Exhibit 4.1
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XXXXX 0 XXXXXXXXXXXXXX, XXX.,
Issuer
to
IBJ XXXXXXXX BANK & TRUST COMPANY,
as Trustee
Indenture
Dated as of December 2, 1998
$833,815,000
10-1/2% Senior Discount Notes Due 2008
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TABLE OF CONTENTS
Page
RECITALS OF THE COMPANY....................................................1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions...................................................2
Accreted Value........................................................2
Acquired Debt.........................................................3
Act...................................................................3
Affiliate.............................................................3
Affiliate Transaction.................................................3
Agent Member..........................................................3
Asset Disposition.....................................................4
Attributable Value....................................................4
Board of Directors....................................................5
Board Resolution......................................................5
Business Day..........................................................5
Capital Lease Obligation..............................................5
Capital Stock.........................................................5
Cash Equivalents......................................................5
Change of Control.....................................................6
Change of Control Triggering Event....................................6
Code..................................................................6
Commission............................................................6
Common Stock..........................................................7
Company...............................................................7
Company Order.........................................................7
Consolidated Capital Ratio............................................7
Consolidated Cash Flow Available for Fixed Charges....................8
Consolidated Income Tax Expense.......................................8
Consolidated Interest Expense.........................................8
Consolidated Net Income...............................................9
Consolidated Net Worth................................................9
Consolidated Tangible Assets..........................................9
Corporate Trust Office...............................................10
Credit Facilities....................................................10
Debt.................................................................10
Default..............................................................11
Defaulted Interest...................................................11
Depository...........................................................11
Designation..........................................................11
Disqualified Stock...................................................11
Disqualified Stock Dividends.........................................11
Eligible Receivables.................................................12
Event of Default.....................................................12
Exchange Act.........................................................12
Exchange Securities..................................................12
Excess Proceeds......................................................12
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Expiration Date......................................................12
Fair Market Value....................................................12
Federal Bankruptcy Code..............................................12
Global Security......................................................12
Government Securities................................................12
Guarantee............................................................12
Guarantor............................................................13
Holder...............................................................13
Incur................................................................13
Indenture............................................................13
Initial Foreign Purchaser............................................14
Initial Purchasers...................................................14
Initial Securities...................................................14
Institutional Accredited Investor....................................14
Institutional Accredited Investor Global Security....................14
Interest Payment Date................................................14
Interest Rate or Currency Protection Agreement.......................14
Invested Capital.....................................................14
Investment...........................................................14
Issue Date...........................................................15
Issue Date Rating....................................................15
Joint Venture........................................................15
Lien.................................................................15
Maturity.............................................................15
Measurement Date.....................................................15
Xxxxx'x..............................................................16
Net Available Proceeds...............................................16
9-1/8% Senior Notes..................................................17
9-1/8% Senior Notes Indenture........................................17
Non-Global Purchasers................................................17
Offer................................................................17
Offer to Purchase....................................................17
Officers' Certificate................................................19
Opinion of Counsel...................................................19
OECD.................................................................19
Outstanding..........................................................19
Paying Agent.........................................................20
Permitted Holders....................................................20
Permitted Interest Rate or Currency Protection Agreement.............21
Permitted Investments................................................21
Permitted Liens......................................................21
Permitted Telecommunications Capital Asset Disposition...............22
Person...............................................................22
Physical Security....................................................22
Predecessor Security.................................................22
Preferred Stock......................................................22
Preferred Stock Dividends............................................23
Private Exchange Offer...............................................23
Private Exchange Securities..........................................23
Private Placement Legend.............................................23
Property.............................................................23
Proportionate Interest...............................................23
Purchase Amount......................................................23
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Purchase Date........................................................23
Purchase Money Debt..................................................23
Purchase Price.......................................................24
Qualified Institutional Buyer........................................24
Qualified Receivable Facility........................................24
Rating Agencies......................................................24
Rating Date..........................................................24
Rating Decline.......................................................24
Receivables..........................................................24
Redemption Date......................................................24
Redemption Price.....................................................25
Refinancing..........................................................25
Registered Exchange Offer............................................25
Registration Agreement...............................................25
Registration Default.................................................25
Regular Record Date..................................................25
Regulation S.........................................................25
Regulation S Global Security.........................................25
Required Filing Dates................................................25
Responsible Officer..................................................25
Restricted Payment...................................................25
Restricted Subsidiary................................................25
Restricted Subsidiary Guarantee......................................26
Revocation...........................................................26
Rule 144A............................................................26
Rule 144A Global Security............................................26
S&P..................................................................26
Sale and Leaseback Transaction.......................................26
Securities...........................................................26
Securities Act.......................................................26
Security Register....................................................26
Shelf Registration Statement.........................................26
Significant Subsidiary...............................................27
Special Assets.......................................................27
Special Interest.....................................................27
Special Record Date..................................................27
Stated Maturity......................................................27
Subordinated Debt....................................................27
Subsidiary...........................................................28
Telecommunications/IS Assets.........................................28
Telecommunications/IS Business.......................................29
Trust Indenture Act..................................................29
Trustee..............................................................29
Unrestricted Subsidiary..............................................29
Vice President.......................................................29
Voting Stock.........................................................29
Wholly Owned Subsidiary..............................................30
SECTION 102. Compliance Certificates and Opinions.........................30
SECTION 103. Form of Documents Delivered to Trustee.......................30
SECTION 104. Acts of Holders..............................................31
SECTION 105. Notices, etc., to Trustee and Company........................32
SECTION 106. Notice to Holders; Waiver....................................33
SECTION 107. Effect of Headings and Table of Contents.....................33
SECTION 108. Successors and Assigns.......................................34
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SECTION 109. Separability Clause..........................................34
SECTION 110. Benefits of Indenture........................................34
SECTION 111. Governing Law................................................34
SECTION 112. Conflict with Trust Indenture Act............................34
SECTION 113. Legal Holidays...............................................34
SECTION 114. No Personal Liability of Directors, Officers, Employees and
Stockholders...........................................35
SECTION 115. Independence of Covenants....................................35
SECTION 116. Exhibits.....................................................35
SECTION 117. Counterparts.................................................35
SECTION 118. Duplicate Originals..........................................35
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally..............................................36
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms..............................................36
SECTION 302. Denominations................................................37
SECTION 303. Execution, Authentication, Delivery and Dating...............37
SECTION 304. Temporary Securities.........................................40
SECTION 305. Registration, Registration of Transfer and Exchange..........40
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.............41
SECTION 307. Payment of Interest; Interest Rights Preserved...............42
SECTION 308. Persons Deemed Owners........................................44
SECTION 309. Cancellation.................................................44
SECTION 310. Computation of Interest......................................44
SECTION 311. CUSIP Number.................................................44
SECTION 312. Book-Entry Provisions for Global Securities..................45
SECTION 313. Special Transfer Provisions..................................47
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture......................52
SECTION 402. Application of Trust Money...................................53
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default............................................53
SECTION 502. Acceleration of Maturity; Rescission and Annulment...........55
