and surety bonds, completion guarantees and similar obligations in the ordinary course of business;
(13) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a cheque, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(14) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Corporation or such Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn outs or similar obligations, in each case, incurred or assumed in connection with the acquisition, sale or disposition of any business or assets, or Capital Stock of the Corporation or any of its Subsidiaries, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(15) the incurrence of contingent liabilities arising out of endorsements of cheques and other negotiable instruments for deposit or collection in the ordinary course of business;
(16) the incurrence of Indebtedness, consisting of guarantees of loans or other extensions of credit to or on behalf of current or former officers, directors, employees and consultants (and their spouses and estates) of the Corporation or any of its Restricted Subsidiaries for the purpose of permitting such Persons to purchase or redeem Capital Stock of the Corporation or any of its Restricted Subsidiaries or in connection with the exercise by such Persons of stock options of the Corporation or any of its Restricted Subsidiaries and the funding of the exercise price of such stock options, in an aggregate principal amount not exceed $2 million at any one time outstanding;
(17) Indebtedness of the Corporation or any of its Restricted Subsidiaries to credit card providers, processors or intermediaries in connection with credit card processing or financing services incurred in the ordinary course of business of the Corporation and its Restricted Subsidiaries in an aggregate principal amount not to exceed $25 million;
(18) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness owed to one or more Persons in respect of premium financing or similar deferred payment obligations with respect to insurance policies purchased in the ordinary course of business; and
(19) the incurrence by the Corporation or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any one time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (19), not to exceed $40 million. The Issuer will not incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Issuer or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms, provided, however, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuer or a Guarantor solely by virtue of being unsecured or by virtue of being secured on a junior priority basis. For purposes of determining compliance with this " Description of the Senior Secured Notes — Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock" covenant, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (19) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, the Corporation will be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock, in any manner that complies with this covenant. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; covenant, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges Consolidated Total Debt of the Company Corporation as accrued;
(i) . Notwithstanding any other provision of this covenant, the maximum amount of Indebtedness of that the Company Corporation or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this covenant will not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueof the Indebtedness, as applicable) at in the case of any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(k3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the incurrence by Fair Market Value of such assets at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(b) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 1 contract
Samples: Support Agreement
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall and the Guarantors will not, and shall the Company will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, enter into a guarantee of or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock or preferred interests; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stockstock or preferred interests, if the Fixed Charge Coverage Ratio for the Company's Company and its subsidiaries, on a consolidated basis, for the most recently ended completed four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock is issued or preferred interests are issued, as the case may be, would have been at least 2.0 3.0 to 11.0, 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 the preferred stock or Disqualified Stock preferred interests had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this .
(b) Notwithstanding anything to the contrary therein, Section 4.09 shall 4.13(a) will not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "“Permitted Debt"”):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bi) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Note Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyIssue Date;
(cii) the incurrence by the Company or any of its Restricted Subsidiaries of Existing Indebtedness listed on Schedule I hereto (including the Existing Convertible Notes), but excluding indebtedness under clause (i) above;
(iii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by either (A) Capital Lease Obligations, or (B) mortgage financings or purchase money obligations, in each caseeither case of sub-clause (A) or (B), incurred for the purpose of financing or reimbursing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of propertyproperty (either real or personal), plant or equipment or other fixed or capital assets used or useful in the business of the Company or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), which incurrence occurs within 365 days of such purchase, design, development, construction, installation, expansion, repair or improvement, in an aggregate principal amount, including including, without duplication, all Permitted Refinancing Indebtedness incurred under Section 4.13(b)(v) below to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ciii), not to exceed, at one time outstanding, in the case of each of sub-clause (A) and (B), $10 million;
(iv) Indebtedness (i) attaching to assets acquired by the Company or any Restricted Subsidiary and outstanding on the date on which such assets were acquired by the Company or such Restricted Subsidiary, except to the extent incurred in contemplation thereof or to consummate the relevant transaction, subject to pro forma compliance with the Fixed Charge Coverage Ratio test set forth in Section 4.13(a), and (ii) of a Restricted Subsidiary incurred and outstanding on the date on which such Restricted Subsidiary was acquired by, or merged into, the Company or any Restricted Subsidiary, except to the extent incurred in contemplation thereof or to consummate the relevant transaction, subject to pro forma compliance with the Fixed Charge Coverage Ratio test set forth in Section 4.13(a), in the aggregate principal amount, including, without duplication, all Permitted Refinancing Indebtedness incurred under Section 4.13(b)(v) to refinance any Indebtedness incurred pursuant to this clause, not to exceed $2.5 million at any time outstanding20 million;
(dv) Indebtedness constituting an extension or renewal of, replacement of, or substitution for, or issued in exchange for, or the net proceeds of which are used to repay, redeem, repurchase, refinance or refund, including by way of defeasance (all of the above, for purposes of this Section, “refinance”) then outstanding indebtedness (“Permitted Refinancing Indebtedness”) in an amount not to exceed the principal amount or liquidation value of the indebtedness so refinanced, plus premiums, fees and expenses; provided, that:
(A) in case the Notes are refinanced in part or the indebtedness to be refinanced is pari passu with the Notes, the new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which it is outstanding, is expressly made pari passu with, or subordinated in right of payment to, the remaining Notes;
(B) in case the Indebtedness to be refinanced is Subordinated Indebtedness, the new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which it is outstanding, is expressly made subordinate in right of payment to the Notes at least to the extent that the Indebtedness to be refinanced is subordinated to the Notes;
(C) the new indebtedness does not have a Stated Maturity prior to the Stated Maturity of the Indebtedness to be refinanced, and the Weighted Average Life to Maturity of the new indebtedness is at least equal to the remaining Weighted Average Life to Maturity of the Indebtedness being refinanced;
(D) if the Indebtedness being refinanced is unsecured Indebtedness, such Permitted Refinancing Indebtedness is unsecured Indebtedness; and
(E) in no event may Indebtedness of the Company or any Guarantor be refinanced pursuant to this clause by means of any Indebtedness of any Restricted Subsidiary that is not a Guarantor;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness or Disqualified Stock in an aggregate principal amount (or accreted value, as applicable), including, without duplication, all Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of Section 4.13(b)(v) to refinance any Indebtedness incurred pursuant to this Section 4.09 or clauses (a)clause, (b), (c), (d) or (j) of this paragraphat any time outstanding not to exceed $10.0 million;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness (or the guarantees of any such intercompany Indebtedness) between or among the Company and or any of its Restricted Subsidiaries; provided, however, that:
(iA) the aggregate principal amount of intercompany Indebtedness (or the guarantees of any such intercompany Indebtedness) between or among the Company or any of its Restricted Subsidiaries must be incurred pursuant to an intercompany note (which may take the form of a grid note) that is pledged to the Collateral Agent or the Israeli Security Trustee, as applicable, in accordance with the terms of the applicable Security Agreement; and
(B) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, then such Indebtedness (other than Indebtedness incurred in the ordinary course in connection with the cash or tax management operations of the Company and its Subsidiaries) must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
provided, further, that (1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (eSection 4.13(b)(vii);
(fviii) the incurrence issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such preferred stock to a Person that is not the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (viii);
(ix) Hedging Obligations that are not incurred for speculative purposes but for the purpose of (a) fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding; (b) fixing or hedging currency exchange rate risk with respect to any currency exchanges; or (c) fixing or hedging commodity price risk, including the price or cost of raw materials, emission rights, manufactured products or related commodities, with respect to any commodity purchases or sales;
(gx) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Guarantor, and the guarantee by any Restricted Subsidiary of the Company that is not a Guarantor of Indebtedness of another Restricted Subsidiary that is not a Guarantor, in each case, to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.094.13; provided that if the Indebtedness being guaranteed is subordinated in right of payment to or pari passu with the Notes, then the guarantee must be subordinated or pari passu, as applicable, in right of payment to the same extent as the Indebtedness guaranteed;
(hxi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, unemployment or other insurance or self-insurance obligations, health, disability or other benefits to employees or former employees and their families, bankers’ acceptances and similar obligations in the ordinary course of business;
(xii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(xiii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from customary agreements of the Company or any such Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the acquisition or sale or other disposition of any business, assets or Capital Stock of the Company or any of its Restricted Subsidiaries, other than, in the case of any such disposition by the Company or any of its Restricted Subsidiaries, guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(xiv) the incurrence of contingent liabilities arising out of endorsements of checks and other negotiable instruments for deposit or collection in the ordinary course of business; or
(xv) the incurrence of Indebtedness in the ordinary course of business under any agreement between the Company or any of its Restricted Subsidiaries and any commercial bank or other financial institution relating to Treasury Management Arrangements.
(c) For purposes of determining compliance with this Section 4.13, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xv) of Section 4.13(b), or is entitled to be incurred pursuant to Section 4.13(a), the Company will be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock (based on circumstances existing on the date of such reclassification), in any manner that complies with this covenant. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; covenant, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred. Notwithstanding anything to the contrary in this Section 4.09covenant, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
(d) The amount of any Indebtedness outstanding as of any date will be:
(i) the accreted value of the Indebtedness, in the event that an item case of proposed any Indebtedness meets issued with original issue discount;
(ii) the criteria of more than one principal amount of the categories Indebtedness, in the case of Permitted Debt described any other Indebtedness; and
(iii) in clauses (a) through (k) above, or is entitled to be incurred pursuant to respect of Indebtedness of another Person secured by a Lien on the first paragraph assets of this Section 4.09the specified Person, the Company shall be permitted to classify lesser of:
(A) the Fair Market Value of such item of Indebtedness on assets at the date of its incurrence, or later reclassify all or a portion determination; and
(B) the amount of such item the Indebtedness of Indebtedness, in any manner that complies with this Section 4.09the other Person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 shall 4.09(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a1) the incurrence (A) by the Company and the guarantee by the Guarantors and the Orion Bank Guarantors of additional Indebtedness and letters of credit under Credit Facilities and (B) by Securitization Entities of Indebtedness in Qualified Securitization Transactions in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries of thereunder), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (1), not to exceed the Existing Indebtedness;greater of:
(a) $3.0 billion; or
(b) $5.527 billion less the incurrence by sum, without duplication, of:
(i) the Company and the Guarantors aggregate amount of Indebtedness represented by the Notesall repayments, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date optional or mandatory, of the Junior Note principal of any term Indebtedness under a Credit Facility (other than repayments under Credit Facilities of Excluded Subsidiaries, RECE and its Subsidiaries, REMA and its Subsidiaries or the Seward Subsidiaries) that have been made by xxx Xompany or any of its Restricted Subsidiaries since the Issue Date (excluding the first $500.0 million of such repayments other than repayments made with the proceeds from the issuance of Parity Secured Debt as permitted under this Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively);
(cii) the incurrence aggregate amount, without duplication, of (x) all commitment reductions with respect to any revolving credit borrowings under a Credit Facility that have been made by the Company or any of its Restricted Subsidiaries (other than Credit Facilities of Indebtedness represented Excluded Subsidiaries, RECE and its Subsidiaries, REMA and its Subsidiaries or the Seward Subsidiaries) and (y) all repayments xx xxvolving credit borrowings under the Credit Agreement Priority Facility with the Net Proceeds from an Asset Sale other than temporary repayments pending the final application of such Net Proceeds contemplated by Capital Lease Obligations, mortgage financings the provisions of Section 4.10 hereof (whether or purchase money obligationsnot the commitments thereunder are correspondingly reduced), in each case, since the Issue Date; and
(iii) the aggregate principal amount of Indebtedness incurred for pursuant to clause (5) of this Section 4.09(b) (including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to such clause (5)) that is at the purpose time outstanding;
(2) the incurrence by the Excluded Orion Power Subsidiaries of financing additional Indebtedness and letters of credit under Credit Facilities of an Excluded Orion Power Subsidiary in an aggregate principal amount at any one time outstanding under this clause (2) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of all Excluded Orion Power Subsidiaries thereunder), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (2), not to exceed $1.425 billion less the aggregate amount of all repayments, optional or mandatory, of the principal of any term Indebtedness under a Credit Facility of an Excluded Orion Power Subsidiary that have been made by the Excluded Orion Power Subsidiaries since the Issue Date and less the aggregate amount of all commitment reductions with respect to any revolving credit borrowings under a Credit Facility of an Excluded Orion Power Subsidiary that have been made by the Excluded Orion Power Subsidiaries since the Issue Date; provided that the aggregate principal amount of all Indebtedness permitted to be incurred pursuant to this clause (2) (including all Permitted Refinancing Indebtedness to refund, refinance or replace Indebtedness incurred pursuant to this clause (2)) shall in no event be reduced to less than $150.0 million;
(3) the incurrence by RECE and its Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities of RECE or any part of its Subsidiaries in an aggregate principal amount at any one time outstanding under this clause (3) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of RECE and all Foreign Subsidiaries thereunder) not to exceed 110% of the purchase price amounts committed or cost outstanding under such Credit Facilities on the Issue Date in any currency permitted by the terms of construction such Credit Facilities less the aggregate amount of all repayments, optional or improvement mandatory, of propertythe principal of any term Indebtedness under a Credit Facility of RECE or a Foreign Subsidiary that have been made by RECE or Foreign Subsidiaries since the Issue Date and less the aggregate amount of all commitment reductions with respect to any revolving credit borrowings under a Credit Facility of RECE or a Foreign Subsidiary that have been made by RECE or the Foreign Subsidiaries since the Issue Date; provided that the aggregate principal amount of all such Indebtedness permitted to be incurred pursuant to this clause (3) (including all Permitted Refinancing Indebtedness to refund, plant refinance or equipment used replace Indebtedness incurred pursuant to this clause (3)) shall in no event be reduced to less than the business currency equivalent of $100.0 million;
(4) the incurrence by REMA and its Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities of REMA or any of its Subsidiaries in an aggregate principal amount at any one time outstanding under this clause (4) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of REMA and its Subsidiaries thereunder), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (4), not to exceed $60.0 million;
(5) the incurrence by the Company and/or the Seward Subsidiaries of (A) Permitted PEDFA Bond Indebtedness xxx/xx the guarantee thereof by the Company or such Restricted Subsidiary(B) Indebtedness evidenced by or in support of the Seward Tax-Exempt Bonds, in an aggregate principal amount at xxx xxe time outstanding under this clause (5), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (5), without duplication, not to exceed $600.0 million less the aggregate amount of all repayments, optional or mandatory, of the principal of any Indebtedness incurred pursuant to this clause (5) that have been made by the Company and/or the Guarantors and/or the Seward Subsidiaries since the Issue Date;
(0) xxe incurrence by Texas Genco or TG Holdco or any of its Subsidiaries, (A) after the first acquisition by the Company or TG Holdco of either (i) Equity Interests in Texas Genco or (ii) assets of Texas Genco or any of its Subsidiaries having a Fair Market Value equal to at least 50% of the Fair Market Value of Texas Genco and its Subsidiaries, of Indebtedness under a Credit Facility of Texas Genco or TG Holdco and/or one or more of its Subsidiaries in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c6)(A), not to exceed $2.5 150.0 million at any one time outstanding;
outstanding or (dB) after the incurrence by the Company first acquisition of assets of Texas Genco or any of its Restricted Subsidiaries having a Fair Market Value of Permitted Refinancing less than 50% of the Fair Market Value of Texas Genco and its Subsidiaries, of Indebtedness in exchange for, under a Credit Facility of Texas Genco or the net proceeds of which are used to refund, refinance TG Holdco and/or one or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any more of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstandingamount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j6)(B), not to exceed $5.0 million75.0 million at any one time outstanding; andprovided that any such Indebtedness incurred pursuant to this clause (6) is Non-Recourse to the Company and its Restricted Subsidiaries other than TG Holdco and its Subsidiaries;
(k7) (A) the issuance of Texas Genco Preferred Stock or (B) the incurrence of Indebtedness by Texas Genco, TG Holdco or any of their Subsidiaries or by the Compaxx xxx xxe Guarantors, in each case, to finance the purchase of assets of or Equity Interests in Texas Genco or any of its Subsidiaries, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (7); provided that the aggregate original principal amount of all such Indebtedness plus the aggregate original liquidation preference of such preferred stock does not exceed 50% of the purchase price paid for any such assets or 50% of the Enterprise Value of Texas Genco in the case of any acquisition of Equity Interests; provided further, that any such Indebtedness incurred by Texas Genco, TG Holdco or any of their Subsidiaries is Non-Recourse xx xxx Xompany and its Restricted Subsidiaries other than TG Holdco and its subsidiaries; provided, further, in the case of a purchase of Equity Interests, Texas Genco or such Subsidiary, as applicable, becomes a Restricted Subsidiary of the Company concurrently with the first application of any funds on deposit in the Texas Genco Escrow Account to the payment of the purchase price for such Equity Interests;
(8) the issuance of Specified Junior Securities by the Company, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (8); provided that at least 50% of the net proceeds of such issuance (other than proceeds that are deposited into the Texas Genco Escrow Account) are applied to the repayment of term Indebtedness under the Company's Unrestricted Subsidiaries of Non-Recourse Debt, Credit Facilities; provided, howeverfurther, that if there is any change in the terms of such Indebtedness ceases to be Non-Recourse Debt Specified Junior Securities that results in such securities no longer meeting all of an Unrestricted Subsidiary, the requirements of the definition of "Specified Junior Securities," then such event shall change will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The 8);
(9) the incurrence by the Company shall not incur and its Restricted Subsidiaries of the Existing Indebtedness, including the Convertible Notes, and including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.clause (9);
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the ----- Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries Guarantors may incur Indebtedness or issue preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.25 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), ) as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first provisions of the preceding paragraph of this Section 4.09 shall will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):): --------------
(a) the incurrence by the Company and the Guarantors of Indebtedness under the Credit Facility; provided that the aggregate principal amount of all such Indebtedness (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and the Guarantors thereunder) outstanding under the Credit Facility after giving effect to such incurrence does not exceed an amount equal to $95.0 million;
(b) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bc) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes (including Additional Notes, the Junior Notes ) and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cd) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted SubsidiaryGuarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 10.0 million at any time outstanding;
(de) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace (x) Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses clause (a), (b), (c), (d) or (jb) of this paragraphabove or clause (k) below or (y) the TROL Financing;
(ef) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of intercompany Indebtedness or preferred stock between or among the Company and any of its Restricted Subsidiariesthe Guarantors; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness or preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company Guarantor and (2B) any sale or other transfer of any such Indebtedness or preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company Guarantor shall be deemed, in each case, to constitute an incurrence of such Indebtedness or an issuance of such preferred stock by the Company or such SubsidiaryGuarantor, as the case may be, that was not permitted by this clause (ef);
(fg) the incurrence by the Company or any of its Restricted Subsidiaries the Guarantors of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingObligations;
(gh) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company Guarantor that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Non- Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (ki). The ;
(j) the incurrence by the Company shall not incur or any of the Guarantors of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (including Permitted Debt) that is contractually subordinated in right of payment j), not to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical termsexceed $30.0 million; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through and
(k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, incurrence by the Company shall be permitted or any of the Guarantors of up to classify such item $34.5 million of Indebtedness resulting from any future recharacterization of the TROL Financing as a liability on the date balance sheet of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09the Company.