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee................................................56
SECTION 504. Trustee May File Proofs of Claim.............................57
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SECTION 505. Trustee May Enforce Claims Without Possession of Securities..57
SECTION 506. Application of Money Collected...............................58
SECTION 507. Limitation on Suits..........................................58
SECTION 508. Unconditional Right of Holders to Receive Accreted Value,
Premium and Interest...................................59
SECTION 509. Restoration of Rights and Remedies...........................59
SECTION 510. Rights and Remedies Cumulative...............................59
SECTION 511. Delay or Omission Not Waiver.................................59
SECTION 512. Control by Holders...........................................60
SECTION 513. Waiver of Past Defaults......................................60
SECTION 514. Waiver of Stay or Extension Laws.............................60
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities..........................61
SECTION 602. Notice of Default............................................62
SECTION 603. Certain Rights of Trustee....................................63
SECTION 604. Trustee Not Responsible for Recitals or Issuance of
Securities.............................................64
SECTION 605. May Hold Securities..........................................64
SECTION 606. Money Held in Trust..........................................64
SECTION 607. Compensation and Reimbursement...............................64
SECTION 608. Corporate Trustee Required; Eligibility; Conflicting
Interests..............................................65
SECTION 609. Resignation and Removal; Appointment of Successor............66
SECTION 610. Acceptance of Appointment by Successor.......................67
SECTION 611. Merger, Conversion, Consolidation or Succession to Business..68
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders.................68
SECTION 702. Reports by Trustee...........................................69
SECTION 703. Reports by Company...........................................69
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, etc., Only on Certain Terms.........69
SECTION 802. Successor Company Substituted................................70
SECTION 803. Guarantor May Consolidate, etc., Only on Certain Terms.......71
SECTION 804. Successor Guarantor Substituted..............................72
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders...........73
SECTION 902. Supplemental Indentures With Consent of Holders..............74
SECTION 903. Execution of Supplemental Indentures.........................75
SECTION 904. Effect of Supplemental Indentures............................75
SECTION 905. Conformity with Trust Indenture Act..........................75
SECTION 906. Reference in Securities to Supplemental Indentures...........75
SECTION 907. Notice of Supplemental Indentures............................76
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Accreted Value, Premium, if any, and Interest....76
SECTION 1002. Maintenance of Office or Agency.............................76
SECTION 1003. Money for Security Payments to Be Held in Trust.............77
SECTION 1004. Corporate Existence.........................................78
SECTION 1005. Maintenance of Properties...................................78
SECTION 1006. Insurance...................................................79
SECTION 1007. Reports.....................................................79
SECTION 1008. Statement by Officers as to Default.........................79
SECTION 1009. Change of Control Triggering Event..........................80
SECTION 1010. Limitation on Consolidated Debt.............................82
SECTION 1011. Limitation on Debt of Restricted Subsidiaries...............86
SECTION 1012. Limitation on Restricted Payments...........................88
SECTION 1013. Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries........91
SECTION 1014. Limitation on Liens.........................................92
SECTION 1015. Limitation on Sale and Leaseback Transactions...............94
SECTION 1016. Limitation on Asset Dispositions............................94
SECTION 1017. Limitation on Issuance and Sales of Capital Stock of
Restricted Subsidiaries...............................96
SECTION 1018. Transactions with Affiliates................................97
SECTION 1019. Limitation on Designations of Unrestricted Subsidiaries.....99
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption........................................100
SECTION 1102. Applicability of Article...................................101
SECTION 1103. Election to Redeem; Notice to Trustee......................101
SECTION 1104. Selection by Trustee of Securities to Be Redeemed..........101
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SECTION 1105. Notice of Redemption.......................................102
SECTION 1106. Deposit of Redemption Price................................102
SECTION 1107. Securities Payable on Redemption Date......................103
SECTION 1108. Securities Redeemed in Part................................103
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. Company's Option to Effect Defeasance or Covenant
Defeasance...........................................103
SECTION 1202. Defeasance and Discharge...................................104
SECTION 1203. Covenant Defeasance........................................104
SECTION 1204. Conditions to Defeasance or Covenant Defeasance............105
SECTION 1205. Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions................106
SECTION 1206. Reinstatement..............................................107
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INDENTURE, dated as of December 2, 1998 between Level 3 Communications,
Inc., a corporation duly organized and existing under the laws of the State of
Delaware (herein called the "Company"), having its principal office at 0000
Xxxxxx Xxxxxx, Xxxxx, Xxxxxxxx 00000, and IBJ Xxxxxxxx Bank & Trust Company, a
New York banking corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of 10-1/2% Senior
Discount Notes Due 2008 (the "Initial Securities") and, if and when issued
pursuant to a Registered Exchange Offer or Private Exchange Offer pursuant to
the Registration Agreement for the Initial Securities, 10-1/2% Senior Discount
Notes Due 2008 (the "Exchange Securities" and, together with the Initial
Securities, the "Securities"), of substantially the tenor and amount hereinafter
set forth, and to provide therefor the Company has duly authorized the execution
and delivery of this Indenture.
All things necessary have been done to make the Securities, when executed
by the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company and to make this Indenture a valid
agreement of each of the Company and the Trustee, in accordance with their and
its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:
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ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions
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For all purposes of this Indenture, including the recitals set forth above,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article, and include the plural as well as the singular;
(b) all other terms used herein which are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and, except as otherwise herein expressly provided, the term "generally accepted
accounting principles" with respect to any computation required or permitted
hereunder shall mean United States generally accepted accounting principles as
in effect on the date of this Indenture;
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section, paragraph or other subdivision;
(e) unless otherwise indicated, references to Articles, Sections,
paragraphs or other subdivisions are references to such Articles, Sections,
paragraphs or other subdivisions of this Indenture; and
(f) "or" is not exclusive and "including" means including without
limitation.
"Accreted Value" of any Security as of or to any date of determination
prior to December 1, 2003, or of any other Debt issued at a price less than the
principal amount at stated maturity, means, as of any date of determination, an
amount equal to the sum of (a) the issue price of such Debt as determined in
accordance with Section 1273 of the Code or any successor provisions (which, in
the case of the Securities, will be $599.66 per $1,000 principal amount at
maturity of Securities) plus (b) the aggregate of the portions of the original
issue discount (the excess of the amounts considered as part of the "stated
redemption price at maturity" of such Debt within the meaning of Section
1273(a)(2) of the Code or any successor provisions, whether denominated as
principal or interest, over the issue price of such Debt) that shall theretofore
have accrued pursuant to Section 1272 of the Code (without regard to Section
1272(a)(7)
2
of the Code) from the date of issue of such Debt to the date of determination
(which amount, in the case of the Securities, shall be amortized on a daily
basis and compounded semiannually on each June 1 and December 1 at a rate of 10-
1/2% per annum from the Issue Date through the date of determination on the
basis of a 360-day year of twelve 30-day months), minus all amounts theretofore
paid in respect of such Debt, which amounts are considered as part of the
"stated redemption price at maturity" of such Debt within the meaning of Section
1273(a)(2) of the Code or any successor provisions (whether such amounts paid
were denominated principal or interest). The Accreted Value of any Securities on
or after December 1, 2003, will mean the principal amount at maturity of such
Security. Notwithstanding the foregoing, if the Company elects to commence the
accrual of cash interest on the Securities on or after December 1, 2001 and
prior to December 1, 2003, the Securities shall cease to accrete, and the
Accreted Value and the principal amount at maturity of such Security shall be
the Accreted Value on the date of commencement of such accrual as calculated in
accordance with the first sentence of this definition.
"Acquired Debt" means, with respect to any specified Person, (i) Debt of
any other Person existing at the time such Person merges with or into or
consolidates with or becomes a Subsidiary of such specified Person and (ii) Debt
secured by a Lien encumbering any Property acquired by such specified Person,
which Debt was not incurred in anticipation of, and was outstanding prior to,
such merger, consolidation or acquisition.
"Act", when used with respect to any Holder, has the meaning specified in
Section 104.
"Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. For purposes of
Sections 1016 and 1018 and the definition of "Telecommunications/IS Assets"
only, "Affiliate" shall also mean any beneficial owner of shares representing
10% or more of the total voting power of the Voting Stock (on a fully diluted
basis) of the Company or of rights or warrants to purchase such Voting Stock
(whether or not currently exercisable) and any Person who would be an Affiliate
of any such beneficial owner pursuant to the first sentence hereof.
"Affiliate Transaction" has the meaning specified in Section 1018.
"Agent Member" has the meaning specified in Section 312.
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"Asset Disposition" means any transfer, conveyance, sale, lease, issuance
or other disposition by the Company or any Restricted Subsidiary in one or more
related transactions (including a consolidation or merger or other sale of any
such Restricted Subsidiary with, into or to another Person in a transaction in
which such Restricted Subsidiary ceases to be a Restricted Subsidiary of the
Company, but excluding a disposition by a Restricted Subsidiary to the Company
or a Restricted Subsidiary or by the Company to a Restricted Subsidiary) of (i)
shares of Capital Stock or other ownership interests of a Restricted Subsidiary
(other than as permitted by clause (v), (vi), (vii) or (ix) of Section 1017),
(ii) substantially all of the assets of the Company or any Restricted Subsidiary
representing a division or line of business or (iii) other Property of the
Company or any Restricted Subsidiary outside of the ordinary course of business
(excluding any transfer, conveyance, sale, lease or other disposition of
equipment that is obsolete or no longer used by or useful to the Company,
provided that the Company has delivered to the Trustee an Officers' Certificate
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stating that such criteria are satisfied); provided in each case that the
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aggregate consideration for such transfer, conveyance, sale, lease or other
disposition is equal to $5,000,000 or more in any 12-month period. The following
shall not be Asset Dispositions: (i) Permitted Telecommunications Capital Asset
Dispositions that comply with clause (i) of the first paragraph of Section 1016,
(ii) when used with respect to the Company, any Asset Disposition permitted
pursuant to Article Eight which constitutes a disposition of all or
substantially all of the assets of the Company and the Restricted Subsidiaries
taken as a whole, (iii) Receivables sales constituting Debt under Qualified
Receivable Facilities permitted to be Incurred pursuant to Section 1010 and (iv)
any disposition that constitutes a Permitted Investment or a Restricted Payment
permitted by Section 1012.