Appears in 1 contract
Samples: Indenture (Timco Engine Center Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall and the Guarantors will not, and shall the Company will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, enter into a guarantee of or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock or preferred interests; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stockstock or preferred interests, if the Fixed Charge Coverage Ratio for the Company's Company and its subsidiaries, on a consolidated basis, for the most recently ended completed four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock is issued or preferred interests are issued, as the case may be, would have been at least 2.0 3.0 to 11.0, 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 the preferred stock or Disqualified Stock preferred interests had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall .
(b) Notwithstanding anything to the contrary therein, Section 4.13(a) will not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "“Permitted Debt"”):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bi) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Note Guarantees to be issued on the date Issue Date;
(ii) the incurrence by the Company or any of this Indenture its Restricted Subsidiaries of Existing Indebtedness listed on Schedule I hereto (including the Existing Convertible Notes and the date of the Junior Note Indenturerelated note guarantees with respect thereto), respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelybut excluding indebtedness under clause (i) above;
(ciii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by either (A) Capital Lease Obligations, or (B) mortgage financings or purchase money obligations, in each caseeither case of sub-clause (A) or (B), incurred for the purpose of financing or reimbursing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of propertyproperty (either real or personal), plant or equipment or other fixed or capital assets used or useful in the business of the Company or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), which incurrence occurs within 365 days of such purchase, design, development, construction, installation, expansion, repair or improvement, in an aggregate principal amount, including including, without duplication, all Permitted Refinancing Indebtedness incurred under Section 4.13(b)(v) below to refund, refinance or replace any Indebtedness incurred pursuant to this clause (iii), not to exceed, at one time outstanding, in the case of each of sub-clause (A) and (B), $10 million;
(civ) Indebtedness (i) attaching to assets acquired by the Company or any Restricted Subsidiary and outstanding on the date on which such assets were acquired by the Company or such Restricted Subsidiary, except to the extent incurred in contemplation thereof or to consummate the relevant transaction, subject to pro forma compliance with the Fixed Charge Coverage Ratio test set forth in Section 4.13(a), and (ii) of a Restricted Subsidiary incurred and outstanding on the date on which such Restricted Subsidiary was acquired by, or merged into, the Company or any Restricted Subsidiary, except to the extent incurred in contemplation thereof or to consummate the relevant transaction, subject to pro forma compliance with the Fixed Charge Coverage Ratio test set forth in Section 4.13(a), in the aggregate principal amount, including, without duplication, all Permitted Refinancing Indebtedness incurred under Section 4.13(b)(v) to refinance any Indebtedness incurred pursuant to this clause, not to exceed $2.5 million at any time outstanding20 million;
(dv) Indebtedness constituting an extension or renewal of, replacement of, or substitution for, or issued in exchange for, or the net proceeds of which are used to repay, redeem, repurchase, refinance or refund, including by way of defeasance (all of the above, for purposes of this Section, “refinance”) then outstanding indebtedness (“Permitted Refinancing Indebtedness”) in an amount not to exceed the principal amount or liquidation value of the indebtedness so refinanced, plus premiums, fees and expenses; provided, that:
(A) in case the Notes are refinanced in part or the indebtedness to be refinanced is pari passu with the Notes, the new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which it is outstanding, is expressly made pari passu with, or subordinated in right of payment to, the remaining Notes;
(B) in case the Indebtedness to be refinanced is Subordinated Indebtedness, the new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which it is outstanding, is expressly made subordinate in right of payment to the Notes at least to the extent that the Indebtedness to be refinanced is subordinated to the Notes;
(C) the new indebtedness does not have a Stated Maturity prior to the Stated Maturity of the Indebtedness to be refinanced, and the Weighted Average Life to Maturity of the new indebtedness is at least equal to the remaining Weighted Average Life to Maturity of the Indebtedness being refinanced;
(D) if the Indebtedness being refinanced is unsecured Indebtedness, such Permitted Refinancing Indebtedness is unsecured Indebtedness; and
(E) in no event may Indebtedness of the Company or any Guarantor be refinanced pursuant to this clause by means of any Indebtedness of any Restricted Subsidiary that is not a Guarantor;
(vi) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness or Disqualified Stock in an aggregate principal amount (or accreted value, as applicable), including, without duplication, all Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of Section 4.13(b)(v) to refinance any Indebtedness incurred pursuant to this Section 4.09 or clauses (a)clause, (b), (c), (d) or (j) of this paragraphat any time outstanding not to exceed $10.0 million;
(evii) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness (or the guarantees of any such intercompany Indebtedness) between or among the Company and or any of its Restricted Subsidiaries; provided, however, that:
(iA) the aggregate principal amount of intercompany Indebtedness (or the guarantees of any such intercompany Indebtedness) between or among the Company or any of its Restricted Subsidiaries must be incurred pursuant to an intercompany note (which may take the form of a grid note) that is pledged to the Collateral Agent or the Israeli Security Trustee, as applicable, in accordance with the terms of the applicable Security Agreement; and
(B) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, then such Indebtedness (other than Indebtedness incurred in the ordinary course in connection with the cash or tax management operations of the Company and its Subsidiaries) must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
provided, further, that (1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (eSection 4.13(b)(vii);
(fviii) the incurrence issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such preferred stock to a Person that is not the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (viii);
(ix) Hedging Obligations that are not incurred for speculative purposes but for the purpose of (a) fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding; (b) fixing or hedging currency exchange rate risk with respect to any currency exchanges; or (c) fixing or hedging commodity price risk, including the price or cost of raw materials, emission rights, manufactured products or related commodities, with respect to any commodity purchases or sales;
(gx) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Guarantor, and the guarantee by any Restricted Subsidiary of the Company that is not a Guarantor of Indebtedness of another Restricted Subsidiary that is not a Guarantor, in each case, to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.094.13; provided that if the Indebtedness being guaranteed is subordinated in right of payment to or pari passu with the Notes, then the guarantee must be subordinated or pari passu, as applicable, in right of payment to the same extent as the Indebtedness guaranteed;
(hxi) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, unemployment or other insurance or self-insurance obligations, health, disability or other benefits to employees or former employees and their families, bankers’ acceptances and similar obligations in the ordinary course of business;
(xii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(xiii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from customary agreements of the Company or any such Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the acquisition or sale or other disposition of any business, assets or Capital Stock of the Company or any of its Restricted Subsidiaries, other than, in the case of any such disposition by the Company or any of its Restricted Subsidiaries, guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(xiv) the incurrence of contingent liabilities arising out of endorsements of checks and other negotiable instruments for deposit or collection in the ordinary course of business; or
(xv) the incurrence of Indebtedness in the ordinary course of business under any agreement between the Company or any of its Restricted Subsidiaries and any commercial bank or other financial institution relating to Treasury Management Arrangements.
(c) For purposes of determining compliance with this Section 4.13, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xv) of Section 4.13(b), or is entitled to be incurred pursuant to Section 4.13(a), the Company will be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock (based on circumstances existing on the date of such reclassification), in any manner that complies with this covenant. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; covenant, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be utilized, calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred. Notwithstanding anything to the contrary in this Section 4.09covenant, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.
(d) The amount of any Indebtedness outstanding as of any date will be:
(i) the accreted value of the Indebtedness, in the event that an item case of proposed any Indebtedness meets issued with original issue discount;
(ii) the criteria of more than one principal amount of the categories Indebtedness, in the case of Permitted Debt described any other Indebtedness; and
(iii) in clauses (a) through (k) above, or is entitled to be incurred pursuant to respect of Indebtedness of another Person secured by a Lien on the first paragraph assets of this Section 4.09the specified Person, the Company shall be permitted to classify lesser of:
(A) the Fair Market Value of such item of Indebtedness on assets at the date of its incurrence, or later reclassify all or a portion determination; and
(B) the amount of such item the Indebtedness of Indebtedness, in any manner that complies with this Section 4.09the other Person.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's any of its Restricted Subsidiaries may incur issue shares of preferred stock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, the sum of (x) Indebtedness or issue of the Company and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stockstock of Restricted Subsidiaries and (z) the aggregate amount payable by the Company and its Restricted Subsidiaries, if on a consolidated basis, upon redemption of Disqualified Stock to the Fixed Charge Coverage Ratio extent such amount is not included in the preceding clause (y) shall be less than the product of Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Existing IndebtednessCredit Facility;
(bii) the issuance by any Restricted 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 Restricted Subsidiary on a pro rata basis to such holders;
(iii) the incurrence by the Company and the Guarantors of Indebtedness represented by or the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date issuance of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence preferred stock by the Company or any of its Restricted Subsidiaries the proceeds of which are (or the credit support provided by any such Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsis), in each case, incurred for used to finance the purpose construction, capital expenditure and working capital needs of financing all or any part of the purchase price or cost of construction or improvement of propertya Cable Business (including, plant or equipment used in the business of the Company or such Restricted Subsidiarywithout limitation, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred payments made pursuant to this clause (cany License), not to exceed $2.5 million at any time outstandingthe acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and100.0 million at any time;
(kv) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of any Permitted Acquired Debt;
(vi) the incurrence by the Company that was not permitted by this clause or any Subsidiary of Indebtedness issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, or refund the Notes, Existing Indebtedness or Indebtedness referred to in clauses (ki). The Company shall not incur any , (ii), (iii), (iv) or (v) above or Indebtedness incurred pursuant to Section 4.08(a) hereof (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms"REFINANCING INDEBTEDNESS"); provided, however, that no (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 the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of being extended, refinanced, renewed, replaced or refunded, and (B) a stated maturity no earlier than the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09stated maturity of, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrencebeing extended, refinanced, renewed, replaced or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.refunded; and
Appears in 1 contract
Samples: Indenture (NTL Communications Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and that the Company shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; providedPROVIDED, howeverHOWEVER, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's its Restricted Subsidiaries may incur Indebtedness or and Restricted Subsidiaries of the Company may issue preferred stock, shares of Preferred Stock if the Fixed Charge Coverage Ratio for the Company's Adjusted Consolidated Leverage Ratio would have been less than 5.0 to 1, on a pro forma basis after giving effect to the incurrence of such Indebtedness or the issuance of such Preferred Stock, as the case may be, and the application of the net proceeds therefrom. Notwithstanding the foregoing, the Company and, to the extent set forth below, its Restricted Subsidiaries may incur the following (each of which shall be given independent effect):
(a) Indebtedness of the Company under the Notes and this Indenture;
(b) Permitted Working Capital Indebtedness of the Company and its Restricted Subsidiaries;
(c) Existing Indebtedness (other than Permitted Working Capital Indebtedness or Indebtedness under the Letter of Credit Facility);
(d) Indebtedness of the Company and its Restricted Subsidiaries under the Letter of Credit Facility;
(e) Capital Expenditure Indebtedness, Capital Lease Obligations and purchase money Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $70.0 million at any time outstanding;
(i) Hedging Obligations of the Company and its Restricted Subsidiaries covering Indebtedness of the Company or such Restricted Subsidiary (which Indebtedness is otherwise permitted to be incurred under this covenant) to the extent the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates; or (ii) repurchase agreements, reverse repurchase agreements or similar agreements re- lating to marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; provided that the terms of such agreements comply with the guidelines set forth in FederalAFinancial Agreements of Depository Institutions with Securities and Others (or any successor guidelines), as adopted by the Comptroller of the Currency;
(g) Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $45.0 million at any time outstanding;
(h) Indebtedness of the Company representing guarantees of Indebtedness incurred by one of its Restricted Subsidiaries pursuant to, and in compliance with, another provision of this covenant;
(i) Indebtedness of the Company or any of its Restricted Subsidiaries representing guarantees of a portion of the Indebtedness of Wheeling-Nisshin which is not greater than the Company's or such Restricted Subsidiary's pro rata ownership of the outstanding Equity Interests in Wheeling-Nisshin; PROVIDED, HOWEVER, that (i) in the case of a guarantee of any such Indebtedness by the Company, such Indebtedness is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes and (ii) at the time of incurrence and after giving effect to the Indebtedness of Wheeling-Nisshin which is being guaranteed, the Consolidated Interest Coverage Ratio of Wheeling-Nisshin for its most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the any additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bj) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such its Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Subsidiaries representing guarantees of Indebtedness incurred of Wheeling-Nisshin required to refund, refinance or replace any Indebtedness incurred be made pursuant to this clause (c), the Letter of Undertaking not to exceed $2.5 million at any time outstanding10.0 million;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(ek) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; providedPROVIDED, howeverHOWEVER, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Wholly Owned Re- stricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);; and
(fl) any Permitted Refinancing Indebtedness representing a replacement, renewal, refinancing or extension of all or any portion of the Indebtedness permitted under the first paragraph and clauses (a) and (c) of this covenant. In the event that the incurrence by the Company or of any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is would be permitted by the terms first paragraph set forth above or one or more of this Indenture to be outstanding;
(g) the Guarantee by provisions set forth in the second paragraph above, the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
may designate (h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with an officer's certificate delivered to the same terms, and Trustee) the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes particular provision of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes Indenture pursuant to Article 8 hereofwhich it is incurring such Indebtedness.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (WHX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application . The provisions of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bi) the incurrence by the Company and the Subsidiary Guarantors of term loan and revolving credit Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date letters of this Indenture and the date of the Junior Note Indenture, respectively, or credit pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including Credit Agreement and all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ci), not to exceed $2.5 million at any time outstanding;
(dii) the incurrence by the Company and the Subsidiary Guarantors of the Existing Indebtedness;
(iii) the incurrence by the Company of Indebtedness represented by the Notes and the incurrence by the Subsidiary Guarantors of the Subsidiary Guarantees;
(iv) the incurrence by the Company or the Subsidiary Guarantors of Indebtedness represented by Capital Lease Obligations, mortgage financing or purchase money obligations;
(v) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses pursuant to clause (a), (b), (c), (dii) or (jiii) of this paragraph;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries the Subsidiary Guarantors of intercompany Indebtedness indebtedness between or among the Company and any of its Restricted Subsidiariesthe Subsidiary Guarantors; provided, however, that:
that (ia) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1b) (A) any subsequent issuance or transfer of Equity Interests Interest that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company Guarantor and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company Guarantor shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such SubsidiarySubsidiary Guarantor, as the case may be, that was not permitted by this clause (evi), and (c) no Subsidiary shall incur Indebtedness owing to the Company unless such Indebtedness pursuant to this clause (c) is subordinated in right of payment to the Notes and has a final maturity date later than the final maturity date of the Notes;
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging (a) interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding; (b) the value of foreign currencies purchased or received by Company in the ordinary course of business; or (c) commodities purchased in the ordinary course of business for use in a Permitted Business and not for speculation;
(gviii) the Guarantee guarantee by the Company or any of the Subsidiary Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company Guarantor that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jix) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refundin respect of performance, refinance or replace any Indebtedness incurred pursuant to this clause (j)surety and similar bonds provided by the Company and the Subsidiaries in the ordinary course of business, not to exceed $5.0 million; andand refinancings thereof,
(kx) the incurrence by the Company's Unrestricted Company or any of its Subsidiaries of NonIndebtedness for letters of credit relating to workers' compensation claims and self-Recourse Debt, provided, however, that if insurance or similar requirements in the ordinary course of business; and
(xi) the incurrence by the Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence its Subsidiaries of Indebtedness by a Restricted Subsidiary arising from guarantees of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness or any Subsidiary or other agreements of the Company or a Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Subsidiary, other than guarantees of Indebtedness incurred by any person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition, provided that the maximum aggregate liability in respect of all such indebtedness shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of at no time exceed the gross proceeds actually received by the Company solely by virtue of being unsecuredand its Subsidiaries in connection with such disposition. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxi) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Newcor Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company Parent shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, “incur”), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Parent shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that that, any Guarantor (other than the Company Parent) may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, that is expressly subordinated to both the Notes and the Company's Subsidiaries may incur Indebtedness or issue preferred stockSenior Secured Notes, if (i) the Fixed Charge Coverage Ratio for the Company's Parent’s most recently ended four full fiscal quarters for which internal publicly available financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued issued, as the case may be, would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional such Indebtedness had been incurred or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-fiscal quarter period and (ii) if the Consolidated Leverage Ratio for the Parent’s most recently ended four full fiscal quarters for which publicly available financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such preferred stock is issued, as the case may be, would have been equal to or less than 4.0 to 1.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if such Indebtedness had been incurred or the Disqualified Stock or the preferred stock had been issued, as the case may be, at the beginning of such four-fiscal quarter period. The first paragraph of this .