"Attributable Value" means, as to any particular lease under which any
Person is at the time liable other than a Capital Lease Obligation, and at any
date as of which the amount thereof is to be determined, the total net amount of
rent required to be paid by such Person under such lease during the remaining
term thereof (including any period for which such lease has been extended) as
determined in accordance with generally accepted accounting principles,
discounted from the last date of such remaining term to the date of
determination at a rate per annum equal to the discount rate which would be
applicable to a Capital Lease Obligation with like term in accordance with
generally accepted accounting principles. The net amount of rent required to be
paid under any such lease for any such period shall be the aggregate amount of
rent payable by the lessee with respect to such period after excluding amounts
required to be paid on account of insurance, taxes, assessments, utility,
operating and labor costs and similar charges. In the case of any lease which is
terminable by the lessee upon the payment of penalty, such net amount shall also
include the lesser of the amount of such
4
penalty (in which case no rent shall be considered as required to be paid under
such lease subsequent to the first date upon which it may be so terminated) or
the rent which would otherwise be required to be paid if such lease is not so
terminated. "Attributable Value" means, as to a Capital Lease Obligation, the
principal amount thereof.
"Board of Directors" means the board of directors of the Company.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company to have been duly adopted by the Board
of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in The City of New York are
authorized or obligated by law or executive order to close.
"Capital Lease Obligation" of any Person means the obligation to pay rent
or other payment amount under a lease of (or other Debt arrangements conveying
the right to use) Property of such Person which is required to be classified and
accounted for as a capital lease or a liability on the face of a balance sheet
of such Person in accordance with generally accepted accounting principles (a
"Capital Lease"). The stated maturity of such obligation shall be the date of
the last payment of rent or any other amount due under such lease prior to the
first date upon which such lease may be terminated by the lessee without payment
of a penalty. The principal amount of such obligation shall be the capitalized
amount thereof that would appear on the face of a balance sheet of such Person
in accordance with generally accepted accounting principles.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person and any rights (other than debt securities convertible
or exchangeable into an equity interest), warrants or options to acquire an
equity interest in such Person.
"Cash Equivalents" means (i) Government Securities maturing, or subject to
tender at the option of the holder thereof, within two years after the date of
acquisition thereof, (ii) time deposits and certificates of deposit of any
commercial bank organized in the United States having capital and surplus in
excess of $500,000,000 or a commercial bank organized under the law of any other
country that is a member of the OECD having total assets in excess of
$500,000,000 (or its foreign currency equivalent at the time) with a maturity
date not more than one year from the date of acquisition, (iii) repurchase
obligations
5
with a term of not more than 30 days for underlying securities of the types
described in clause (i) above entered into with (x) any bank meeting the
qualifications specified in clause (ii) above or (y) any primary government
securities dealer reporting to the Market Reports Division of the Federal
Reserve Bank of New York, (iv) direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof maturing, or subject to tender at the option of
the holder thereof, within 90 days after the date of acquisition thereof,
provided that, at the time of acquisition, the long-term debt of such state,
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political subdivision or public instrumentality has a rating of A (or higher)
from S&P or A-2 (or higher) from Xxxxx'x (or, if at any time neither S&P nor
Xxxxx'x shall be rating such obligations, then an equivalent rating from such
other nationally recognized rating service acceptable to the Trustee), (v)
commercial paper issued by the parent corporation of any commercial bank
organized in the United States having capital and surplus in excess of
$500,000,000 or a commercial bank organized under the laws of any other country
that is a member of the OECD having total assets in excess of $500,000,000 (or
its foreign currency equivalent at the time), and commercial paper issued by
others having one of the two highest ratings obtainable from either S&P or
Xxxxx'x (or, if at any time neither S&P nor Xxxxx'x shall be rating such
obligations, then from such other nationally recognized rating service
acceptable to the Trustee) and in each case maturing within one year after the
date of acquisition, (vi) overnight bank deposits and bankers' acceptances at
any commercial bank organized in the United States having capital and surplus in
excess of $500,000,000 or a commercial bank organized under the laws of any
other country that is a member of the OECD having total assets in excess of
$500,000,000 (or its foreign currency equivalent at the time), (vii) deposits
available for withdrawal on demand with a commercial bank organized in the
United States having capital and surplus in excess of $500,000,000 or a
commercial bank organized under the laws of any other country that is a member
of the OECD having total assets in excess of $500,000,000 (or its foreign
currency equivalent at the time) and (viii) investments in money market funds
substantially all of whose assets comprise securities of the types described in
clauses (i) through (vii).
"Change of Control" has the meaning specified in Section 1009.
"Change of Control Triggering Event" has the meaning specified in Section
1009.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this Indenture such Commission is not existing and performing the
duties now assigned
6
to it under the Trust Indenture Act, then the body performing such duties at
such time.
"Common Stock" of any Person means Capital Stock of such Person that does
not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"Company" means the Person named as the "Company" in the first paragraph of
this Indenture, until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
"Company Order" or "Company Request" means a written request or order
signed in the name of the Company by the Chairman of the Board of Directors, a
Vice Chairman of the Board of Directors, the President or a Vice President, and
by the Chief Financial Officer, the Chief Accounting Officer, the Treasurer, an
Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary of
the Company and delivered to the Trustee.
"Consolidated Capital Ratio" means as of the date of determination the
ratio of (i) the aggregate amount of Debt of the Company and its Restricted
Subsidiaries on a consolidated basis as at the date of determination to (ii) the
sum of (a) $2,024,000,000, (b) the aggregate net proceeds to the Company from
the issuance or sale of any Capital Stock (including Preferred Stock) of the
Company other than Disqualified Stock subsequent to the Measurement Date, (c)
the aggregate net proceeds from the issuance or sale of Debt of the Company or
any Restricted Subsidiary subsequent to the Measurement Date convertible or
exchangeable into Capital Stock of the Company other than Disqualified Stock, in
each case upon conversion or exchange thereof into Capital Stock of the Company
subsequent to the Measurement Date and (d) the after-tax gain on the sale,
subsequent to the Measurement Date, of Special Assets to the extent such Special
Assets have been sold for cash, Cash Equivalents, Telecommunications/IS Assets
or the assumption of Debt of the Company or any Restricted Subsidiary (other
than Debt that is subordinated to the Securities or any applicable Restricted
Subsidiary Guarantee) and release of the Company and all Restricted Subsidiaries
from all liability on the Debt assumed; provided, however, that, for purposes of
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calculation of the Consolidated Capital Ratio, the net proceeds from the
issuance or sale of Capital Stock or Debt described in clause (b) or (c) above
shall not be included to the extent (x) such proceeds have been utilized to make
a Permitted Investment under clause (i) of the definition thereof or a
Restricted Payment or (y) such Capital Stock or Debt shall have been issued or
sold to the Company, a Subsidiary of the Company or an employee stock
7
ownership plan or trust established by the Company or any such Subsidiary for
the benefit of their employees.
"Consolidated Cash Flow Available for Fixed Charges" for any period means
the Consolidated Net Income of the Company and its Restricted Subsidiaries for
such period increased by the sum of, to the extent reducing Consolidated Net
Income for such period, (i) Consolidated Interest Expense of the Company and its
Restricted Subsidiaries for such period, plus (ii) Consolidated Income Tax
Expense of the Company and its Restricted Subsidiaries for such period, plus
(iii) consolidated depreciation and amortization expense and any other non-cash
items (other than any such non-cash item to the extent that it represents an
accrual of or reserve for cash expenditures in any future period); provided,
--------
however, that there shall be excluded therefrom the Consolidated Cash Flow
-------
Available for Fixed Charges (if positive) of any Restricted Subsidiary
(calculated separately for such Restricted Subsidiary in the same manner as
provided above for the Company) that is subject to a restriction which prevents
the payment of dividends or the making of distributions to the Company or
another Restricted Subsidiary to the extent of such restrictions.
"Consolidated Income Tax Expense" for any period means the aggregate
amounts of the provisions for income taxes of the Company and its Restricted
Subsidiaries for such period calculated on a consolidated basis in accordance
with generally accepted accounting principles.
"Consolidated Interest Expense" for any period means the interest expense
included in a consolidated income statement (excluding interest income) of the
Company and its Restricted Subsidiaries for such period in accordance with
generally accepted accounting principles, including without limitation or
duplication (or, to the extent not so included, with the addition of), (i) the
amortization of Debt discounts and issuance costs, including commitment fees;
(ii) any payments or fees with respect to letters of credit, bankers'
acceptances or similar facilities; (iii) net costs with respect to interest rate
swap or similar agreements or foreign currency hedge, exchange or similar
agreements (including fees); (iv) Preferred Stock Dividends (other than
dividends paid in shares of Preferred Stock that is not Disqualified Stock)
declared and paid or payable; (v) accrued Disqualified Stock Dividends, whether
or not declared or paid; (vi) interest on Debt guaranteed by the Company and its
Restricted Subsidiaries; (vii) the portion of any Capital Lease Obligation or
Sale and Leaseback Transaction paid during such period that is allocable to
interest expense; (viii) interest Incurred in connection with investments in
discontinued operations; and (ix) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest or fees to any Person (other than the Company
or a Restricted Subsidiary) in connection with Debt Incurred by such plan or
trust.
8
"Consolidated Net Income" for any period means the net income (or loss) of
the Company and its Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with generally accepted accounting principles;
provided that there shall be excluded therefrom (a) for purposes of Section 1012
only, the net income (or loss) of any Person acquired by the Company or a
Restricted Subsidiary in a pooling-of-interests transaction for any period prior
to the date of such transaction, (b) the net income (or loss) of any Person that
is not a Restricted Subsidiary except to the extent of the amount of dividends
or other distributions actually paid to the Company or a Restricted Subsidiary
by such Person during such period (except, for purposes of Section 1012 only, to
the extent such dividends or distributions have been subtracted from the
calculation of the amount of Investments to support the actual making of
Investments), (c) gains or losses realized upon the sale or other disposition of
any Property of the Company or its Restricted Subsidiaries that is not sold or
disposed of in the ordinary course of business (it being understood that
Permitted Telecommunications Capital Asset Dispositions shall be considered to
be in the ordinary course of business), (d) gains or losses realized upon the
sale or other disposition of any Special Assets, (e) all extraordinary gains and
extraordinary losses, determined in accordance with generally accepted
accounting principles, (f) the cumulative effect of changes in accounting
principles, (g) non-cash gains or losses resulting from fluctuations in currency
exchange rates, (h) any non-cash expense related to the issuance to employees or
directors of the Company or any Restricted Subsidiary of (1) options to purchase
Capital Stock of the Company or such Restricted Subsidiary or (2) other
compensatory rights; provided, in either case, that such options or rights, by
--------
their terms can be redeemed at the option of the holder of such option or right
only for Capital Stock, and (i) with respect to a Restricted Subsidiary that is
not a Wholly Owned Subsidiary any aggregate net income (or loss) in excess of
the Company's or any Restricted Subsidiary's pro rata share of the net income
(or loss) of such Restricted Subsidiary that is not a Wholly Owned Subsidiary;
provided further that there shall further be excluded therefrom the net income
----------------
(but not net loss) of any Restricted Subsidiary that is subject to a restriction
which prevents the payment of dividends or the making of distributions to the
Company or another Restricted Subsidiary to the extent of such restriction.
"Consolidated Net Worth" of any Person means the stockholders' equity of
such Person, determined on a consolidated basis in accordance with generally
accepted accounting principles, less amounts attributable to Disqualified Stock
of such Person.
"Consolidated Tangible Assets" of any Person means the total amount of
assets (less applicable reserves and other properly deductible items) which
under generally accepted accounting principles would be included on a
consolidated balance sheet of
9
such Person and its Subsidiaries after deducting therefrom all goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other like
intangibles, which in each case under generally accepted accounting principles
would be included on such consolidated balance sheet.
"Corporate Trust Office" means the principal corporate trust office of the
Trustee, at which at any particular time its corporate trust business shall be
administered, which office at the date of execution of this Indenture is located
at Xxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, except that, with respect to
presentation of Securities for payment or for registration of transfer or
exchange, such term shall mean the office or agency of the Trustee at which, at
any particular time, its corporate agency business shall be conducted.
"Credit Facilities" means one or more credit agreements, loan agreements or
similar facilities, secured or unsecured, providing for revolving credit loans,
term loans and/or letters of credit, including any Qualified Receivable
Facility, entered into from time to time by the Company and its Restricted
Subsidiaries, and including any related notes, Guarantees, collateral documents,
instruments and agreements executed in connection therewith, as the same may be
amended, supplemented, modified, restated or replaced from time to time.
"Debt" means (without duplication), with respect to any Person, whether
recourse is to all or a portion of the assets of such Person and whether or not
contingent, (i) every obligation of such Person for money borrowed, (ii) every
obligation of such Person evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the acquisition
of Property, (iii) every reimbursement obligation of such Person with respect to
letters of credit, bankers' acceptances or similar facilities issued for the
account of such Person, (iv) every obligation of such Person issued or assumed
as the deferred purchase price of Property or services (including securities
repurchase agreements but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business), (v) every Capital Lease
Obligation of such Person and all Attributable Value in respect of Sale and
Leaseback Transactions entered into by such Person, (vi) all obligations to
redeem or repurchase Disqualified Stock issued by such Person, (vii) the
liquidation preference of any Preferred Stock (other than Disqualified Stock,
which is covered by the preceding clause (vi)) issued by any Restricted
Subsidiary of such Person, (viii) every obligation under Interest Rate or
Currency Protection Agreements of such Person and (ix) every obligation of the
type referred to in clauses (i) through (viii) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has Guaranteed. The "amount" or "principal amount" of Debt at any time of
determination as used herein represented by (a) any Debt issued at a price that
is less than the principal amount at maturity thereof, shall be, except
10
as otherwise set forth herein, the Accreted Value of such Debt at such time or
(b) in the case of any Receivables sale constituting Debt, the amount of the
unrecovered purchase price (that is, the amount paid for Receivables that has
not been actually recovered from the collection of such Receivables) paid by the
purchaser (other than the Company or a Wholly Owned Restricted Subsidiary of the
Company) thereof. The amount of Debt represented by an obligation under an
Interest Rate or Currency Protection Agreement shall be equal to (x) zero if
such obligation has been Incurred pursuant to clause (x) of paragraph (b) of
Section 1010 or (y) the notional amount of such obligation if not Incurred
pursuant to such clause.
"Default" means any event, act or condition the occurrence of which is, or
after notice or the passage of time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 307.
"Depository" means The Depository Trust Company, its nominees and
successors.
"Designation" and "Designation Amount" have the respective meanings
specified in Section 1019.
"Disqualified Stock" of any Person means any Capital Stock of such Person
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the final Stated Maturity of the Securities;
provided, however, that any Preferred Stock which would not constitute
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Disqualified Stock but for provisions thereof giving holders thereof the right
to require the Company to repurchase or redeem such Preferred Stock upon the
occurrence of a change of control occurring prior to the final Stated Maturity
of the Securities shall not constitute Disqualified Stock if the change of
control provisions applicable to such Preferred Stock are no more favorable to
the holders of such Preferred Stock than the provisions applicable to the
Securities contained in Section 1009 and such Preferred Stock specifically
provides that the Company will not repurchase or redeem any such stock pursuant
to such provisions prior to the Company's repurchase of such Securities as are
required to be repurchased pursuant to Section 1009.
"Disqualified Stock Dividends" means all dividends with respect to
Disqualified Stock of the Company held by Persons other than a Wholly Owned
Restricted Subsidiary. The amount of any such dividend shall be equal to the
quotient of such dividend divided by the difference between one and the maximum
statutory federal income tax rate (expressed as a decimal number between 1
11
and 0) applicable to the Company for the period during which such dividends were
paid.
"Eligible Receivables" means, at any time, Receivables of the Company and
its Restricted Subsidiaries, as evidenced on the most recent quarterly
consolidated balance sheet of the Company as at a date at least 45 days prior to
such time, arising in the ordinary course of business of the Company or any
Restricted Subsidiary.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as amended (or
any successor act), and the rules and regulations thereunder (or respective
successors thereto).
"Exchange Securities " has the meaning stated in the first recital of this
Indenture.
"Excess Proceeds" has the meaning specified in Section 1016.
"Expiration Date" has the meaning specified in "Offer to Purchase" below.
"Fair Market Value" means, with respect to any Property, the price that
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under pressure
or compulsion to complete the transaction. Unless otherwise specified herein,
Fair Market Value shall be determined by the Board of Directors acting in good
faith and shall be evidenced by a Board Resolution delivered to the Trustee.
"Federal Bankruptcy Code" means the Bankruptcy Act of Title 11 of the
United States Code, as amended from time to time.
"Global Security" means a Rule 144A Global Security, an Institutional
Accredited Investor Global Security or a Regulation S Global Security, as the
case may be.
"Government Securities" means direct obligations of, or obligations fully
and unconditionally guaranteed or insured by, the United States of America or
any agency or instrumentality thereof for the payment of which obligations or
guarantee the full faith and credit of the United States is pledged and which
are not callable or redeemable at the issuer's option (unless, for purposes of
the definition of "Cash Equivalents" only, the obligations are redeemable or
callable at a price not less than the purchase price paid by the Company or the
applicable Restricted Subsidiary, together with all accrued and unpaid interest
(if any) on such Government Securities).