(b) Section 4.09 4.3(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(i) the incurrence by any of the Parent’s Restricted Subsidiaries of Indebtedness under or in the form of Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (i) not to exceed the greater of (x) the sum of (a) $100 million and (b) the aggregate amount of Indebtedness outstanding under any Credit Facilities in existence on March 8, 2013, and (y) the Borrowing Base of the Parent and its Restricted Subsidiaries on a consolidated basis; provided that the total Indebtedness incurred under this clause (i) by Restricted Subsidiaries that on the date of such incurrence are not Guarantors shall not exceed $50.0 million at any time;
(ii) Existing Indebtedness (other than Indebtedness described in clauses (i) and (iii) of this Section 4.3(b));
(iii) (A) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company Issuer and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees thereof to be issued on the Issue Date and (B) the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Senior Secured Notes and the Senior Secured Notes Guarantees to be issued on or about the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyIssue Date;
(civ) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation, lease, repair or improvement of property, plant or equipment used in the business of the Company Parent or any of its Restricted Subsidiaries, whether through the direct ownership, lease or purchase of assets or the purchase or ownership of ordinary shares of any Person owning such Restricted Subsidiary, assets (including any Indebtedness deemed to be incurred in connection with such purchase) in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 25.0 million at any time outstanding;
(dv) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany IndebtednessIndebtedness between or among the Parent and a Restricted Subsidiary (provided that the Intercompany Loans may be refunded or refinanced to the extent required in connection with any permitted refinancing of the Notes or the Senior Secured Notes)) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 4.3(a) or clauses (aii), (biii), (c), (dv) or (jvi);
(vi) Indebtedness of a Person incurred and outstanding on the date on which such Person becomes a Restricted Subsidiary of the Parent or any of its Restricted Subsidiaries or is merged, consolidated, amalgamated or otherwise combined with, or all or substantially all of its assets are transferred to, the Parent or any of its Restricted Subsidiaries (other than Indebtedness incurred in contemplation of, or in connection with, the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary of or was otherwise acquired by the Parent or a Restricted Subsidiary of the Parent); provided, however, that either (a) the aggregate principal amount (or accreted value, as applicable) of such Indebtedness, when taken together with all other Indebtedness of the Parent and any Restricted Subsidiaries incurred pursuant to clause (a) of this paragraphproviso to clause (vi) and outstanding on the date of such incurrence, does not exceed $50.0 million or (b) on the date that such Person is acquired by the Parent or a Restricted Subsidiary or merged, consolidated, amalgamated or otherwise combined with the Parent or any of its Restricted Subsidiaries, the Parent would have been able to incur $1.00 of additional Indebtedness pursuant to Section 4.3(a) after giving effect to the incurrence of such Indebtedness pursuant to this clause (vi) or the Fixed Charge Coverage Ratio improves;
(evii) the incurrence by the Company Parent or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Parent and any of its Restricted Subsidiaries; provided, however, that:
(i1) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Issuer or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the CompanyIssuer, or its Note the Guarantee, in the case of a Guarantor; and
(12) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Parent or a Restricted Subsidiary of the Company Parent and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Parent or a Restricted Subsidiary of the Company shall Parent, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Parent or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the issuance by any of the Parent’s Restricted Subsidiaries to the Parent or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(1) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Parent or a Restricted Subsidiary of the Parent; and
(2) any sale or other transfer of any such preferred stock to a Person that is not either the Parent or a Restricted Subsidiary of the Parent, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (viii);
(ix) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Hedging Obligations that are not entered into for speculative purposes;
(x) any guarantee of the Notes or of Indebtedness permitted to be incurred under this Indenture;
(xi) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance bonds, completion guarantees and warranties and surety bonds in the ordinary course of business (including guarantees or indemnities related thereto);
(xii) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(xiii) Indebtedness of the Parent or any of its Restricted Subsidiaries consisting of advance or extended payment terms in the ordinary course of business;
(xiv) Indebtedness of the Parent or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to bank or insurance company bonds or guarantees and VAT guarantees issued in the ordinary course of business; provided, however, that, upon valid demand being made under such reimbursement obligations, such demands are satisfied within 90 days of the date of such demand;
(xv) Indebtedness of the Parent or any of its Restricted Subsidiaries owed on a short-term basis to banks or other financial institutions (including overdraft facilities) incurred in the ordinary course of business of the Parent and its Restricted Subsidiaries maintained with such banks or financial institutions and which arises in connection with ordinary banking arrangements to manage cash balances of the Parent and its Restricted Subsidiaries;
(xvi) customer deposits and advance payments received in the ordinary course of business from customers for goods purchased in the ordinary course of business;
(xvii) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Parent or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Capital Stock of a Restricted Subsidiary, other than guarantees of Indebtedness of the Restricted Subsidiary disposed of, or incurred or assumed by any Person acquiring all or any portion of such business, assets or Capital Stock for the purpose of fixing or hedging interest rate risk with financing such acquisition; provided that the maximum liability of the Parent and its Restricted Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including the Fair Market Value of non-cash proceeds (measured at the time received and without giving effect to any floating rate Indebtedness that is permitted subsequent changes in value) actually received by the terms of this Indenture to be outstandingParent and its Restricted Subsidiaries in connection with such disposition;
(gxviii) Indebtedness of the Issuer or any Restricted Subsidiary consisting of (i) the Guarantee financing of insurance premiums or (ii) take-or-pay obligations contained in supply arrangements, in each case, in the ordinary course of business;
(xix) the incurrence by the Company Parent or any of the Guarantors its Restricted Subsidiaries of Indebtedness not otherwise permitted to have been incurred under this Indenture in an aggregate principal amount (or accreted value, as applicable) which, when taken together with all other Indebtedness of the Company Parent and any Restricted Subsidiaries incurred pursuant to this clause (xix) and outstanding on the date of such incurrence, does not exceed $15.0 million at any time outstanding; and
(xx) the incurrence of Indebtedness represented by the issuance of PIK Notes. The Parent shall not incur, and shall not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Parent or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes or the applicable Guarantee; provided, however, that no Indebtedness shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Parent solely by virtue of being unsecured or by virtue of being secured on a junior or second Lien basis or by virtue of not being Guaranteed. For purposes of determining compliance with this Section 4.3, in the event that an item or portion of an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xix) above, or is entitled to be incurred pursuant to Section 4.3(a), the Issuer, the Parent and any Restricted Subsidiary of the Company that was Parent shall be permitted to be incurred by another provision classify such item or portion of an item of Indebtedness on the date of its incurrence, and later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09;
4.3, except that all Indebtedness outstanding on the Effective Date under any Credit Facilities shall be deemed initially incurred under clause (hi) the of Section 4.3(b). The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same termsterms (including any payment-in-kind interest on the Notes), the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.shall
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt)) and shall not, and the Company shall not permit any Subsidiary Guarantor to, issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries that are not Subsidiary Guarantors to issue any shares of preferred stockstock (other than Qualified Subsidiary Stock); provided, however, that the Company or any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue shares of preferred stock (including Disqualified Stock) if, and in each case, (1) the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage to Adjusted Operating Cash Flow Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding as of the date on which such additional Indebtedness is incurred or such preferred stock or Disqualified Stock or preferred stock is issued would have been at least 2.0 7.0 to 11 or less, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at as of the beginning date of such four-quarter periodcalculation and (2) no Default or Event of Default would occur as a consequence thereof. The first paragraph of this Section 4.09 Company shall not, and shall not prohibit the incurrence of permit any Subsidiary Guarantor to, incur any Indebtedness that is contractually subordinated to any other Indebtedness of the following items Company or of such Subsidiary Guarantor, as the case may be, unless such Indebtedness is also contractually subordinated to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, on substantially identical terms; provided, however, that no Indebtedness shall be deemed to be contractually subordinated to any other Indebtedness solely by virtue of being unsecured.
(b) The foregoing provisions shall not apply to (collectively, "Permitted Debt"):
(ai) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt or the issuance by such Unrestricted Subsidiaries of preferred stock; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary or any such preferred stock becomes preferred stock (other than Qualified Subsidiary Stock) of a Restricted Subsidiary, as the case may be, such event shall be deemed to constitute an incurrence of Indebtedness by, or an issuance of preferred stock (other than Qualified Subsidiary Stock) of, as the case may be, a Restricted Subsidiary of the Company;
(ii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness pursuant to one or more Bank Facilities if the aggregate principal amount at any time outstanding incurred pursuant to this clause (ii) does not exceed $50.0 million;
(iii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(biv) the incurrence by the Company and the Guarantors of Indebtedness represented by under the Subordinated Exchange Notes to pay interest on outstanding Subordinated Notes, ;
(v) Indebtedness under the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(cvi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that (1) if the Company or a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Notes or the Subsidiary Guarantee of such Subsidiary Guarantor, as the case may be, and (2)(A) any subsequent issuance or transfer of Equity Interests that result in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (B) any sale or other transfer of such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be; 50
(vii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount not to exceed $7.5 million at any time outstanding, including all Permitted Refinancing Indebtedness Debt incurred pursuant to clause (viii) below to refund, replace or refinance or replace any Indebtedness incurred pursuant to this clause (cvii), not to exceed $2.5 million at any time outstanding;
(dviii) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness Debt in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(eix) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between (in addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Debt incurred pursuant to clause (viii) above to refund, replace or among the Company and refinance any of its Restricted SubsidiariesIndebtedness incurred pursuant to this clause (ix), not to exceed $7.5 million; provided, however, that:and
(ix) if the guarantee by the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kx) above, above or is entitled permitted to be incurred pursuant to Section 4.09(a) hereof and also meets the first paragraph criteria of this Section 4.09one or more of the categories of Permitted Debt described in clauses (i) through (x) above, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and may from time to time reclassify such item of Indebtedness in any manner in which such item could be incurred at the time of such reclassification. For purposes of this paragraph, "Indebtedness" includes Disqualified Stock and preferred stock of Subsidiaries. Accrual of interest and the accretion of accreted value will not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, Disqualified Stock or preferred stock, as applicable (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries (and the Guarantee thereof by any Restricted Subsidiary or the Company, as applicable) of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit (other than letters of credit contemplated by Section 4.09(b)(12)) being deemed to have a principal amount equal to the maximum potential liability of the Company and the Restricted Subsidiaries thereunder), when taken together with the aggregate principal amount of all then-outstanding Indebtedness incurred pursuant to Section 4.09(b)(14), not to exceed the greater of:
(A) the Designated Amount; or
(B) the Borrowing Base as of the date of such incurrence;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors of Indebtedness represented by (A) the Notes, the Junior Notes and the related Subsidiary Guarantees and the 2014 Notes and the related 2014 Subsidiary Guarantees to be issued on the date of this Indenture Indenture, and (B) the Exchange Notes and the date of related Subsidiary Guarantee and the Junior Note Indenture, respectively, or 2014 Exchange Notes and the related 2014 Subsidiary Guarantee to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of propertyproperty (real or personal), plant or equipment (whether through the direct purchase of assets or through the purchase of the Capital Stock of any Person owning such assets) used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed the greater of (i) $2.5 300.0 million at any time outstandingor (ii) 3.0% of the Consolidated Net Tangible Assets of the Company and its Restricted Subsidiaries;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clause (2), (3), (4), (5), (12), (13), (17) or (18) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of obligations with respect to letters of credit securing obligations entered into in the ordinary course of business to the extent such letters of credit are not drawn upon or, if drawn upon, such drawing is reimbursed within five Business Days following receipt of a demand for reimbursement;
(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any a Guarantor is the obligor on such IndebtednessIndebtedness and such Indebtedness is held by a Restricted Subsidiary other than such Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a such Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance of shares of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which, in either case, results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of preferred stock (except to the Company or another Restricted Subsidiary) shall be deemed in each case to be an issuance of such shares of preferred stock that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of of:
(A) Hedging Obligations that are incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gB) Indebtedness in respect of performance, surety or appeal bonds provided in the ordinary course of business; and
(C) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price or similar obligations of the Company or any of its Restricted Subsidiaries incurred in connection with the disposition of any business, assets or Subsidiary of the Company in an aggregate amount not to exceed the gross proceeds actually received by the Company or any Restricted Subsidiary in connection with such disposition;
(10) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h11) the accrual incurrence by the Company or any of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence its Restricted Subsidiaries of Indebtedness or an issuance represented by letters of Disqualified Stock credit for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness account of the Company or any such Restricted Subsidiary Subsidiary, as the case may be, in order to provide security for workers' compensation claims, environmental remediation or other environmental matters or payment obligations in connection with self-insurance or similar requirements, in each case to the extent arising in the ordinary course of business;
(12) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit pursuant to or made in connection with that certain Insurance Allocation and Services Agreement, dated November 27, 2002, between the Net Proceeds thereof are promptly:Company and Unisource Worldwide, Inc., in an aggregate principal amount at any time outstanding not to exceed $25.0 million;
(13) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by industrial revenue bonds incurred to finance the construction or improvement of their respective operations in an aggregate principal amount at any time outstanding pursuant to this clause (13), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (13), not to exceed the greater of (i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
$200.0 million or (ii) 2.0% of the Consolidated Net Tangible Assets of the Company and its Restricted Subsidiaries;
(14) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Receivables Program; provided, however, that the aggregate principal amount of Indebtedness incurred pursuant to this clause (14) at any one time outstanding, when taken together with the aggregate principal amount of all then-outstanding Indebtedness incurred pursuant to Section 4.09(b)(1), does not exceed the Designated Amount;
(15) the incurrence by the Company or a Restricted Subsidiary of Indebtedness to the extent the net proceeds thereof are promptly deposited to defease all outstanding Notes as described in Article 8 hereof or all outstanding 2014 Notes as described in Article 8 of the 2014 Notes Indenture;
(16) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar institution inadvertently drawn against insufficient funds in the ordinary course of business;
(17) the incurrence by any Foreign Subsidiary of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to Article 8 hereof.this clause (17), not to exceed $500.0 million; and
(j18) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) or the issuance of Disqualified Stock by the Company or preferred stock by any Restricted Subsidiary in an aggregate principal amount or liquidation preference (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j18), not to exceed $5.0 500.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (Georgia Pacific Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently whether or otherwisenot such liability is contingent, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, provided that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries any Subsidiary Guarantor may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.5 to 1, 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) hereof shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, Disqualified Stock or preferred stock, as applicable (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries (and the Guarantee thereof by any Restricted Subsidiary or the Company, as applicable) of Indebtedness and letters of credit under any Credit Facility, such Indebtedness in an aggregate principal amount not to exceed $1,500,000,000;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, Notes or the Junior Notes and the related incurrence by any Subsidiary Guarantees to be issued on the date Guarantor of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyIndebtedness represented by a Subsidiary Guarantee;
(c4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of propertyproperty (real or personal), plant or equipment (whether through the direct purchase of assets or through the purchase of the Capital Stock of any Person owning such assets) used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed the greater of (i) $2.5 200 million at any time outstandingor (ii) 5% of the Consolidated Net Tangible Assets of the Company;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) hereof or clause (2), (3), (4), (5), (12) or (14) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of obligations with respect to letters of credit securing obligations entered into in the ordinary course of business to the extent such letters of credit are not drawn upon or, if drawn upon, such drawing is reimbursed within five Business Days following receipt of a demand for reimbursement;
(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, provided that:
(iA) if the Company or any a Subsidiary Guarantor is the obligor on such IndebtednessIndebtedness and such Indebtedness is held by a Restricted Subsidiary other than a Subsidiary Guarantor, such Indebtedness must (unless subject to a Permitted Lien referred to in clause (1) of the definition thereof or a Fall Away Permitted Lien referred to in clause (1) of the definition thereof) be expressly subordinated in right of payment to the prior payment in full in cash of all Obligations of the Company with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a Subsidiary Guarantor; and
(1i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of (except for the grant of a Permitted Lien or Fall Away Permitted Lien on) any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each casecase (i) and (ii), to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance of shares of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that (i) any subsequent issuance or transfer of any Capital Stock or any other event which, in either case, results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or (ii) any other subsequent transfer of any such shares of preferred stock (except to the Company or another Restricted Subsidiary) shall be deemed, in each case (i) and (ii), in each case to be an issuance of such shares of preferred stock that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of of:
(A) Hedging Obligations that are not incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gB) Indebtedness in respect of performance, surety or appeal bonds provided in the Guarantee ordinary course of business; and
(C) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price, earn-out or similar obligations of the Company or any of its Restricted Subsidiaries incurred in connection with the disposition of any business, assets or Subsidiary of the Company in an aggregate amount not to exceed the gross proceeds actually received by the Company or any of Restricted Subsidiary in connection with such disposition;
(10) the Guarantors guarantee by (a) the Company or a Subsidiary Guarantor of Indebtedness of the Company or a Restricted Subsidiary or (b) a Restricted Subsidiary of the Company that is not a Subsidiary Guarantor of Indebtedness of any other Restricted Subsidiary of the Company that is not a Subsidiary Guarantor, in each case (a) and (b), that was permitted to be incurred by another provision of this Section 4.09;
(h11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers' compensation claims, environmental remediation or other environmental matters or payment obligations in connection with self-insurance or similar requirements, in each case to the extent arising in the ordinary course of business;
(12) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Receivables Program, provided that the aggregate principal component of amounts outstanding under the Receivables Program at any one time shall not exceed the greater of (a) $500 million and (b) 75% of the aggregate amount of the total Receivables and Related Assets of the Company and its Restricted Subsidiaries existing at the time such Indebtedness is incurred;
(13) the incurrence by the Company or a Restricted Subsidiary of Indebtedness to the extent the net proceeds thereof are promptly deposited to defease all Outstanding Notes as described in Article 8 hereof;
(14) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including pursuant to a Credit Facility) or the issuance of Disqualified Stock by the Company or preferred stock by any Restricted Subsidiary in an aggregate principal amount or liquidation preference (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (14), not to exceed $250 million;
(15) the incurrence by the Company of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided that such Indebtedness is extinguished within five Business Days of incurrence; and
(16) the incurrence by a Restricted Subsidiary of the Company of Acquired Debt; provided that the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Acquired Debt is incurred would have been at least 3 to 1 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if such Acquired Debt had been incurred at the beginning of such four-quarter period.
(c) For purposes of determining compliance with this Section 4.09:
(1) in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (16) of Section 4.09(b) hereof, or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company shall be permitted to classify all or a portion of such item of Indebtedness on the date of its incurrence, or, subject to Section 4.09(c)(2) below, later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09;
(2) Indebtedness under Credit Facilities outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(1) hereof, and Indebtedness under a Receivables Program outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(12) hereof, and the Company shall not be permitted to reclassify any portion of such Indebtedness thereafter;
(3) the outstanding principal amount of any particular Indebtedness shall be counted only once and any obligations arising under any guarantee, Lien, letter of credit or similar instrument supporting such Indebtedness shall not be counted twice;
(4) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i5) the amount of Indebtedness issued at a price that is less than its principal amount will be equal to the amount of the Company or any Restricted Subsidiary to the extent that the Net Proceeds liability in respect thereof are promptly:
(i) used to purchase Notes tendered determined in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionaccordance with GAAP; and
(k6) the incurrence by the Company's Unrestricted Subsidiaries if Obligations in respect of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt letters of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be credit are incurred pursuant to any Credit Facility and are being treated as incurred pursuant to clause (1) of Section 4.09(b) hereof and the first paragraph letters of this Section 4.09credit relate to other Indebtedness, such other Indebtedness will be deemed not incurred to the extent of such Obligations. With respect to overdraft lines, the Company amount of any outstanding Indebtedness shall be permitted to classify determined net of cash held for the benefit of the relevant entity by the institution creating such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09overdraft.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's any of its Restricted Subsidiaries may incur issue shares of preferred stock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, the sum of (x) Indebtedness or issue of the Company and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stockstock of Restricted Subsidiaries and (z) the aggregate amount payable by the Company and its Restricted Subsidiaries, if on a consolidated basis, upon redemption of Disqualified Stock to the Fixed Charge Coverage Ratio extent such amount is not included in the preceding clause (y) shall be less than the product of Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Existing IndebtednessCredit Facility;
(bii) the issuance by any Restricted 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 Restricted Subsidiary on a pro rata basis to such holders;
(iii) the incurrence by the Company and the Guarantors of Indebtedness represented by or the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date issuance of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence preferred stock by the Company or any of its Restricted Subsidiaries the proceeds of which are (or the credit support provided by any such Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsis), in each case, incurred for used to finance the purpose construction, capital expenditure and working capital needs of financing all or any part of the purchase price or cost of construction or improvement of propertya Cable Business (including, plant or equipment used in the business of the Company or such Restricted Subsidiarywithout limitation, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred payments made pursuant to this clause (cany License), not to exceed $2.5 million at any time outstandingthe acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and100.0 million at any time;
(kv) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of any Permitted Acquired Debt;
(vi) the incurrence by the Company that was not permitted by this clause or any Subsidiary of Indebtedness issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, or refund the Notes, Existing Indebtedness or Indebtedness referred to in clauses (ki). The Company shall not incur any , (ii), (iii), (iv) or (v) above or Indebtedness incurred pursuant to Section 4.08(a) hereof (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms"REFINANCING INDEBTEDNESS"); provided, however, that no Indebtedness of (1) the Company shall be deemed to be contractually subordinated principal amount of, and any premium payable in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09respect of, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.such
Appears in 1 contract
Samples: Indenture (NTL Communications Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Subsidiaries Restricted Subsidiary to, Incur, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock Indebtedness) and shall not permit any of its Restricted Subsidiaries that is not a Guarantor to issue any shares of preferred stockPreferred Stock; provided, however, that the Company and its Restricted Subsidiaries may incur Incur Indebtedness (including Acquired Debt) or issue Disqualified StockIndebtedness), and the Company's Restricted Subsidiaries that are not Guarantors may incur Indebtedness or issue preferred stockPreferred Stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding on the date on which of such additional Indebtedness Incurrence or issuance and after giving effect thereto, the Consolidated Adjusted Debt to EBITDA Ratio is incurred or less than 6.00 to 1.00 (this test being referred to herein as the “Leverage Test”). For the purpose of the calculation of the Leverage Test, with respect to any period included in such Disqualified Stock or preferred stock is issued would have been at least 2.0 calculation, Consolidated EBITDA, the components of Consolidated Interest Expense and Consolidated Adjusted Debt shall be calculated with respect to 1, determined such period by the Company in good faith on a pro forma basis (including a pro forma application of the net proceeds therefromand consistent with Permitted Adjustments), as if giving effect to any Permitted Acquisition, Asset Disposition or Incurrence or redemption or repayment of Indebtedness that has given rise to the additional Indebtedness had been incurred need for such calculation, has occurred during such period or has occurred after such period and on or prior to the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning date of such four-quarter period. calculation.
(b) The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence Incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bii) the incurrence Incurrence by the Company and its Restricted Subsidiaries of the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively(not including any Additional Notes);
(ciii) the incurrence (A) Purchase Money Indebtedness and mortgage financings (excluding Capital Lease Obligations and Synthetic Lease Obligations) hereafter Incurred by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount that does not exceed $70,000,000 at any one time outstanding and (B) Indebtedness hereafter incurred by the Company or any of its Restricted Subsidiaries under any Channel Financing Facility in an aggregate principal amount that, including all Permitted Refinancing when taken together with the aggregate then outstanding principal amount of Indebtedness incurred to refund, refinance or replace any Indebtedness under all other Channel Financing Facilities of the Company and its Restricted Subsidiaries incurred pursuant to under this clause (ciii), does not to exceed $2.5 million 30,000,000 at any one time outstanding;
(div) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, Refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under Incurred by the first paragraph Company or such Restricted Subsidiary; Table of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;Contents
(ev) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness (A) between or among the Company and any Restricted Subsidiaries of the Company and (B) consisting of debits and credits among the Company and its Restricted SubsidiariesSubsidiaries pursuant to a Centralized Cash Management System; provided, however, that:
that (i1) if any intercompany Indebtedness which is borrowed by the Company or any a Guarantor from a Restricted Subsidiary that is the obligor on such Indebtedness, such Indebtedness must not a Guarantor shall be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, Notes or its Note Guarantee, in the case of a such Guarantor; and
’s Guarantee and (12) (x) any subsequent issuance or transfer of Equity Interests Capital Stock that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and Company, or (2y) any sale or other transfer of any such Indebtedness to a Person that is not either other than the Company or a Restricted Subsidiary of the Company Company, or a lender or agent upon exercise of remedies under a pledge of such Indebtedness under the Credit Agreement, shall be deemed, in each casecase of the foregoing clauses (2)(x) and (y), to constitute an incurrence Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);
(fvi) the incurrence Incurrence by the Company or any of its Restricted Subsidiaries of Hedging Interest Swap Obligations that are incurred Incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(gvii) Indebtedness of the Company or any Restricted Subsidiary under the Credit Agreement in an aggregate amount at any time outstanding not to exceed $900,000,000, less, to the extent a permanent repayment and/or commitment reduction is required thereunder as a result of such application, the aggregate amount of Net Proceeds applied to repayments under the Credit Agreement in accordance with Section 5.05;
(viii) the Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness under Currency Agreements;
(ix) the Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or any of its Restricted Subsidiaries represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers’ compensation claims, payment obligations in connection with self-insurance or similar requirements in the Ordinary Course of Business;
(x) the Incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of performance bonds, bankers’ acceptances, workers’ compensation claims, completion guarantees, letters of credit surety or appeal bonds, payment obligations in connection with self-insurance or similar obligations Incurred in the Ordinary Course of Business; Table of Contents
(xi) the Guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred Incurred by another provision of this Section 4.095.04;
(hxii) Indebtedness arising from agreements of the Company or a Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price or similar obligations, in each case, Incurred in connection with an Asset Disposition or acquisition permitted by this Indenture or other sale or disposition of assets permitted under this Indenture;
(xiii) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than Indebtedness Incurred in contemplation of, in connection with, as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Subsidiary of or was otherwise acquired by the Company); provided, however, that on the date that such Restricted Subsidiary is acquired by the Company, the Company would have been able to Incur $1.00 of additional Indebtedness under the first paragraph of this Section 5.04 pursuant to the Leverage Test after giving effect to the Incurrence of such Indebtedness pursuant to this clause (xiii);
(A) Indebtedness represented by Capital Lease Obligations (other than Capital Lease Obligations described in the following clause (B)) and Synthetic Lease Obligations hereafter Incurred by the Company or any of its Restricted Subsidiaries in an aggregate principal amount that, when taken together with the Remaining Present Value of such outstanding Capital Lease Obligations and Synthetic Lease Obligations relating to Sale and Leaseback Transactions entered into in accordance with Section 8.05(b)(ii) of the Credit Agreement (as in effect on the date of this Indenture), does not exceed $150,000,000 at any time outstanding and (B) Indebtedness represented by Capital Lease Obligations in connection with the Data Center Sale and Leaseback Transactions and the Wireless Tower Sale and Leaseback Transactions and in each case otherwise in compliance with the conditions set forth in the applicable definition thereof; provided that (x) the accrual aggregate outstanding Remaining Present Value of (I) all leases entered into in connection with all Data Center Sale and Leaseback Transactions, plus (II) all leases entered into in connection with all Wireless Tower Sale and Leaseback Transactions, plus (y) all Indebtedness represented by Capital Lease Obligations and Synthetic Lease Obligations entered into under clause (A) does not at any time exceed $250,000,000 in the aggregate;
(xv) the Incurrence of other Indebtedness not to exceed $100,000,000 in aggregate principal amount at any time outstanding; and
(xvi) the Incurrence by a Receivables Subsidiary of Indebtedness in a Qualified Receivables Transaction that is without recourse (other than pursuant to representations, warranties, covenants, indemnities and performance guarantees customarily entered into in connection with a Receivables financing) to the Company or to any Restricted Subsidiary of the Company or its assets (other than such Receivables Subsidiary and its subsidiaries and assets), in an amount not to exceed $150,000,000 in aggregate principal amount at any time outstanding. Table of Contents
(c) For purposes of determining compliance with this Section 5.04, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness described in Sections 5.04(b)(i) through (xvi) or is entitled to be Incurred pursuant to Section 5.04(a), the Company shall, in its sole discretion, classify (or later reclassify) such item of Indebtedness in any manner that complies with this Section 5.04 and will only be required to include the amount and type of such Indebtedness in one of such clauses of Section 5.04(b) or pursuant to Section 5.04(a); provided that Indebtedness outstanding under the Credit Agreement as of the Closing Date shall be deemed to have been Incurred pursuant to clause (vii) of Section 5.04(b). Accrual of interest, the accretion or of accreted value, amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, terms as the Indebtedness on which such interest is being paid and the payment any other issuance of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock securities paid-in-kind shall not be deemed to be an incurrence Incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided5.04, in each but such case, that the amount thereof is amounts shall be included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary Consolidated Adjusted Debt to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered provided for in an offer to purchase made as a result of a Change in Controlsuch definition. In addition, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company may, at any time, change the classification of an item of Indebtedness (or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debtportion thereof) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other clause of Section 5.04(b) or to Indebtedness of properly Incurred under Section 5.04(a), provided that the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall would be permitted to classify Incur such item of Indebtedness on (or portion thereof) pursuant to such other clause of Section 5.04(b) or Section 5.04(a), as the date case may be, at such time of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09reclassification.