"Guarantee" by any Person means any obligation, direct or indirect,
contingent or otherwise, of such Person guaranteeing,
12
or having the economic effect of guaranteeing, any Debt of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or to purchase (or to advance or supply funds for the purchase of) any
security for the payment of such Debt, including any such obligations arising by
virtue of partnership arrangements or by agreements to keep-well, (ii) to
purchase Property or services or to take-or-pay for the purpose of assuring the
holder of such Debt of the payment of such Debt, (iii) to maintain working
capital, equity capital or other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such Debt or (iv)
entered into for the purpose of assuring in any other manner the obligee against
loss in respect thereof, in whole or in part (and "Guaranteed", "Guaranteeing"
and "Guarantor" shall have meanings correlative to the foregoing); provided,
--------
however, that the Guarantee by any Person shall not include endorsements by such
-------
Person for collection or deposit, in either case, in the ordinary course of
business.
"Guarantor" means a Restricted Subsidiary of the Company that has executed
a Restricted Subsidiary Guarantee, until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Guarantor" shall mean such successor Person.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Incur" means, with respect to any Debt or other obligation of any Person,
to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Debt or other obligation
including the recording, as required pursuant to generally accepted accounting
principles or otherwise, of any such Debt or other obligation on the balance
sheet of such Person (and "Incurrence", "Incurred", "Incurrable" and "Incurring"
shall have meanings correlative to the foregoing); provided, however, that a
-------- -------
change in generally accepted accounting principles that results in an obligation
of such Person that exists at such time becoming Debt shall not be deemed an
Incurrence of such Debt and that neither the accrual of interest nor the
accretion of original issue discount shall be deemed an Incurrence of Debt. Debt
otherwise incurred by a Person before it becomes a Subsidiary of the Company
shall be deemed to have been Incurred at the time at which it becomes a
Subsidiary.
"Indenture" means this instrument as originally executed and as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.
13
"Initial Foreign Purchaser" means each non-U.S. person (within the meaning
of Regulation S) that purchased Initial Securities from the Initial Purchasers
in offshore transactions meeting the requirements of Regulation S.
"Initial Purchasers" means Xxxxxxx Xxxxx Xxxxxx Inc., Xxxxxxx, Xxxxx & Co.,
Chase Securities Inc. and X.X. Xxxxxx Securities Inc.
"Initial Securities" has the meaning stated in the first recital of this
Indenture.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Institutional Accredited Investor Global Security" has the meaning
specified in Section 303.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.
"Interest Rate or Currency Protection Agreement" of any Person means any
forward contract, futures contract, swap, option or other financial agreement or
arrangement (including caps, floors, collars and similar agreements) relating
to, or the value of which is dependent upon, interest rates or currency exchange
rates or indices.
"Invested Capital" means the sum of (a) $500,000,000, (b) the aggregate net
proceeds received by the Company from the issuance or sale of any Capital Stock,
including Preferred Stock, of the Company but excluding Disqualified Stock,
subsequent to the Measurement Date, and (c) the aggregate net proceeds from the
issuance or sale of Debt of the Company or any Restricted Subsidiary subsequent
to the Measurement Date convertible or exchangeable into Capital Stock of the
Company other than Disqualified Stock, in each case upon conversion or exchange
thereof into Capital Stock of the Company subsequent to the Measurement Date;
provided, however, that the net proceeds from the issuance or sale of Capital
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Stock or Debt described in clause (b) or (c) shall be excluded from any
computation of Invested Capital to the extent (i) utilized to make a Restricted
Payment or (ii) such Capital Stock or Debt shall have been issued or sold to the
Company, a Subsidiary of the Company or an employee stock ownership plan or
trust established by the Company or any such Subsidiary for the benefit of their
employees.
"Investment" by any Person means any direct or indirect loan, advance or
other extension of credit or capital contribution (by means of transfers of cash
or other Property to others or payments for Property or services for the account
or use of others, or otherwise) to, purchase, redemption, retirement or
acquisition of Capital Stock, bonds, notes, debentures or
14
other securities or evidence of Debt issued by, or Incurrence of, or payment on,
a Guarantee of any obligation of, any other Person; provided that Investments
--------
shall exclude commercially reasonable extensions of trade credit. The amount, as
of any date of determination, of any Investment shall be the original cost of
such Investment, plus the cost of all additions, as of such date, thereto and
minus the amount, as of such date, of any portion of such Investment repaid to
such Person in cash as a repayment of principal or a return of capital, as the
case may be (except to the extent such repaid amount has been included in
Consolidated Net Income to support the actual making of Restricted Payments),
but without any other adjustments for increases or decreases in value, or write-
ups, write-downs or write-offs with respect to such Investment. In determining
the amount of any Investment involving a transfer of any Property other than
cash, such Property shall be valued at its Fair Market Value at the time of such
transfer.
"Issue Date" means the date on which the Initial Securities are initially
issued.
"Issue Date Rating" means B-3 in the case of Xxxxx'x and B in the case of
S&P, which are the respective ratings assigned to the Securities by the Rating
Agencies on the Issue Date.
"Joint Venture" means a Person in which the Company or a Restricted
Subsidiary holds not more than 50% of the shares of Voting Stock.
"Lien" means, with respect to any Property, any mortgage or deed of trust,
pledge, hypothecation, assignment, deposit arrangement, security interest, lien,
charge, easement (other than any easement not materially impairing usefulness),
encumbrance, preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever on or with respect to such Property
(including any Capital Lease Obligation, conditional sale or other title
retention agreement having substantially the same economic effect as any of the
foregoing and any Sale and Leaseback Transaction). For purposes of this
definition the sale, lease, conveyance or other transfer by the Company or any
of its Subsidiaries of, including the grant of indefeasible rights of use or
equivalent arrangements with respect to, dark or lit communications fiber
capacity or communications conduit shall not constitute a Lien.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security or an installment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, notice of redemption or otherwise.
"Measurement Date" means April 28, 1998, the date the 9-1/8% Senior Notes
were originally issued.
15
"Moody's" means Xxxxx'x Investors Service, Inc. or, if Xxxxx'x Investors
Service, Inc. shall cease rating debt securities having a maturity at original
issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
-------- -------
that if Xxxxx'x Investors Service, Inc. ceases rating debt securities having a
maturity at original issuance of at least one year and its ratings business with
respect thereto shall not have been transferred to any successor Person, then
"Moody's" shall mean any other national recognized rating agency (other than
S&P) that rates debt securities having a maturity at original issuance of at
least one year and that shall have been designated by the Trustee by a written
notice given to the Company.
"Net Available Proceeds" from any Asset Disposition by any Person means
cash or cash equivalents received (including amounts received by way of sale or
discounting of any note, installment receivable or other receivable, but
excluding any other consideration received in the form of assumption by the
acquiror of Debt or other obligations relating to such Property) therefrom by
such Person, net of (i) all legal, title and recording taxes, expenses and
commissions and other fees and expenses (including appraisals, brokerage
commissions and investment banking fees) Incurred and all federal, state,
provincial, foreign and local taxes required to be accrued as a liability as a
consequence of such Asset Disposition, (ii) all payments made by such Person or
its Subsidiaries on any Debt which is secured by such Property in accordance
with the terms of any Lien upon or with respect to such Property or which must
by the terms of such Lien, or in order to obtain a necessary consent to such
Asset Disposition or by applicable law, be repaid out of the proceeds from such
Asset Disposition, (iii) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or Joint Ventures of such
Person as a result of such Asset Disposition and (iv) appropriate amounts to be
provided by such Person or any Subsidiary thereof, as the case may be, as a
reserve in accordance with generally accepted accounting principles against any
liabilities associated with such Property and retained by such Person or any
Subsidiary thereof, as the case may be, after such Asset Disposition, including
liabilities under any indemnification obligations and severance and other
employee termination costs associated with such Asset Disposition, in each case
as determined by the board of directors of such Person, in its reasonable good
faith judgment evidenced by a Board Resolution filed with the Trustee; provided,
--------
however, that any reduction in such reserve within twelve months following the
-------
consummation of such Asset Disposition will be, for all purposes of this
Indenture and the Securities, treated as a new Asset Disposition at the time of
such reduction with Net Available Proceeds equal to the amount of such
reduction; provided further, however, that, in the event that any consideration
---------------- -------
for a transaction (which would otherwise constitute Net Available Proceeds) is
required to be held in escrow pending determination of whether a purchase price
adjustment will be made, at such time
16
as such portion of the consideration is released to such Person or its
Restricted Subsidiary from escrow, such portion shall be treated for all
purposes of this Indenture and the Securities as a new Asset Disposition at the
time of such release from escrow with Net Available Proceeds equal to the amount
of such portion of consideration released from escrow.