Appears in 1 contract
Samples: Indenture (Cincinnati Bell Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee guaranty or otherwise become directly or indirectly liable, contingently or otherwise, liable with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockstock that is Disqualified Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's any of its Restricted Subsidiaries may incur issue shares of preferred stock that is Disqualified Stock if after giving effect to such issuance or incurrence on a pro forma basis, the sum of (x) Indebtedness or issue of the Company and its Restricted Subsidiaries, on a consolidated basis, (y) the liquidation value of outstanding preferred stockstock of Restricted Subsidiaries and (z) the aggregate amount payable by the Company and its Restricted Subsidiaries, if on a consolidated basis, upon redemption of Disqualified Stock to the Fixed Charge Coverage Ratio extent such amount is not included in the preceding clause (y) shall be less than the product of Annualized Pro Forma EBITDA for the Company's most recently ended four full latest fiscal quarters 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 would have been at least 2.0 to 1multiplied 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 incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. quarter.
(b) The first paragraph of this foregoing limitations in Section 4.09 4.08(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company and its or any Restricted Subsidiaries Subsidiary of Indebtedness pursuant to the Existing IndebtednessCredit Facility;
(bii) the issuance by any Restricted 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 Restricted Subsidiary on a pro rata basis to such holders;
(iii) the incurrence by the Company and the Guarantors of Indebtedness represented by or the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date issuance of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence preferred stock by the Company or any of its Restricted Subsidiaries the proceeds of which are (or the credit support provided by any such Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsis), in each case, incurred for used to finance the purpose construction, capital expenditure and working capital needs of financing all or any part of the purchase price or cost of construction or improvement of propertya Cable Business (including, plant or equipment used in the business of the Company or such Restricted Subsidiarywithout limitation, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred payments made pursuant to this clause (cany License), not to exceed $2.5 million at any time outstandingthe acquisition of Cable Assets or the Capital Stock of a Qualified Subsidiary;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jiv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 50 million; and;
(kv) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if Company or any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of any Permitted Acquired Debt;
(vi) the incurrence by the Company that was not permitted by this clause or any Subsidiary of Indebtedness issued in exchange for, or the proceeds of which are used to extend, refinance, renew, replace, or refund the Notes, Existing Indebtedness or Indebtedness referred to in clauses (ki). The Company shall not incur any , (ii), (iii), (iv) or (v) above or Indebtedness incurred pursuant to Section 4.08(a) hereof (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms"Refinancing Indebtedness"); provided, however, that no (1) the principal amount of, and any premium payable in respect of, such Refinancing Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.not exceed the
Appears in 1 contract
Samples: Bridge Loan Agreement (NTL Inc /De/)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. .
(b) The first paragraph provisions of this Section 4.09 4.09(a) shall not prohibit the incurrence of any of the following items of Indebtedness Indebtedness, Disqualified Stock or preferred stock, as applicable (collectively, "Permitted Debt"):
(a1) the incurrence by the Company or any of its Restricted Subsidiaries (and the Guarantee thereof by any Restricted Subsidiary or the Company, as applicable) of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit (other than letters of credit contemplated by Section 4.09(b)(12)) being deemed to have a principal amount equal to the maximum potential liability of the Company and the Restricted Subsidiaries thereunder), when taken together with the aggregate principal amount of all then-outstanding Indebtedness incurred pursuant to Section 4.09(b)(14), not to exceed the greater of:
(A) the Designated Amount; or
(B) the Borrowing Base as of the date of such incurrence;
(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b3) the incurrence by the Company and the Guarantors Guarantor of Indebtedness represented by (A) the Notes, the Junior Notes and the related Subsidiary Guarantees Guarantee and the 2010 Notes and the related 2010 Subsidiary Guarantee to be issued on the date of this Indenture Indenture, and (B) the Exchange Notes and the date of related Subsidiary Guarantee and the Junior Note Indenture, respectively, or 2010 Exchange Notes and the related 2010 Subsidiary Guarantee to be issued pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyRegistration Rights Agreement;
(c4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of propertyproperty (real or personal), plant or equipment (whether through the direct purchase of assets or through the purchase of the Capital Stock of any Person owning such assets) used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amountamount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c4), not to exceed the greater of (i) $2.5 300.0 million at any time outstandingor (ii) 3.0% of the Consolidated Net Tangible Assets of the Company and its Restricted Subsidiaries;
(d5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clause (2), (3), (4), (5), (12), (13), (17) or (18) of this Section 4.09 or clauses (a4.09(b), (b), (c), (d) or (j) of this paragraph;
(e6) the incurrence by the Company or any of its Restricted Subsidiaries of obligations with respect to letters of credit securing obligations entered into in the ordinary course of business to the extent such letters of credit are not drawn upon or, if drawn upon, such drawing is reimbursed within five Business Days following receipt of a demand for reimbursement;
(7) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any the Guarantor is the obligor on such IndebtednessIndebtedness and such Indebtedness is held by a Restricted Subsidiary other than the Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note the Subsidiary Guarantee, in the case of a the Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e7);
(f8) the issuance of shares of preferred stock by a Restricted Subsidiary to the Company or another Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which, in either case, results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of preferred stock (except to the Company or another Restricted Subsidiary) shall be deemed in each case to be an issuance of such shares of preferred stock that was not permitted by this clause (8);
(9) the incurrence by the Company or any of its Restricted Subsidiaries of of:
(A) Hedging Obligations that are incurred in the ordinary course of business and not for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingspeculative purposes;
(gB) Indebtedness in respect of performance, surety or appeal bonds provided in the ordinary course of business; and
(C) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price or similar obligations of the Company or any of its Restricted Subsidiaries incurred in connection with the disposition of any business, assets or Subsidiary of the Company in an aggregate amount not to exceed the gross proceeds actually received by the Company or any Restricted Subsidiary in connection with such disposition;
(10) the Guarantee guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit for the account of the Company or such Restricted Subsidiary, as the case may be, in order to provide security for workers' compensation claims, environmental remediation or other environmental matters or payment obligations in connection with self-insurance or similar requirements, in each case to the extent arising in the ordinary course of business;
(12) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by letters of credit pursuant to or made in connection with that certain Insurance Allocation and Services Agreement, dated November 27, 2002, between the Company and Unisource Worldwide, Inc., in an aggregate principal amount at any time outstanding not to exceed $25.0 million;
(13) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by industrial revenue bonds incurred to finance the construction or improvement of their respective operations in an aggregate principal amount at any time outstanding pursuant to this clause (13), including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace Indebtedness incurred pursuant to this clause (13), not to exceed the greater of (i) $200.0 million or (ii) 2.0% of the Consolidated Net Tangible Assets of the Company and its Restricted Subsidiaries;
(14) the incurrence by any Receivables Subsidiary of Indebtedness pursuant to a Receivables Program; provided, however, that the aggregate principal amount of Indebtedness incurred pursuant to this clause (14) at any one time outstanding, when taken together with the aggregate principal amount of all then-outstanding Indebtedness incurred pursuant to Section 4.09(b)(1), does not exceed the Designated Amount;
(15) the incurrence by the Company or a Restricted Subsidiary of Indebtedness to the extent the net proceeds thereof are promptly deposited to defease all outstanding Notes as described in Article 8 hereof or all outstanding 2010 Notes as described in Article 8 of the 2010 Notes Indenture;
(16) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar institution inadvertently drawn against insufficient funds in the ordinary course of business;
(17) the incurrence by any Foreign Subsidiary of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (17), not to exceed $500.0 million; and
(18) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness or the issuance of Disqualified Stock by the Company or preferred stock by any Restricted Subsidiary in an aggregate principal amount or liquidation preference (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (18), not to exceed $500.0 million.
(c) For purposes of determining compliance with this Section 4.09:
(1) in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (18) of Section 4.09(b), or is entitled to be incurred pursuant to Section 4.09(a) hereof, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or, subject to Section 4.09(c)(2) below, later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09;
(2) Indebtedness under Credit Facilities outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(1) hereof and Indebtedness under a Receivables Program outstanding on the date of this Indenture shall be deemed to have been incurred on such date in reliance on the exception provided by Section 4.09(b)(14) hereof, and the Company shall not be permitted to reclassify any portion of such Indebtedness thereafter;
(3) the outstanding principal amount of any particular Indebtedness shall be counted only once and any obligations arising under any guarantee, Lien, letter of credit or similar instrument supporting such Indebtedness shall not be double counted;
(4) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k5) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence maximum amount of Indebtedness by that the Company or a Restricted Subsidiary of the Company that was may incur pursuant to this Section 4.09 will not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment exceeded, with respect to any other Indebtedness outstanding Indebtedness, due solely to the result of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, fluctuations in the event that an item exchange rates of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09currencies.
Appears in 1 contract
Samples: Indenture (Fort James Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), Indebtedness) and that the Company shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Consolidated Interest Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 2.00 to 1, determined 1 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall not prohibit Notwithstanding the incurrence of any of foregoing, the Company and, to the extent set forth below, its Restricted Subsidiaries may incur the following items (each of Indebtedness (collectively, "Permitted Debt"which shall be given independent effect):
(a) Indebtedness of the incurrence by Company under the Notes and this Indenture;
(b) Permitted Working Capital Indebtedness of the Company and its Restricted Subsidiaries;
(c) Existing Indebtedness (other than Permitted Working Capital Indebtedness or Indebtedness under the Letter of Credit Facility);
(d) Indebtedness of the Company and its Restricted Subsidiaries under the Letter of the Existing IndebtednessCredit Facility;
(be) the incurrence by Capital Expenditure Indebtedness, Capital Lease Obligations and purchase money Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $50 million at any time outstanding;
(i) Hedging Obligations of the Guarantors Company and its Restricted Subsidiaries covering Indebtedness of the Company or such Restricted Subsidiary (which Indebtedness represented is otherwise permitted to be incurred under this covenant) to the extent the notional principal amount of any such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates; or (ii) repurchase agreements, reverse repurchase agreements or similar agreements relating to marketable direct obligations issued or unconditionally guaranteed by the NotesUnited States Government or issued by any agency thereof and backed by the full faith and credit of the United States, the Junior Notes and the related Subsidiary Guarantees to be issued on in each case maturing within one year from the date of this Indenture acquisition; provided that the terms of such agreements comply with the guidelines set forth in Federal-Financial Agreements of Depository Institutions with Securities and Others (or any successor guidelines), as adopted by the date Comptroller of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyCurrency;
(cg) Indebtedness of the incurrence Company and its Restricted Subsidiaries in an aggregate principal amount not to exceed $30 million at any time outstanding;
(h) Indebtedness of the Company representing guarantees of Indebtedness incurred by one of its Restricted Subsidiaries pursuant to, and in compliance with, another provision of this covenant;
(i) Indebtedness of the Company or any of its Restricted Subsidiaries representing guarantees of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part a portion of the purchase price Indebtedness of Wheeling-Nisshin which is not greater than the Company's or cost such Restricted Subsidiary's pro rata ownership of construction or improvement the outstanding Equity Interests in Wheeling-Nisshin; provided, however, that (i) such Indebtedness is expressly subordinated to the prior payment in full in cash of propertyall Obligations with respect to the Notes and (ii) at the time of incurrence and after giving effect to the Indebtedness of Wheeling-Nisshin which is being guaranteed, plant or equipment used in the business Consolidated Interest Coverage Ratio of Wheeling-Nisshin for its most recently ended four full fiscal quarters for which internal financial statements are available would have been at least 2.00 to 1, determined on a pro forma basis as if any additional Indebtedness had been incurred at the beginning of such four-quarter period;
(j) Indebtedness of the Company or such its Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Subsidiaries representing guarantees of Indebtedness incurred of Wheeling-Nisshin required to refund, refinance or replace any Indebtedness incurred be made pursuant to this clause (c), the Letter of Undertaking not to exceed $2.5 million at any time outstanding10 million;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(ek) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Wholly Owned Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii) (A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly Owned Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly Owned Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e);; and
(fl) Indebtedness under the Term Loan Agreement; and
(m) any Permitted Refinancing Indebtedness representing a replacement, renewal, refinancing or extension of Indebtedness permitted under the first paragraph and clauses (c) and (l) of this covenant. In the event that the incurrence by the Company or of any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is would be permitted by the terms first paragraph set forth above or one or more of this Indenture to be outstanding;
(g) the Guarantee by provisions set forth in the second paragraph above, the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
may designate (h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with an officer's certificate delivered to the same terms, and Trustee) the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes particular provision of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes Indenture pursuant to Article 8 hereofwhich it is incurring such Indebtedness.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"” or an “incurrence”) any Indebtedness (including Acquired Debt)Indebtedness, and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stockDisqualified Stock; provided, however, that the Company or any Guarantor may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Consolidated Interest Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (basis, including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, incurred or issued at the beginning of such four-quarter period. The first paragraph .
(b) Notwithstanding the foregoing, the provisions of this Section 4.09 shall 10.10(a) hereof will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(a) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;.
(c) the incurrence by the The Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace shall not incur any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries of including Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture is contractually subordinated in right of payment to be incurred under any other Indebtedness of the first paragraph Company, unless such Indebtedness is also contractually subordinated in right of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) payment to the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries8.5% Notes on substantially identical terms; provided, however, that:
(i) if that solely for the Company or avoidance of doubt and without any Guarantor is the obligor on such Indebtednessother implication, such no Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, deemed to be contractually subordinated in each case, to constitute an incurrence right of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect payment to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of other Indebtedness of the Company solely by virtue of being unsecured.
(d) For purposes of determining compliance with this Section 10.10, in the event that an item of proposed Indebtedness or a Restricted Subsidiary Disqualified Stock meets the criteria of more than one of the Company that was permitted categories contained in clauses (1) through (15) of the definition of Permitted Indebtedness, or is entitled to be incurred by another provision pursuant to Section 10.10(a) hereof, the Company will be permitted to classify such item of Indebtedness or Disqualified Stock on the date of its incurrence or issuance, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock, in any manner that complies with this Section 4.09;
(h) the 10.10. The accrual of interest, the accumulation of dividends, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall Stock, will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.0910.10; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company Consolidated Interest Expense as accrued;
(i) . Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness of that the Company or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 10.10 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(A) the incurrence by fair market value of such asset at the Company or any date of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 milliondetermination; and
(kB) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to other Person; and
(3) the Notes on substantially identical terms; provided, however, that no Indebtedness principal amount of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09Indebtedness, in the event that an item case of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of any other Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: First Supplemental Indenture (Frontier Oil Corp /New/)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee Guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall Borrower will not issue any Disqualified Stock and shall will not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness .
(including Acquired Debtb) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application The provisions of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall 7.1(a) hereof will not prohibit the incurrence of of, or prohibit the Borrower and its Subsidiaries from remaining liable with respect to, any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(ai) Existing Debt;
(ii) the incurrence by the Company and its Restricted Subsidiaries Borrower of Indebtedness represented by the Existing IndebtednessLoan pursuant to this Agreement;
(biii) the incurrence by the Company and the Guarantors Borrower of Indebtedness represented by the Notes, the Junior Senior Subordinated Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySecurities Purchase Agreement;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company or any of its Restricted Subsidiaries Borrower of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtednessthat is described in Section 7.1(b)(ii) that was permitted by this Indenture to be incurred under the first paragraph of this and Section 4.09 or clauses (a7.1(b)(iv), (b), (c), (d) or (j) of this paragraph;
(ev) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of intercompany Indebtedness between owed to the Borrower or among the Company and any of its Restricted Wholly Owned Subsidiaries; provided, however, that:
(iA) if the Company Borrower or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect to the NotesLoans, in the case of the CompanyBorrower, or its Note the Loan Guarantee, in the case of a Guarantor; and;
(B) in each case where the Borrower or any Guarantor is the creditor, such Indebtedness is evidenced by a demand promissory note pledged to the Administrative Agent for the ratable benefit of the Lenders pursuant to the Guarantee and Collateral Agreement;
(C) the following will be deemed, in each case, to constitute an incurrence of Indebtedness by the Borrower or one of its Subsidiaries, as the case may be, that was not permitted by this Section 7.1(b)(v);
(1) any subsequent issuance or transfer of Equity Interests that results result in any such Indebtedness originally incurred pursuant to this Section 7.1(b)(v) being held by a Person other than the Company Borrower or a Restricted Subsidiary of the Company and thereof, and
(2) any sale or other transfer of any such Indebtedness originally incurred pursuant to this Section 7.1(b)(v) to a Person that is not either the Company Borrower or a Restricted Wholly Owned Subsidiary thereof;
(vi) the issuance by any of the Company shall Borrower’s Subsidiaries to the Borrower or to any of its Wholly Owned Subsidiaries of shares of preferred stock; provided, however, that the following will be deemed, in each case, to constitute an incurrence issuance of preferred stock by such Indebtedness by the Company or such Subsidiary, as the case may be, Subsidiary that was not permitted by this clause Section 7.1(b)(vi):
(e)A) any subsequent issuance or transfer of Equity Interests that results in any preferred stock originally issued pursuant to this Section 7.1(b)(vi) being held by a Person other than the Borrower or a Wholly Owned Subsidiary of the Borrower; and
(B) any sale or transfer of any preferred stock originally issued pursuant to this Section 7.1(b)(vi) to a Person that is not either the Borrower or a Wholly-Owned Subsidiary of the Borrower;
(fvii) the incurrence by the Company Borrower or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(gviii) the Guarantee by the Company Borrower or any of the Guarantors its Subsidiaries of Indebtedness of the Company Borrower or a Restricted Subsidiary of the Company Borrower that was permitted to be incurred by another provision of this Section 4.097.1; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Loans, then the Guarantee shall be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(hix) the incurrence by the Borrower or any of its Subsidiaries of Indebtedness in respect of workers compensation claims, self-insurance obligations, bankers’ acceptances, performance and surety bonds in the ordinary course of business;
(x) the incurrence by the Borrower of any Indebtedness represented by the Series A Preferred Stock and Series B Preferred Stock outstanding or issued on the Closing Date;
(xi) the incurrence by the Borrower or any of its Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days; and
(xii) Indebtedness incurred pursuant to the AskMen Acquisition Documents; provided that the aggregate amount of such Indebtedness does not exceed the Subsequent Acquisition Indebtedness Cap applicable to such AskMen Acquisition Documents. The accrual of interest, the accretion or amortization of original issue discountdiscount on any Indebtedness, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof7.1.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incurINCUR") any Indebtedness (including Acquired Debt), Indebtedness) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired DebtIndebtedness) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries that are Subsidiary Guarantors may incur Indebtedness or issue preferred stock, if if: (i) the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; and (ii) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; provided, that no Guarantee may be incurred pursuant to this paragraph unless the guaranteed Indebtedness is incurred by the Company or a Subsidiary Guarantor pursuant to this paragraph. The first paragraph of this Section 4.09 foregoing provisions shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):apply to:
(ai) the incurrence by the Company or a Subsidiary Guarantor of New Senior Debt (and Guarantees thereof by Subsidiaries that are Subsidiary Guarantors and by the Company, if applicable) in an aggregate principal amount at any time outstanding (with letters of credit obligations being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries that are Subsidiary Guarantors with respect thereto) not to exceed an amount equal to $45,000,000;
(ii) the incurrence by the Company of the Existing Indebtedness;
(biii) the incurrence by the Company of Indebtedness represented by the Notes and by the Subsidiary Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries Subsidiary Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligationsPurchase Money Obligations, in each case, case incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment property used in the business of the Company or such Restricted SubsidiarySubsidiary Guarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 million 10,000,000 at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries Subsidiary Guarantor of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph4.10;
(evi) the incurrence by the Company or any of its Restricted Wholly Owned Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Wholly Owned Subsidiaries or between or among any Wholly Owned Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Wholly Owned Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Wholly Owned Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries that are Subsidiary Guarantors of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;incurred; and
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(jviii) the incurrence by the Company or any of its Restricted Subsidiaries that are Subsidiary Guarantors of additional Indebtedness (including Acquired Debtin addition to Indebtedness permitted by any other clause of this paragraph) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), outstanding not to exceed the sum of $5.0 million2,500,000; and
(k) the incurrence Notwithstanding any other provision of this covenant, a Guarantee of Indebtedness permitted by the Company's Unrestricted Subsidiaries terms of Non-Recourse Debt, provided, however, that if any this Indenture at the time such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event was incurred shall be deemed to not constitute an a separate incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Samples: Indenture (RBX Corp)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company and its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or ), the Company may issue Disqualified Stock, Stock and the Company's ’s Restricted Subsidiaries may incur Indebtedness or issue preferred stockstock if, if in any such case, the Fixed Charge Coverage Ratio for the Company's ’s most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefromtherefrom and including as set forth in the definition of “Fixed Charge Coverage Ratio”), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(a1) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company or and/or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose and letters of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred credit pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(d) the incurrence by the Company Credit Facilities or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiariesotherwise; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, provided that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, of all Indebtedness then classified as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness having been incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.reliance
Appears in 1 contract
Samples: Indenture (Penn National Gaming Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company or any of its Restricted Subsidiaries may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness Stock or issue preferred stock, stock if the Fixed Charge Coverage Consolidated EBITDA Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(ai) the incurrence by Indebtedness of the Company and its Restricted Subsidiaries of under the New Bank Credit Facility;
(ii) Existing Indebtedness;
(biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, Obligations in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), amount not to exceed $2.5 5.0 million at any time outstanding;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (d) or (j) of this paragraphincurred;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was is not permitted by this clause (evi);
(fvii) the incurrence Indebtedness consisting of Permitted Hedging Obligations;
(viii) Indebtedness in respect of performance, surety and similar bonds provided by the Company or any in the ordinary course of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingbusiness;
(gix) the Guarantee by the Company or any of the Guarantors guarantee of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(hx) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form respect of additional Indebtedness with the same termsindustrial revenue bonds or other similar governmental and municipal bonds, and the payment of dividends on Disqualified Stock mortgage financings or purchase money obligations in the form of additional shares of the same class of Disqualified Stock shall an aggregate amount not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedexceed $5.0 million;
(ixi) Indebtedness in respect of (A) letters of credit (other than letters of credit issued under the New Bank Credit Facility) incurred in the ordinary course of business for the purpose of securing foreign trade credit obligations of the Company or any a Restricted Subsidiary of the Company and (B) Acquired Debt in connection with the acquisition of new assets or a new Subsidiary; provided that such Indebtedness was incurred by the prior owner of such assets or such Subsidiary prior to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence acquisition by the Company or any one of its Restricted Subsidiaries and was not incurred in connection with, or in contemplation of, such acquisition by the Company or such Restricted Subsidiary; and provided further that the aggregate principal amount (or accreted value, as applicable) of all Indebtedness incurred pursuant to this clause (xi) shall not exceed $5.0 million at any one time outstanding;
(xii) additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (jxii), not to exceed $5.0 10.0 million; and
(kxiii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse DebtDebt of an Unrestricted Subsidiary, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was is not permitted by this clause (kxiii). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxiii) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to shall, in its sole discretion, classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09 and such item of Indebtedness shall be treated as having been incurred pursuant to only one of such clauses or pursuant to the first paragraph of this Section 4.09. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 4.09.
Appears in 1 contract
Samples: Indenture (Panther Transport Inc)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's Subsidiaries Guarantors may incur Indebtedness or issue Disqualified Stock or preferred stock, stock if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred incurred, or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The provisions of the first paragraph of this Section 4.09 covenant shall not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtIndebtedness"):
(ai) the incurrence by the Company of Indebtedness under Credit Facilities (and the Guarantee thereof by the Guarantors); provided that the aggregate principal amount of all Indebtedness outstanding under this clause (i) after giving effect to such incurrence does not exceed an amount equal to $875.0 million (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) less the amount of proceeds of Asset Sales applied to repay any such term Indebtedness or revolving Indebtedness if such repayment of revolving Indebtedness resulted in a corresponding commitment reduction (excluding any such payments to the extent refinanced at the time of repayment);
(ii) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness, the Senior Notes and the Guarantees thereof;
(biii) (A) the incurrence guarantee by the Company and or any of the Guarantors of Indebtedness represented of the Company or a Restricted Subsidiary of the Company or (B) the incurrence of Indebtedness of a Restricted Subsidiary to the extent that such Indebted- ness is supported by the Notesa letter of credit, the Junior Notes and the related Subsidiary Guarantees in each case that was permitted to be issued on the date incurred by another provision of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelycovenant;
(civ) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by (including Capital Lease Obligations) to finance the acquisition (including by direct purchase, mortgage financings by lease or purchase money obligations, in each case, incurred for indirectly by the purpose of financing all or any part acquisition of the purchase price or cost Capital Stock of construction a Person that becomes a Restricted Subsidiary as a result of such acquisition) or improvement of property, plant assets or equipment used in the business of the Company property (real or such Restricted Subsidiary, personal) in an aggregate principal amountamount which, when aggregated with the principal amount of all other Indebtedness then outstanding pursuant to this clause (iv) and including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (civ), does not exceed an amount equal to exceed $2.5 million 5% of Total Assets at any the time outstandingof such incurrence;
(dv) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 hereof or clauses clause (aii), (b), (c), (diii) or (jiv) of this paragraph;
(evi) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be is expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
Notes and (1ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company thereof and (2B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company thereof shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evi);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred in the ordinary course of business for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by management and not for the terms purpose of this Indenture to be outstandingspeculation;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(kviii) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (kviii), and the issuance of preferred stock by Unrestricted Subsidiaries;
(ix) the incurrence of Indebtedness solely in respect of performance, surety and similar bonds or completion or performance guarantees (including, without limitation, performance guarantees pursuant to coal supply agreements or equipment leases and including letters of credit issued in support of such performance, surety and similar bonds), to the extent that such incurrence does not result in the incurrence of any obligation for the payment of borrowed money to others;
(x) the incurrence of Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary; provided, however, that (i) such Indebtedness is not reflected on the balance sheet of the Company or any Restricted Subsidiary (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet shall not be deemed to be reflected on such balance sheet for purposes of this clause (i)) and (ii) the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including noncash proceeds (the fair market value of such noncash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Company and its Restricted Subsidiaries in connection with such disposition; and
(xi) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (xi), not to exceed the greater of (i)(x) $25.0 million and (y) 1% of Total Assets if incurred on or prior to December 15, 2000 or (ii) (x) $50.0 million and (y) 2% of Total Assets if incurred thereafter. The Company shall not incur incur, and shall not permit its Restricted Subsidiaries to incur, any Indebtedness (including Permitted DebtIndebtedness) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Restricted Subsidiary unless such Indebtedness is also contractually subordinated in right of payment to the Notes or the Subsidiary Guarantees, as the case may be, on substantially identical terms; provided, however, that no Indebtedness of the Company or any Restricted Subsidiary shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or any Restricted Subsidiary solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxi) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.09covenant, the Company shall be permitted to shall, in its sole discretion, classify or reclassify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09covenant. Accrual of interest, accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock, shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued.