"9-1/8% Senior Notes" means the Company's 9-1/8% Senior Notes Due 2008 in
an aggregate principal amount not to exceed $2,000,000,000, originally issued on
April 28, 1998.
"9-1/8% Senior Notes Indenture" means the Indenture dated as of April 28,
1998, as amended, supplemented or modified from time to time, between the
Company and IBJ Xxxxxxxx Bank & Trust Company, as trustee, relating to the
9-1/8% Senior Notes.
"Non-Global Purchasers" has the meaning specified in Section 303.
"Offer" has the meaning specified in "Offer to Purchase" below.
"Offer to Purchase" means a written offer (the "Offer") sent by the Company
by first-class mail, postage prepaid, to each Holder of Securities at its
address appearing in the Security Register on the date of the Offer offering to
purchase up to the principal amount at maturity of Securities specified in such
Offer at the purchase price specified in such Offer (as determined pursuant to
this Indenture). Unless otherwise required by applicable law, the Offer shall
specify an expiration date (the "Expiration Date") of the Offer to Purchase
which shall be, subject to any contrary requirements of applicable law, not less
than 30 days or more than 60 days after the date of such Offer and a settlement
date (the "Purchase Date") for purchase of Securities within five Business Days
after the Expiration Date. The Company shall notify the Trustee at least 15
Business Days (or such shorter period as is acceptable to the Trustee) prior to
the mailing of the Offer of the Company's obligation to make an Offer to
Purchase, and the Offer shall be mailed by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company. The Offer
shall contain information concerning the business of the Company and its
Subsidiaries which the Company in good faith believes will enable such Holders
to make an informed decision with respect to the Offer to Purchase (which at a
minimum will include (i) the most recent annual and quarterly financial
statements and "Management's Discussion and Analysis of Financial Condition and
Results of Operations" contained in the documents required to be filed with the
Trustee pursuant to this Indenture (which requirements may be satisfied by
delivery of such documents together with the Offer), (ii) a description of
material developments in the Company's business subsequent to the date of the
latest of such financial statements referred to in clause (i) (including a
description of the events requiring the Company to make the Offer to Purchase),
(iii) if
17
applicable, appropriate pro forma financial information concerning the
Offer to Purchase and the events requiring the Company to make the Offer to
Purchase and (iv) any other information required by applicable law to be
included therein). The Offer shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant to the Offer to
Purchase. The Offer shall also state:
a. the Section of this Indenture pursuant to which the Offer to Purchase
is being made;
b. the Expiration Date and the Purchase Date;
c. the aggregate principal amount at maturity of the Outstanding
Securities offered to be purchased by the Company pursuant to the Offer to
Purchase (including, if less than 100% of the Outstanding Securities, the manner
by which such has been determined pursuant to the Section hereof requiring the
Offer to Purchase) (the "Purchase Amount");
d. the purchase price to be paid by the Company for $1,000 aggregate
principal amount at maturity of Securities accepted for payment (as specified
pursuant to this Indenture) (the "Purchase Price");
e. that the Holder may tender all or any portion of the Securities
registered in the name of such Holder and that any portion of a Security
tendered must be tendered in an integral multiple of $1,000 principal amount at
maturity;
f. the place or places where Securities are to be surrendered for tender
pursuant to the Offer to Purchase;
g. that any Securities not tendered or tendered but not purchased by the
Company will continue to accrue interest or accrete principal, as the case may
be;
h. that on the Purchase Date the Purchase Price will become due and
payable upon each Security being accepted for payment pursuant to the Offer to
Purchase and that interest thereon, if any, shall cease to accrue or the
principal thereon shall cease to accrete, as the case may be, on and after the
Purchase Date;
i. that each Holder electing to tender a Security pursuant to the Offer
to Purchase will be required to surrender such Security at the place or places
specified in the Offer prior to the close of business on the Expiration Date
(such Security being, if the Company or the Trustee so requires, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing);
j. that Holders will be entitled to withdraw all or any portion of
Securities tendered if the Company (or the Paying
18
Agent) receives, not later than the close of business on the Expiration Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount at maturity of the Security the Holder tendered,
the certificate number of the Security the Holder tendered and a statement that
such Holder is withdrawing all or a portion of his tender;
k. that (i) if Securities in an aggregate principal amount at maturity
less than or equal to the Purchase Amount are duly tendered and not withdrawn
pursuant to the Offer to Purchase, the Company shall purchase all such
Securities and (ii) if Securities in an aggregate principal amount at maturity
in excess of the Purchase Amount are tendered and not withdrawn pursuant to the
Offer to Purchase, the Company shall purchase Securities having an aggregate
principal amount at maturity equal to the Purchase Amount on a pro rata basis
--- ----
(with such adjustments as may be deemed appropriate so that only Securities in
denominations of $1,000 principal amount at maturity or integral multiples
thereof shall be purchased); and
l. that in the case of any Holder whose Security is purchased only in
part, the Company shall execute, and the Trustee shall authenticate and deliver
to the Holder of such Security without service charge, a new Security or
Securities, of any authorized denomination as requested by such Holder, in an
aggregate principal amount at maturity equal to and in exchange for the
unpurchased portion of the Security so tendered.
Any Offer to Purchase shall be governed by and effected in accordance with
the Offer for such Offer to Purchase.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board of Directors, a Vice Chairman of the Board of Directors, the President or
a Vice President, and by the Chief Financial Officer, the Chief Accounting
Officer, the Treasurer, an Assistant Treasurer, the Controller, the Secretary or
an Assistant Secretary of the Company and delivered to the Trustee, which shall
comply with this Indenture.
"Opinion of Counsel" means an opinion of counsel acceptable to the Trustee
(who may be counsel to the Company, including an employee of the Company).
"OECD" shall mean the Organization for Economic Cooperation and
Development.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
19
(ii) on and after any maturity or redemption date, Securities, or
portions thereof, for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that (a) the Trustee or the Paying
Agent, as applicable, is not prohibited from paying such money to the
Holders and (b) if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture;
(iii) Securities, except to the extent provided in Sections 1202 and
1203, with respect to which the Company has effected defeasance or covenant
defeasance as provided in Article Twelve; and
(iv) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands the Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
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principal amount at maturity of Outstanding Securities have given any request,
demand, authorization, direction, consent, notice or waiver hereunder, and for
the purpose of making the calculations required by TIA Section 313, Securities
owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in making such calculation or in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which any
Responsible Officer of the Trustee knows to be so owned or as to which the
Trustee has received written notice shall be so disregarded. Securities so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the Company
or such other obligor.
"Paying Agent" means any Person (including the Company acting as Paying
Agent) authorized by the Company to pay the Accreted Value of (and premium, if
any) or interest on any Securities on behalf of the Company.
"Permitted Holders" means the members of the Company's Board of Directors
on the Measurement Date and their respective
20
estates, spouses, ancestors, and lineal descendants, the legal representatives
of any of the foregoing and the trustees of any bona fide trusts of which the
foregoing are the sole beneficiaries or the grantors, or any Person of which the
foregoing "beneficially owns" (as defined in Rule 13d-3 under the Exchange Act)
at least 66-2/3% of the total voting power of the Voting Stock of such Person.
"Permitted Interest Rate or Currency Protection Agreement" of any Person
means any Interest Rate or Currency Protection Agreement entered into with one
or more financial institutions in the ordinary course of business that is
designed to protect such Person against fluctuations in interest rates or
currency exchange rates with respect to Debt Incurred and not for purposes of
speculation and which, in the case of an interest rate agreement, shall have a
notional amount no greater than the principal amount at maturity due with
respect to the Debt being hedged thereby.
"Permitted Investments" means (a) Cash Equivalents; (b) investments in
prepaid expenses; (c) negotiable instruments held for collection and lease,
utility and workers' compensation, performance and other similar deposits; (d)
loans, advances or extensions of credit to employees and directors made in the
ordinary course of business and consistent with past practice; (e) obligations
under Permitted Interest Rate or Currency Protection Agreements; (f) bonds,
notes, debentures and other securities received as a result of Asset
Dispositions pursuant to and in compliance with Section 1016; (g) Investments in
any Person as a result of which such Person becomes a Restricted Subsidiary; (h)
Investments made prior to the Measurement Date; (i) Investments made after the
Measurement Date in Persons engaged in the Telecommunications/IS Business in an
aggregate amount not to exceed Invested Capital; and (j) additional Investments
in an aggregate amount not to exceed $200,000,000.