Appears in 1 contract
Samples: Indenture (Appalachian Realty Co)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company Corporation shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Corporation shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; , provided, however, that the Company Corporation or any of its Restricted Subsidiaries may incur Subordinated Indebtedness (including or Acquired Debt) Debt or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Subordinated Indebtedness or Acquired Debt or issue preferred stock, if the Fixed Charge Coverage Consolidated Total Debt to Consolidated EBITDA Ratio for the CompanyCorporation's most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Subordinated Indebtedness or Acquired Debt is incurred or such Disqualified Stock or such preferred stock is issued issued, as the case may be, would not have been at least greater than 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Subordinated Indebtedness or Acquired Debt had been incurred or the Disqualified Stock or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period; provided further, that, notwithstanding Section 5.19, any Restricted Subsidiary that ceases to be a Wholly-Owned Subsidiary of the Corporation as a result of such Restricted Subsidiary issuing Capital Stock pursuant to this Section 5.7 shall be deemed to remain a Restricted Subsidiary for all purposes under this Indenture. The first paragraph of this Section 4.09 5.7 shall not prohibit the incurrence of any of the following items of Indebtedness or the issuance of any of the following Disqualified Stock (collectively, "Permitted Debt"):
(a1) the incurrence by the Company Corporation or any of its Restricted Subsidiaries and the guarantee thereof by any of the Guarantors of Indebtedness and letters of credit (and reimbursement obligations with respect thereto) under one or more Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (1), $50 million, provided that the aggregate principal amount of Indebtedness permitted to be incurred by the Corporation at any time pursuant to this clause (1) shall be decreased by the principal amount of Indebtedness then incurred by the Corporation pursuant to clauses (3) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the Existing Indebtednessdefinition of "Permitted Liens") of this paragraph;
(b2) the incurrence by the Company Corporation or any Restricted Subsidiary of Existing Indebtedness (other than Indebtedness permitted under clauses (4), (6), (10), (16) and (17));
(3) Indebtedness incurred by a Receivables Entity in a Qualified Receivables Transaction, provided that, after giving effect to any such incurrence, the aggregate principal amount of Indebtedness at any one time outstanding under this clause (3) does not exceed, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (3), $50 million, provided further, that the aggregate principal amount of Indebtedness permitted to be incurred by any Receivables Entity at any time pursuant to this clause (3) shall be decreased by the principal amount of additional Indebtedness then incurred by the Corporation pursuant to clauses (1) and (10) (to the extent that any Indebtedness incurred pursuant to such clause (10) is secured by a Permitted Lien pursuant to clause (3) of the definition of "Permitted Liens") of this paragraph;
(4) letters of credit and banker's acceptances issued in the ordinary course of business (and reimbursement obligations with respect thereto) in an aggregate principal amount (with letters of credit and banker's acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) not to exceed, as of any date of incurrence of Indebtedness pursuant to this clause (4), when combined with any Existing Indebtedness that comprises of letters of credit and banker's acceptances (with such letters of credit and banker's acceptances being deemed to have a principal amount equal to the maximum remaining potential liability of the Corporation and its Restricted Subsidiaries thereunder) and all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), $25 million;
(5) the incurrence by the Issuer, the Corporation and the other Guarantors of Indebtedness represented by the Notes, the Junior Notes related Note Guarantees, the Senior Subordinated Exchangeable Debentures and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelySenior Subordinated Exchangeable Debenture Guarantees;
(c6) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Attributable Debt in connection with a sale and leaseback transaction or Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, development, construction, installation, expansion, repair or improvement of property, plant or equipment used in the business of the Company Corporation or any of its Restricted Subsidiaries (in each case, whether through the direct purchase of such Restricted Subsidiaryassets or the purchase of Equity Interests of any Person owning such assets), in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (c6), not to exceed exceed, as of any date of incurrence of Indebtedness pursuant to this clause (6), $2.5 million at any time outstanding15 million;
(d7) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to extend, renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 5.7 or clauses (a2), (b), 5) and (c), (d) or (j7) of this paragraph;
(e) 8) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of intercompany Intercompany Indebtedness between or among the Company Corporation and any one or more of its Restricted Subsidiaries or between or among two or more Restricted Subsidiaries; , provided, however, that:
that (i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1a) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries and (2b) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries, shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Corporation or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e8);
(9) the issuance by any of the Corporation's Restricted Subsidiaries to the Corporation or to any of its Restricted Subsidiaries of shares of preferred stock, provided, however, that:
(a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Corporation or any of its Restricted Subsidiaries and
(b) any sale or other transfer of any such preferred stock to a Person that is not either the Corporation or any of its Restricted Subsidiaries shall be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (9);
(f10) the incurrence by the Company Corporation or any of its Restricted Subsidiaries of Cash Management Obligations and Hedging Obligations that are incurred for in the purpose ordinary course of fixing or hedging interest rate risk with respect business in an aggregate principal amount not to exceed $25 million at any floating rate Indebtedness that is permitted by the terms of this Indenture to be one time outstanding;
(g11) the Guarantee guarantee by the Company Issuer, the Corporation or any of the other Guarantors of Indebtedness of the Company Corporation or a any of its Restricted Subsidiary of the Company Subsidiaries that was permitted to be incurred by another provision of this Section 4.095.7, provided that if the Indebtedness being guaranteed is subordinated to the Notes, then the Guarantee must be subordinated to the same extent as the Indebtedness guaranteed;
(h12) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness in respect of workers' compensation claims, unemployment or other insurance or self-insurance obligations, bankers' acceptances, performance, completion and surety bonds, completion guarantees and similar obligations in the ordinary course of business;
(13) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a cheque, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(14) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Corporation or such Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn outs or similar obligations, in each case, incurred or assumed in connection with the acquisition, sale or disposition of any business or assets, or Capital Stock of the Corporation or any of its Subsidiaries, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Capital Stock;
(15) the incurrence of contingent liabilities arising out of endorsements of cheques and other negotiable instruments for deposit or collection in the ordinary course of business;
(16) the incurrence of Indebtedness, consisting of guarantees of loans or other extensions of credit to or on behalf of current or former officers, directors, employees and consultants (and their spouses and estates) of the Corporation or any of its Restricted Subsidiaries for the purpose of permitting such Persons to purchase or redeem Capital Stock of the Corporation or any of its Restricted Subsidiaries or in connection with the exercise by such Persons of stock options of the Corporation or any of its Restricted Subsidiaries and the funding of the exercise price of such stock options, in an aggregate principal amount not to exceed $2 million at any one time outstanding;
(17) Indebtedness of the Corporation or any of its Restricted Subsidiaries to credit card providers, processors or intermediaries in connection with credit card processing or financing services incurred in the ordinary course of business of the Corporation and its Restricted Subsidiaries in an aggregate principal amount not to exceed $25 million;
(18) the incurrence by the Corporation or any of its Restricted Subsidiaries of Indebtedness owed to one or more Persons in respect of premium financing or similar deferred payment obligations with respect to insurance policies purchased in the ordinary course of business; and
(19) the incurrence by the Corporation or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any one time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (19), not to exceed $40 million. The Issuer shall not incur, and shall not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Issuer or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms, provided, however, that no Indebtedness shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Issuer or a Guarantor solely by virtue of being unsecured or by virtue of being secured on a junior priority basis. For purposes of determining compliance with this Section 5.7, in the event that an item of proposed Indebtedness or Disqualified Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (19) of this Section 5.7, or is entitled to be incurred pursuant to the first paragraph of this Section 5.7, the Corporation shall be permitted to classify all or a portion of such item of Indebtedness or Disqualified Stock on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness or Disqualified Stock, in any manner that complies with this Section 5.7. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; 5.7, provided, in each such case, that the amount thereof of any such accrual, accretion or payment is included in Fixed Charges Consolidated Total Debt of the Company Corporation as accrued;
(i) . Notwithstanding any other provision of this Section 5.7, the maximum amount of Indebtedness of that the Company Corporation or any Restricted Subsidiary may incur pursuant to the extent that the Net Proceeds thereof are promptly:
(i) used this Section 5.7 shall not be deemed to purchase Notes tendered in an offer to purchase made be exceeded solely as a result of a Change fluctuations in Control, orexchange rates or currency values. The amount of any Indebtedness outstanding as of any date shall be:
(ii1) deposited to defease the Notes pursuant to Article 8 hereof.accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(j2) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted valueof the Indebtedness, as applicable) at in the case of any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(k3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the incurrence by Fair Market Value of such assets at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(b) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 1 contract
Samples: Trust Indenture
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company Parent shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwiseotherwise (collectively, “incur”), with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and the Company Parent shall not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that that, any Guarantor (other than the Company Parent) may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, that is expressly subordinated to both the Notes and the Company's Subsidiaries may incur Indebtedness or issue preferred stockSenior Secured Notes, if (i) the Fixed Charge Coverage Ratio for the Company's Parent’s most recently ended four full fiscal quarters for which internal publicly available financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued issued, as the case may be, would have been at least 2.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional such Indebtedness had been incurred or the Disqualified Stock or preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-fiscal quarter period and (ii) if the Consolidated Leverage Ratio for the Parent’s most recently ended four full fiscal quarters for which publicly available financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such preferred stock is issued, as the case may be, would have been equal to or less than 4.0 to 1.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if such Indebtedness had been incurred or the Disqualified Stock or the preferred stock had been issued, as the case may be, at the beginning of such four-fiscal quarter period. The first paragraph of this .
(b) Section 4.09 4.3(a) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(i) the incurrence by any of the Parent’s Restricted Subsidiaries of Indebtedness under or in the form of Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (i) not to exceed the greater of (x) the sum of (a) $100 million and (b) the aggregate amount of Indebtedness outstanding under any Credit Facilities in existence on March 8, 2013, and (y) the Borrowing Base of the Parent and its Restricted Subsidiaries on a consolidated basis; provided that the total Indebtedness incurred under this clause (i) by Restricted Subsidiaries that on the date of such incurrence are not Guarantors shall not exceed $50.0 million at any time;
(ii) Existing Indebtedness (other than Indebtedness described in clauses (i) and (iii) of this Section 4.3(b));
(iii) (A) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company Issuer and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees thereof to be issued on the Issue Date and (B) the incurrence by the Issuer and the Guarantors of Indebtedness represented by the Senior Secured Notes and the Senior Secured Notes Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyIssue Date;
(civ) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction design, construction, installation, lease, repair or improvement of property, plant or equipment used in the business of the Company Parent or any of its Restricted Subsidiaries, whether through the direct ownership, lease or purchase of assets or the purchase or ownership of ordinary shares of any Person owning such Restricted Subsidiary, assets (including any Indebtedness deemed to be incurred in connection with such purchase) in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 25.0 million at any time outstanding;
(dv) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany IndebtednessIndebtedness between or among the Parent and a Restricted Subsidiary (provided that the Intercompany Loans may be refunded or refinanced to the extent required in connection with any permitted refinancing of the Notes or the Senior Secured Notes)) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 4.3(a) or clauses (aii), (biii), (c), (dv) or (jvi);
(vi) Indebtedness of a Person incurred and outstanding on the date on which such Person becomes a Restricted Subsidiary of the Parent or any of its Restricted Subsidiaries or is merged, consolidated, amalgamated or otherwise combined with, or all or substantially all of its assets are transferred to, the Parent or any of its Restricted Subsidiaries (other than Indebtedness incurred in contemplation of, or in connection with, the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary of or was otherwise acquired by the Parent or a Restricted Subsidiary of the Parent); provided, however, that either (a) the aggregate principal amount (or accreted value, as applicable) of such Indebtedness, when taken together with all other Indebtedness of the Parent and any Restricted Subsidiaries incurred pursuant to clause (a) of this paragraphproviso to clause (vi) and outstanding on the date of such incurrence, does not exceed $50.0 million or (b) on the date that such Person is acquired by the Parent or a Restricted Subsidiary or merged, consolidated, amalgamated or otherwise combined with the Parent or any of its Restricted Subsidiaries, the Parent would have been able to incur $1.00 of additional Indebtedness pursuant to Section 4.3(a) after giving effect to the incurrence of such Indebtedness pursuant to this clause (vi) or the Fixed Charge Coverage Ratio improves;
(evii) the incurrence by the Company Parent or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company Parent and any of its Restricted Subsidiaries; provided, however, that:
(i1) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Issuer or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the CompanyIssuer, or its Note the Guarantee, in the case of a Guarantor; and
(12) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company Parent or a Restricted Subsidiary of the Company Parent and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company Parent or a Restricted Subsidiary of the Company shall Parent, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company Parent or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (evii);
(fviii) the issuance by any of the Parent’s Restricted Subsidiaries to the Parent or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(1) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Parent or a Restricted Subsidiary of the Parent; and
(2) any sale or other transfer of any such preferred stock to a Person that is not either the Parent or a Restricted Subsidiary of the Parent, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (viii);
(ix) the incurrence by the Company Parent or any of its Restricted Subsidiaries of Hedging Obligations that are not entered into for speculative purposes;
(x) any guarantee of the Notes or of Indebtedness permitted to be incurred under this Indenture;
(xi) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances, performance bonds, completion guarantees and warranties and surety bonds in the ordinary course of business (including guarantees or indemnities related thereto);
(xii) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(xiii) Indebtedness of the Parent or any of its Restricted Subsidiaries consisting of advance or extended payment terms in the ordinary course of business;
(xiv) Indebtedness of the Parent or any of its Restricted Subsidiaries constituting reimbursement obligations with respect to bank or insurance company bonds or guarantees and VAT guarantees issued in the ordinary course of business; provided, however, that, upon valid demand being made under such reimbursement obligations, such demands are satisfied within 90 days of the date of such demand;
(xv) Indebtedness of the Parent or any of its Restricted Subsidiaries owed on a short-term basis to banks or other financial institutions (including overdraft facilities) incurred in the ordinary course of business of the Parent and its Restricted Subsidiaries maintained with such banks or financial institutions and which arises in connection with ordinary banking arrangements to manage cash balances of the Parent and its Restricted Subsidiaries;
(xvi) customer deposits and advance payments received in the ordinary course of business from customers for goods purchased in the ordinary course of business;
(xvii) the incurrence by the Parent or any of its Restricted Subsidiaries of Indebtedness arising from agreements of the Parent or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Capital Stock of a Restricted Subsidiary, other than guarantees of Indebtedness of the Restricted Subsidiary disposed of, or incurred or assumed by any Person acquiring all or any portion of such business, assets or Capital Stock for the purpose of fixing or hedging interest rate risk with financing such acquisition; provided that the maximum liability of the Parent and its Restricted Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including the Fair Market Value of non-cash proceeds (measured at the time received and without giving effect to any floating rate Indebtedness that is permitted subsequent changes in value) actually received by the terms of this Indenture to be outstandingParent and its Restricted Subsidiaries in connection with such disposition;
(gxviii) Indebtedness of the Issuer or any Restricted Subsidiary consisting of (i) the Guarantee financing of insurance premiums or (ii) take-or-pay obligations contained in supply arrangements, in each case, in the ordinary course of business;
(xix) the incurrence by the Company Parent or any of the Guarantors its Restricted Subsidiaries of Indebtedness not otherwise permitted to have been incurred under this Indenture in an aggregate principal amount (or accreted value, as applicable) which, when taken together with all other Indebtedness of the Company Parent and any Restricted Subsidiaries incurred pursuant to this clause (xix) and outstanding on the date of such incurrence, does not exceed $15.0 million at any time outstanding; and
(xx) the incurrence of Indebtedness represented by the issuance of PIK Notes. The Parent shall not incur, and shall not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Parent or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes or the applicable Guarantee; provided, however, that no Indebtedness shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Parent solely by virtue of being unsecured or by virtue of being secured on a junior or second Lien basis or by virtue of not being Guaranteed. For purposes of determining compliance with this Section 4.3, in the event that an item or portion of an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (i) through (xix) above, or is entitled to be incurred pursuant to Section 4.3(a), the Issuer, the Parent and any Restricted Subsidiary of the Company that was Parent shall be permitted to be incurred by another provision classify such item or portion of an item of Indebtedness on the date of its incurrence, and later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09;
4.3, except that all Indebtedness outstanding on the Issue Date under any Credit Facilities shall be deemed initially incurred under clause (hi) the of Section 4.3(b). The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same termsterms (including any payment-in-kind interest on the Notes), the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.shall
Appears in 1 contract
Samples: Indenture (Latchey LTD)
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall not, not and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for Leverage Ratio, as of the Company's most recently ended four full fiscal quarters 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 Calculation Date, would have been at least 2.0 no greater than 3.50 to 1, 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 the preferred stock or Disqualified Stock had been issued, as the case may be, at as of the beginning Calculation Date.
(b) The provisions of such four-quarter period. The first paragraph of this Section 4.09 4.09(a) hereof shall not prohibit prohibit, so long as no Default or Event of Default has occurred and is continuing, the incurrence of any of the following items of Indebtedness (collectively, "“Permitted Debt"”):
(ai) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(bii) the incurrence by (x) the Company and the Guarantors of Indebtedness represented by the Notes (other than Additional Notes, the Junior Notes ) and the related Subsidiary Guarantees Note Guarantees, and (y) the Company of Indebtedness represented by the Junior PIK Notes, in each case to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyhereof;
(ciii) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price (whether in an asset acquisition or acquisition of Equity Interests) or cost of construction design, construction, installation or improvement of property, plant or equipment used in the business Permitted Business of the Company or such any of its Restricted SubsidiarySubsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (ciii), not to exceed $2.5 million US$15,000,000 at any time outstanding;
(div) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 covenant or clauses (ai), (b), (c), (dii) or (jiii) of this paragraphSection 4.09(b);
(ev) the incurrence by the Company or any of its Wholly-Owned Restricted Subsidiaries of intercompany Intercompany Indebtedness between or among the Company and any of its Wholly-Owned Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations obligations with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
(B) (1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Wholly-Owned Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Wholly-Owned Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, not permitted by this clause (v); and
(C) such Indebtedness is otherwise incurred in accordance with Section 4.23 hereof.
(vi) the issuance by any of the Company’s Wholly-Owned Restricted Subsidiaries to the Company or to any of its Wholly-Owned Restricted Subsidiaries that is a Guarantor of shares of preferred stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Wholly-Owned Restricted Subsidiary of the Company that is a Guarantor;
(B) any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Wholly-Owned Restricted Subsidiary of the Company that is a Guarantor, and
(C) will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (evi);
(fvii) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing managing the Company’s (or hedging any Restricted Subsidiary’s) exposure to fluctuations in interest rate risk rates with respect to any floating rate Indebtedness that is permitted to be Incurred by the terms of Company pursuant to this Indenture to be outstandingor protecting the Company (or its Restricted Subsidiaries) against currency fluctuations in the ordinary course of business and not for speculative purposes;
(gviii) the Guarantee guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee shall be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(hix) the accrual incurrence by the Company or any of interest, the accretion or amortization its Restricted Subsidiaries of original issue discount, the payment Indebtedness constituting reimbursement obligations with respect to letters of interest on any Indebtedness credit issued in the form ordinary course of additional business in respect of workers’ compensation claims or self-insurance, or other Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed respect to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedreimbursement type obligations regarding workers’ compensation claims;
(ix) Indebtedness of the incurrence by the Company or any Restricted Subsidiary of Indebtedness consisting of performance and other similar bonds and reimbursement obligations Incurred by the Company or any Restricted Subsidiary securing the performance of contractual, franchise, concession or license obligations of the Company or a Restricted Subsidiary;
(xi) Attributable Debt with Respect to a Sale and Leaseback Transaction to the extent such Sale and Leaseback Transaction complies with the provisions under Section 4.20;
(xii) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business provided, however, that such Indebtedness is extinguished within five Business Days of incurrence;
(xiii) Indebtedness of the Net Proceeds Company, to the extent the net proceeds thereof in their entirety are promptly:
(i) used solely to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
of Control Offer or (ii) concurrently deposited to defease the Notes pursuant to as described under Article 8 XII hereof.;
(jxiv) Indebtedness consisting of (i) the financing of insurance premiums or (ii) take or pay obligations in supply agreements, in each case in the ordinary course of business; and
(xv) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness incurred pursuant to this clause (jxv), but excluding the indebtedness permitted by clauses (i) through (xiv), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k)US$20,000,000. The Company shall not incur incur, and shall not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (ai) through (kxv) above, above or is entitled to be incurred pursuant to the first paragraph of this Section 4.094.09(a) hereof, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, the reclassification of accounts payable as Indebtedness and the payment of dividends on Disqualified Stock or preferred stock of Restricted Subsidiaries in the form of additional shares of the same class of Disqualified Stock or preferred stock of Restricted Subsidiaries will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock or preferred stock of Restricted Subsidiaries for purposes of this Section 4.09; provided, in each such case, that the amount of any such accrual, accretion or payment is included in Consolidated Interest Expense of the Company as accrued. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be:
(A) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(B) the principal amount of the Indebtedness, in the case of any other Indebtedness; and
(C) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(1) the Fair Market Value of such assets at the date of determination; and
(2) the amount of the Indebtedness of the other Person. For purposes of determining compliance with any U.S. dollar denominated restriction on the incurrence of Indebtedness, the U.S. dollar equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate determined as the average daily observed currency exchange rates reported by the Federal Reserve Bank of New York for the trailing 30 calendar day period, including the date of incurrence, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness. The principal amount of any Indebtedness incurred to refinance other Indebtedness, if incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such refinancing indebtedness is denominated calculated based on the relevant currency exchange rates as calculated in the first sentence of this paragraph.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), ) and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified Stock, Stock and the Company's its Restricted Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 if either:
(i) the Consolidated Leverage Ratio is issued would have been at least 2.0 less than 5.5 to 1 (prior to December 1, determined on a pro forma basis 2001), or 5.0 to 1.0 (including a pro forma application subsequent to December 1, 2001); or
(ii) the Consolidated Capital Ratio is less than 2.5 to 1.0. Notwithstanding the foregoing, the provisions of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 shall set forth above will not prohibit apply to the incurrence of any of the following items of Indebtedness (collectively, "Permitted DebtIndebtedness"):
(a) the The incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, ;
(b) The incurrence by the Junior Notes and the related Subsidiary Guarantees to be issued on the date Company or any of this Indenture and the date its Restricted Subsidiaries of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyExisting Indebtedness;
(c) The incurrence of Indebtedness by the Company to any Restricted Subsidiary or Indebtedness of any Restricted Subsidiary to the Company or any other Restricted Subsidiary (but only for so long as such Indebtedness is held by the Company or such Restricted Subsidiary);
(d) The issuance by the Company of preferred stock to any Restricted Subsidiary or the issuance by any Restricted Subsidiary of preferred stock to the Company or any other Restricted Subsidiary (but only for so long as such preferred stock is held by the Company or such Restricted Subsidiary);
(e) The incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented pursuant to acquisitions of capacity made in the ordinary course of business;
(f) The incurrence by Capital Lease Obligations, mortgage financings the Company or purchase money obligations, in each case, any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of financing all fixing or hedging interest or foreign currency exchange rate risk with respect to any part floating rate Indebtedness that is permitted by the terms of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred this Indenture to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time be outstanding;
(dg) The incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness of a Restricted Subsidiary incurred and outstanding on the date on which such Restricted Subsidiary was acquired by the Company; provided, however, that at the time such Restricted Subsidiary is acquired by the Company (giving effect to such acquisition), the Company would have been able to incur $1.00 of additional Indebtedness pursuant to the immediately preceding paragraph;
(h) The incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 hereof or clauses (a), (b), (cg), (dh), (i), (k), (n) or (jo) of this paragraph;
(e) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Subsidiary, as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accrued;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the The incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) not otherwise permitted to be incurred pursuant to this paragraph in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (ji), not to exceed $5.0 50.0 million; and;
(kj) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an The incurrence of Indebtedness by a Receivables Entity in a Qualified Receivables Transaction, provided that the proceeds thereof are applied in accordance with Section 4.10 hereof.
(k) The incurrence by the Company or any Restricted Subsidiary of Purchase Money Indebtedness, provided that the amount of such Purchase Money Indebtedness does not exceed 100% of the cost of construction, installation, acquisition, lease, development, design, engineering, financing, testing, start-up, upgrade, completion or improvement of assets (together with related costs and expenses) used in the business of the Company or such Restricted Subsidiary;
(l) Letters of Credit that are cash collateralized;
(m) Letters of Credit in an aggregate principal amount equal to $200.0 million less the amount of outstanding Indebtedness under clause (n) of this paragraph;
(n) The incurrence by the Company or any of its Restricted Subsidiaries of revolving credit Indebtedness in an aggregate amount not to exceed $200.0 million at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (n); and
(o) The guarantee by the Company or any Restricted Subsidiary of Indebtedness of the Company or any Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph by another clause of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
Incurrence of Indebtedness and Issuance of Preferred Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") incur any Indebtedness (including Acquired Debt), and the Company shall will not issue any Disqualified Stock and shall will not permit any of its Restricted Subsidiaries to issue any shares of preferred stockPreferred Stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Company's Subsidiaries any Guarantor may incur Indebtedness (including Acquired Debt) or issue preferred stockPreferred Stock, if the Fixed Charge Coverage Consolidated Leverage Ratio for of the Company's most recently ended four full fiscal quarters 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 , would have been at least 2.0 no more than 1.0 to 11.0, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom)) after giving effect to such incurrence; provided, as if further, that, with respect to any incurrence under this Section 4.09(a) after the additional Indebtedness had been incurred or Issue Date, the preferred stock or Disqualified Stock had been issued, as Company shall have delivered to the case may be, at Trustee an Officer’s Certificate signed by the beginning chief financial officer of such four-quarter period. The first paragraph the Company certifying that the requirements of this Section 4.09 4.09(a) have been complied with (including reasonably detailed calculations thereof) in connection with any such incurrence or issuance. Upon (i) the request of any Holder of 10% or more of the outstanding principal amount of the Notes (which request shall be in writing) and (ii) delivery by such Holder to the Trustee and the Company of a certificate in form and substance substantially the same as Exhibit E attached hereto, the Trustee shall deliver a copy of such Officer’s Certificate to such Holder.
(b) Section 4.09(a) will not prohibit the incurrence of any of the following items of Indebtedness or issuances of Disqualified Stock or Preferred Stock, as applicable (collectively, "“Permitted Debt"”):
(a1) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;
(b2) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture Issue Date and the date of the Junior related Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectivelyGuarantees;
(c3) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Restricted Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (c), not to exceed $2.5 million at any time outstanding;
(da) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance refinance, replace, defease or replace discharge any Indebtedness (other than intercompany Indebtedness) of the Company or any of its Restricted Subsidiaries or any Disqualified Stock of the Company or any Preferred Stock of a Restricted Subsidiary, in each case that was permitted by this Indenture to be incurred under the first paragraph Section 4.09(a) or clauses (1), (2) or (3) of this Section 4.09 or clauses (a), 4.09(b) and (b)) Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance, defease or discharge any Senior Debt of the Company or any of its Restricted Subsidiaries provided that the aggregate principal amount of such Indebtedness does not exceed the sum of (c)i) the outstanding principal amount of such Senior Debt (including any Reserved Indebtedness Amount) and (ii) an amount necessary to pay any fees and expenses, (d) including any premiums, related to such renewal, refunding, refinancing, defeasance or (j) of this paragraphdischarge;
(e4) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries; provided, however, that:
(iA) if the Company or any Guarantor is the obligor on such IndebtednessIndebtedness and the payee is not the Company or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the Notes, in the case of the Company, or its the Note Guarantee, in the case of a Guarantor; and
(1B) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall Company, will be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (e4);
(f5) the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of any Preferred Stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that results in any such Preferred Stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such Preferred Stock to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, in each case, to constitute an issuance of such Preferred Stock by such Restricted Subsidiary that was not permitted by this clause (5);
(6) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to be outstandingObligations;
(g7) the Guarantee by the Company or any of the Guarantors its Restricted Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of the Company to the extent that the guaranteed Indebtedness was permitted to be incurred by another provision of this Section 4.09; provided that if the Indebtedness being guaranteed is subordinated to or pari passu with the Notes, then the Guarantee must be subordinated or pari passu, as applicable, to the same extent as the Indebtedness guaranteed;
(h8) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of self-insurance obligations or bid, plugging and abandonment, appeal, reimbursement, performance, surety and similar bonds and completion guarantees provided by the Company or a Restricted Subsidiary in the ordinary course of business or consistent with industry practice or past practice and any Guarantees or letters of credit functioning as or supporting any of the foregoing bonds or obligations and workers’ compensation claims in the ordinary course of business or consistent with industry practice or past practice;
(9) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within five Business Days;
(10) the incurrence by the Company or any of its Restricted Subsidiaries of in-kind obligations relating to net oil, natural gas liquid or natural gas balancing positions arising in the ordinary course of business;
(11) any obligation arising from agreements of the Company or any Restricted Subsidiary of the Company providing for indemnification, adjustment of purchase price, earn outs, or similar obligations, in each case, incurred or assumed in connection with the disposition or acquisition of any business, assets or Capital Stock of a Restricted Subsidiary in a transaction permitted by this Indenture; and
(12) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness, the issuance by the Company of any Disqualified Stock or the issuance by any Restricted Subsidiary of Preferred Stock in an aggregate principal amount (or accreted value, as applicable) or liquidation preference at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred or Disqualified Stock or Preferred Stock issued pursuant to this clause (12), not to exceed, at any one time outstanding, $50.0 million. For purposes of determining compliance with this Section 4.09, in the event that an item of Indebtedness, Disqualified Stock or Preferred Stock meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (12) above, or is entitled to be incurred or issued pursuant to Section 4.09(a), the Company will be permitted to divide, classify and reclassify such item of Indebtedness, Disqualified Stock or Preferred Stock on the date of its incurrence or issuance, or later redivide or reclassify all or a portion of such item of Indebtedness, Disqualified Stock or Preferred Stock, in any manner that complies with this Section 4.09. Commitments in respect of the Credit Agreement in effect on the date on which Notes are first issued and authenticated under this Indenture will initially be deemed to have been incurred on such date in reliance upon the proviso to the first paragraph of the definition of Consolidated Leverage Ratio until such commitments are no longer outstanding or until the Company revokes an election of a Reserved Indebtedness Amount with respect to such commitments. The accrual of interestinterest or Preferred Stock or Disqualified Stock dividends or distributions, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of Preferred Stock or Disqualified Stock as Indebtedness due to a change in accounting principles, and the payment of dividends or distributions on Preferred Stock or Disqualified Stock in the form of additional shares securities of the same class of Preferred Stock or Disqualified Stock shall will not be deemed to be an incurrence of Indebtedness or an issuance of Preferred Stock or Disqualified Stock for purposes of this Section 4.09; provided. The amount of any Indebtedness outstanding as of any date will be:
(a) the accreted value of the Indebtedness, in each such case, that the amount thereof is included in Fixed Charges case of the Company as accruedany Indebtedness issued with original issue discount;
(ib) Indebtedness the principal amount of the Company or Indebtedness, in the case of any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 millionother Indebtedness; and
(kc) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(1) the incurrence by Fair Market Value of such assets at the Company's Unrestricted Subsidiaries date of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary determination; and
(2) the amount of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09Person.
Appears in 1 contract
Samples: Indenture (HighPeak Energy, Inc.)
Incurrence of Indebtedness and Issuance of Preferred Stock. The Company (a) Each of the Borrower and the Guarantor shall not, and the Guarantor shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "“incur"”) any Indebtedness (including Acquired Debt)Indebtedness, and the Company Guarantor shall not issue any Disqualified Stock and shall not permit any Stock.
(b) The provisions of its Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired DebtSection 6.02(a) or issue Disqualified Stock, and the Company's Subsidiaries may incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio for the Company's most recently ended four full fiscal quarters 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 would have been at least 2.0 to 1, 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 preferred stock or Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this Section 4.09 hereof shall not prohibit the incurrence of any of the following items of Indebtedness by (x) the Guarantor or any Restricted Subsidiary with respect to the Indebtedness set forth in subclauses (i) through (xxiii), inclusive, below or (y) the Borrower with respect to the Indebtedness set forth in subclauses (i) and (xxiv) through (xxvi), 83 inclusive, below (as applicable to the Guarantor, the Borrower or such Restricted Subsidiary, collectively, "“Permitted Debt"”):
(ai) the incurrence by the Company Borrower and the Guarantors of the Loans and Guarantees in the maximum aggregate principal amount provided for herein and any Permitted Refinancing Indebtedness that is incurred to renew, refund, refinance, replace, defease, extend or discharge any Indebtedness incurred pursuant to this clause (i); (ii) the incurrence by the Guarantor or any of its Restricted Subsidiaries of the Existing Indebtedness;
; (biii) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes, the Junior Notes and the related Subsidiary Guarantees to be issued on the date of this Indenture and the date of the Junior Note Indenture, respectively, or pursuant to Section 4.21 of this Indenture or Section 4.21 of the Junior Note Indenture, respectively;
(c) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, obligations incurred for to finance (or to reimburse the purpose Guarantor or any of financing its Restricted Subsidiaries for) all or any part of the purchase price or cost of construction installation or improvement of property, plant or equipment any Aircraft Asset used in the business of the Company Guarantor or any of its Restricted Subsidiaries or leased by third parties, which Indebtedness is incurred within one (1) year from the date of such purchase or installation or improvement unless otherwise permitted by clause (xxv) hereof; provided that no junior liens shall be permitted on any such aircraft or aircraft engines unless otherwise permitted by clause (xxv) hereof; (iv) the incurrence by the Guarantor or any of its Restricted Subsidiary, Subsidiaries of additional Indebtedness in an aggregate consolidated (i.e. without duplication) principal amountamount (or accreted value, as applicable), including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance refinance, replace, extend, defease or replace discharge any Indebtedness incurred pursuant to this clause (civ), not to exceed $2.5 million […***…], at any time outstanding;
; provided that no more than […***…] of such aggregate principal amount shall constitute secured Indebtedness; (dv) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange forany new secured Indebtedness, so long as (A) no Event of Default shall have occurred and be continuing or the net proceeds of which are used would result from giving effect to refundsuch secured Indebtedness, refinance or replace Indebtedness and (other than intercompany B) if, after giving effect to such secured Indebtedness) that was permitted by this Indenture to be incurred under the first paragraph of this Section 4.09 or clauses (a), (b), (c), (dx) the First Lien Leverage Ratio would be no greater than […***…] or (jy) the First Lien Leverage Ratio would be greater than […***…], then the aggregate initial outstanding amount of this paragraph;
such new Secured Indebtedness that would cause the First Lien Leverage Ratio to exceed […***…] shall not exceed […***…]; (evi) the incurrence by the Company Guarantor or any of its Restricted Subsidiaries of intercompany additional Indebtedness between that is secured by a junior Lien on the TLB Collateral (whether or among not the Company Term Loan B Facility remains outstanding) and any of its Restricted Subsidiaries; provided, however, that:
(i) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly contractually subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or its Note Guarantee, in the case of a Guarantor; and
(1) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company and (2) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an incurrence of such Indebtedness secured by the Company or such SubsidiaryTLB Collateral, so long as the case may be, that was not permitted by this clause (e);
(f) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of this Indenture to Secured Leverage Ratio would be outstanding;
(g) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be incurred by another provision of this Section 4.09;
(h) the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of no greater than […***…] after such additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided, in each such case, that the amount thereof is included in Fixed Charges of the Company as accruedincurred;
(i) Indebtedness of the Company or any Restricted Subsidiary to the extent that the Net Proceeds thereof are promptly:
(i) used to purchase Notes tendered in an offer to purchase made as a result of a Change in Control, or
(ii) deposited to defease the Notes pursuant to Article 8 hereof.
(j) the incurrence by the Company or any of its Restricted Subsidiaries of additional Indebtedness (including Acquired Debt) in an aggregate principal amount (or accreted value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (j), not to exceed $5.0 million; and
(k) the incurrence by the Company's Unrestricted Subsidiaries of Non-Recourse Debt, provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event shall be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of the Company that was not permitted by this clause (k). The Company shall not incur any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of the Company unless such Indebtedness is also contractually subordinated in right of payment to the Notes on substantially identical terms; provided, however, that no Indebtedness of the Company shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company solely by virtue of being unsecured. For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (k) above, or is entitled to be incurred pursuant to the first paragraph of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section 4.09.
Appears in 1 contract