"Permitted Liens" means (a) Liens for taxes, assessments, governmental
charges, levies or claims which are not yet delinquent or which are being
contested in good faith by appropriate proceedings, if a reserve or other
appropriate provision, if any, as shall be required in conformity with generally
accepted accounting principles shall have been made therefor; (b) other Liens
incidental to the conduct of the Company's and its Restricted Subsidiaries'
businesses or the ownership of its Property not securing any Debt, and which do
not in the aggregate materially detract from the value of the Company's and its
Restricted Subsidiaries' Property when taken as a whole, or materially impair
the use thereof in the operation of its business; (c) Liens, pledges and
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of statutory obligations;
(d) Liens, pledges or deposits made to secure the performance of tenders, bids,
leases, public or statutory obligations, sureties, stays, appeals, indemnities,
performance
21
or other similar bonds and other obligations of like nature incurred in the
ordinary course of business (exclusive of obligations for the payment of
borrowed money, the obtaining of advances or credit or the payment of the
deferred purchase price of Property and which do not in the aggregate materially
impair the use of Property in the operation of the business of the Company and
the Restricted Subsidiaries taken as a whole); (e) zoning restrictions,
servitudes, easements, rights-of-way, restrictions and other similar charges or
encumbrances incurred in the ordinary course of business which, in the
aggregate, do not materially detract from the value of the Property subject
thereto or materially interfere with the ordinary conduct of the business of the
Company or its Restricted Subsidiaries; and (f) any interest or title of a
lessor in the Property subject to any lease other than a Capital Lease.
"Permitted Telecommunications Capital Asset Disposition" means the
transfer, conveyance, sale, lease or other disposition of optical fiber and/or
conduit and any related equipment used in a Segment (as defined) of the
Company's communications network that (i) constitute capital assets in
accordance with generally accepted accounting principles and (ii) after giving
effect to such disposition, would result in the Company retaining at least
either (A) 24 optical fibers per route mile on such Segment as deployed at the
time of such disposition or (B) 12 optical fibers and one empty conduit per
route mile on such Segment as deployed as such time. "Segment" means (x) with
respect to the Company's intercity network, the through-portion of such network
between two local networks (i.e., Omaha to Denver) and (y) with respect to a
local network of the Company (i.e., Dallas), the entire through-portion of such
network, excluding the spurs which branch off the through-portion.
"Person" means any individual, corporation, company, partnership, joint
venture, limited liability company, association, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Physical Security" has the meaning specified in Section 303.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for a mutilated
security or in lieu of a lost, destroyed or stolen Security shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or stolen Security.
"Preferred Stock" of any Person means Capital Stock of such Person of any
class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution
22
of assets upon any voluntary or involuntary liquidation, dissolution or winding-
up of such Person, to shares of Capital Stock of any other class of such Person.
"Preferred Stock Dividends" means all dividends with respect to Preferred
Stock of Restricted Subsidiaries held by Persons other than the Company or a
Wholly Owned Restricted Subsidiary. The amount of any such dividend shall be
equal to the quotient of such dividend divided by the difference between one and
the maximum statutory federal income rate (expressed as a decimal number between
1 and 0) applicable to the issuer of such Preferred Stock for the period during
which such dividends were paid.
"Private Exchange Offer" means the offer by the Company, pursuant to
Section 2(f) of the Registration Agreement, to issue and deliver to certain
purchasers, in exchange for the Initial Securities held by such purchasers as
part of their initial distribution, a like aggregate principal amount at
maturity of Private Exchange Securities.
"Private Exchange Securities" means the Exchange Securities to be issued
pursuant to this Indenture in connection with a Private Exchange Offer pursuant
to the Registration Agreement.
"Private Placement Legend" means the third paragraph of the legend set
forth in the Securities in the form set forth in Exhibit A.
"Property" means, with respect to any Person, any interest of such Person
in any kind of property or asset, whether real, personal or mixed, or tangible
or intangible, including Capital Stock in, and other securities of, any other
Person. For purposes of any calculation required pursuant to this Indenture, the
value of any Property shall be its Fair Market Value.
"Proportionate Interest" in any issuance of Capital Stock of a Restricted
Subsidiary means a ratio (i) the numerator of which is the aggregate amount of
all Capital Stock of such Restricted Subsidiary beneficially owned by the
Company and the Restricted Subsidiaries and (ii) the denominator of which is the
aggregate amount of Capital Stock of such Restricted Subsidiary beneficially
owned by all Persons (excluding, in the case of this clause (ii), any Investment
made in connection with such issuance).
"Purchase Amount" has the meaning specified in "Offer to Purchase" above.
"Purchase Date" has the meaning specified in "Offer to Purchase" above.
"Purchase Money Debt" means Debt (including Acquired Debt and Capital Lease
Obligations, mortgage financings and purchase
23
money obligations) incurred for the purpose of financing all or any part of the
cost of construction, installation, acquisition, lease, development or
improvement by the Company or any Restricted Subsidiary of any
Telecommunications/IS Assets of the Company or any Restricted Subsidiary and
including any related notes, Guarantees, collateral documents, instruments and
agreements executed in connection therewith, as the same may be amended,
supplemented, modified or restated from time to time.
"Purchase Price" has the meaning specified in "Offer to Purchase" above.
"Qualified Institutional Buyer" or "QIB" has the meaning specified in Rule
144A.
"Qualified Receivable Facility" means Debt of the Company or any Subsidiary
Incurred from time to time pursuant to either (x) credit facilities secured by
Receivables or (y) Receivables purchase facilities, and including any related
notes, Guarantees, collateral documents, instruments and agreements executed in
connection therewith, as the same may be amended, supplemented, modified or
restated from time to time.
"Rating Agencies" mean Moody's and S&P.
"Rating Date" means the earlier of the date of public notice of the
occurrence of a Change of Control or of the intention of the Company to effect a
Change of Control.
"Rating Decline" shall be deemed to have occurred if, no later than 90 days
after the Rating Date (which period shall be extended so long as the rating of
the Securities is under publicly announced consideration for possible downgrade
by any of the Rating Agencies), either of the Rating Agencies assigns or
reaffirms a rating to the Securities that is lower than the applicable Issue
Date Rating (or the equivalent thereof). If, prior to the Rating Date, either of
the ratings assigned to the Securities by the Rating Agencies is lower than the
applicable Issue Date Rating, then a Rating Decline will be deemed to have
occurred if such rating is not changed by the 90th day following the Rating
Date. A downgrade within rating categories, as well as between rating
categories, will be considered a Rating Decline.
"Receivables" means receivables, chattel paper, instruments, documents or
intangibles evidencing or relating to the right to payment of money and proceeds
and products thereof in each case generated in the ordinary course of business.
"Redemption Date", when used with respect to any Security to be redeemed,
in whole or in part, means the date fixed for such redemption by or pursuant to
this Indenture.
24
"Redemption Price", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"refinancing" has the meaning specified in Section 1010(b)(viii).
"Registered Exchange Offer" means the offer by the Company, pursuant to the
Registration Agreement, to certain Holders of Initial Securities, to issue and
deliver to such Holders, in exchange for the Initial Securities, a like
aggregate principal amount at maturity of Exchange Securities registered under
the Securities Act.
"Registration Agreement" means the Registration Agreement dated April 23,
1998, between the Company and the Initial Purchasers relating to the Initial
Securities.
"Registration Default" has the meaning specified in Exhibit A.
"Regular Record Date" for the interest payable on any Interest Payment Date
means the April 15 or October 15 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Security" has the meaning specified in Section 303.
"Required Filing Dates" has the meaning specified in Section 1007.
"Responsible Officer", when used with respect to the Trustee, means any
officer within the Trustee's Corporate Trust Office, including any vice
president, the Managing Director, the secretary, any assistant secretary, any
assistant treasurer, or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above-designated officers,
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Payment" has the meaning specified in Section 1012.
"Restricted Subsidiary" means (a) a Subsidiary of the Company or of a
Restricted Subsidiary that has not been designated or classified as an
Unrestricted Subsidiary pursuant to and in compliance with Section 1019 and (b)
an Unrestricted Subsidiary that is redesignated as a Restricted Subsidiary
pursuant to such Section.
25
"Restricted Subsidiary Guarantee" means a supplemental indenture to this
Indenture in substantially the form set forth in Exhibit B hereto, providing for
an unconditional Guarantee of payment in full of the Accreted Value of, premium,
if any, and interest on the Securities. Any such Restricted Subsidiary Guarantee
shall not be subordinate to any Debt of the Restricted Subsidiary providing the
Restricted Subsidiary Guarantee.
"Revocation" has the meaning specified in Section 1019.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Global Security" has the meaning specified in Section 303.
"S&P" means Standard & Poor's Ratings Service or, if Standard & Poor's
Ratings Service shall cease rating debt securities having a maturity at original
issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
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that if Standard & Poor's Rating Service ceases rating debt securities having a
maturity at original issuance of at least one year and its ratings business with
respect thereto shall not have been transferred to any successor Person, then
"S&P" shall mean any other national recognized rating agency (other than
Moody's) that rates debt securities having a maturity at original issuance of at
least one year and that shall have been designated by the Trustee by a written
notice given to the Company.
"Sale and Leaseback Transaction" of any Person means any direct or indirect
arrangement pursuant to which any Property is sold or transferred by such Person
or a Restricted Subsidiary of such person and is thereafter leased back from the
purchaser or transferee thereof by such Person or one of its Restricted
Subsidiaries. The stated maturity of such arrangement shall be the date of the
last payment of rent or any other amount due under such arrangement prior to the
first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any Securities authenticated and delivered under
this Indenture.
"Securities Act" means the Securities Act of 1933, as amended (or any
successor act), and the rules and regulations thereunder (or respective
successors thereto).
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Shelf Registration Statement" means a registration statement issued by the
Company in connection with the offer and
26
sale of Initial Securities pursuant to the Registration Agreement.
"Significant Subsidiary" means any Subsidiary that would be a "Significant
Subsidiary" of the Company within the meaning of Rule 1-02 under Regulation S-X
promulgated by the Commission.
"Special Assets" means (a) the Capital Stock or assets of Cable Michigan,
Inc., RCN Corporation, Commonwealth Telephone Enterprises, Inc., KCP, Inc. and
California Private Transportation Company, L.P. (and any intermediate holding
companies or other entities formed solely for the purpose of owning such Capital
Stock or assets) owned, directly or indirectly, by the Company or any Restricted
Subsidiary on the Measurement Date, and (b) any Property, other than cash, Cash
Equivalents and Telecommunications/IS Assets, received as consideration for the
disposition after the Measurement Date of Special Assets (as contemplated by the
first proviso in Section 1016).
"Special Interest" has the meaning specified in Exhibit A.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 307.
"Stated Maturity" when used with respect to a Security or any installment
of interest thereon, means the date specified in such Security as the fixed date
on which the Accreted Value of such Security or such installment of interest is
due and payable, including pursuant to any mandatory redemption provision (but
excluding any provision providing for the repurchase of such Security at the
option of the Holder thereof upon the happening of any contingency beyond the
control of the Company unless such contingency has occurred).
"Subordinated Debt" means Debt of the Company (a) that is not secured by
any Lien on or with respect to any Property now owned or acquired after the
Measurement Date and (b) as to which the payment of principal of (and premium,
if any) and interest and other payment obligations in respect of such Debt shall
be subordinate to the prior payment in full in cash of the Securities to at
least the following extent: (i) no payments of principal of (or premium, if any)
or interest on or otherwise due (including by acceleration or for additional
amounts) in respect of, or repurchases, redemptions or other retirements of,
such Debt (collectively, "payments of such Debt") may be permitted for so long
as any default (after giving effect to any applicable grace periods) in the
payment of principal (or premium, if any) or interest on the Securities exists,
including as a result of acceleration; (ii) in the event that any other Default
exists with respect to the Securities, upon notice by Holders of 25% or more in
aggregate principal amount of the Securities to the Trustee, the Trustee shall
have the right to give notice to the
27
Company and the holders of such Debt (or trustees or agents therefor) of a
payment blockage, and thereafter no payments of such Debt may be made for a
period of 179 days from the date of such notice, provided that not more than one
--------
such payment blockage notice may be given in any consecutive 360-day period,
irrespective of the number of defaults with respect to the Securities during
such period; (iii) if payment of such Debt is accelerated when any Securities
are Outstanding, no payments of such Debt may be made until three Business Days
after the Trustee receives notice of such acceleration and, thereafter, such
payments may only be made to the extent the terms of such Debt permit payment at
that time; and (iv) such Debt may not (x) provide for payments of principal of
such Debt at the stated maturity thereof or by way of a sinking fund applicable
thereto or by way of any mandatory redemption, defeasance, retirement or
repurchase thereof by the Company (including any redemption, retirement or
repurchase which is contingent upon events or circumstances but excluding any
retirement required by virtue of acceleration of such Debt upon an event of
default thereunder), in each case prior to the final Stated Maturity of the
Securities or (y) permit redemption or other retirement (including pursuant to
an offer to purchase made by the Company) of such other Debt at the option of
the holder thereof prior to the final Stated Maturity of the Securities, other
than, in the case of clause (x) or (y), any such payment, redemption or other
retirement (including pursuant to an offer to purchase made by the Company)
which is conditioned upon (A) a change of control of the Company pursuant to
provisions substantially similar to those described Section 1009 (and which
shall provide that such Debt will not be repurchased pursuant to such provisions
prior to the Company's repurchase of the Securities required to be repurchased
by the Company pursuant to the provisions described in Section 1009) or (B) a
sale or other disposition of assets pursuant to provisions substantially similar
to those described in Section 1016 (and which shall provide that such Debt will
not be repurchased pursuant to such provisions prior to the Company's repurchase
of the Securities required to be repurchased by the Company pursuant to the
provision described in Section 1016).
"Subsidiary" of any Person means (i) a corporation more than 50% of the
combined voting power of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person or by one or more other Subsidiaries of
such Person or by such Person and one or more Subsidiaries thereof or (ii) any
other Person (other than a corporation) in which such Person, or one or more
other Subsidiaries of such Person or such Person and one or more other
Subsidiaries thereof, directly or indirectly, has at least a majority ownership
and power to direct the policies, management and affairs thereof.
"Telecommunications/IS Assets" means (a) any Property (other than cash,
cash equivalents and securities) to be owned by the Company or any Restricted
Subsidiary and used in the Telecommunications/IS Business; (b) for purposes of
Sections 1010
28
and 1014 only, Capital Stock of any Person; or (c) for all other purposes of
this Indenture, Capital Stock of a Person that becomes a Restricted Subsidiary
as a result of the acquisition of such Capital Stock by the Company or another
Restricted Subsidiary from any Person other than an Affiliate of the Company;
provided, however, that, in the case of clause (b) or (c), such Person is
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primarily engaged in the Telecommunications/IS Business.
"Telecommunications/IS Business" means the business of (i) transmitting, or
providing services relating to the transmission of, voice, video or data through
owned or leased transmission facilities, (ii) constructing, creating, developing
or marketing communications networks, related network transmission equipment,
software and other devices for use in a communications business, (iii) computer
outsourcing, data center management, computer systems integration, reengineering
of computer software for any purpose (including, without limitation, for the
purposes of porting computer software from one operating environment or computer
platform to another or to address issues commonly referred to as "Year 2000
issues") or (iv) evaluating, participating or pursuing any other activity or
opportunity that is primarily related to those identified in (i), (ii) or (iii)
above; provided that the determination of what constitutes a
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Telecommunications/IS Business shall be made in good faith by the Board of
Directors.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as in
force at the date as of which this Indenture was executed, except as provided in
Section 905.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this Indenture until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor Trustee.
"Unrestricted Subsidiary" means (a) 91 Holding Corp.; (b) any Subsidiary of
an Unrestricted Subsidiary; and (c) any Subsidiary of the Company designated as
such pursuant to and in compliance with Section 1019 and not thereafter
redesignated as a Restricted Subsidiary as permitted pursuant thereto.
"Vice President", when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".
"Voting Stock" of any Person means Capital Stock of such Person which
ordinarily has voting power for the election of directors (or persons performing
similar functions) of such Person, whether at all times or only for so long as
no senior class of securities has such voting power by reason of any
contingency.
29
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
all of the outstanding Voting Stock or other ownership interests (other than
directors' qualifying shares) of which shall at the time be owned by such Person
or by one or more Wholly Owned Subsidiaries of such Person or by such Person and
one or more Wholly Owned Subsidiaries of such Person.
SECTION 102. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture (including any covenant compliance with which
constitutes a condition precedent) relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
--------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person
30
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated (with
proper identification of each matter covered therein) and form one instrument.
SECTION 104. Acts of Holders.
---------------
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agents duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 601) conclusive in favor of the Trustee and the Company,
if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of authority. The fact and date of
31
the execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner that the Trustee
deems sufficient.
(c) The principal amount at maturity and serial numbers of Securities held
by any Person, and the date of holding the same, shall be proved by the Security
Register.
(d) If the Company shall solicit from the Holders of Securities any
request, demand, authorization, direction, notice, consent, waiver or other Act,
the Company may, at its option, by or pursuant to a Board Resolution, fix in
advance a record date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. Notwithstanding TIA Section
316(c), such record date shall be the record date specified in or pursuant to
such Board Resolution, which shall be a date not earlier than the date 30 days
prior to the first solicitation of Holders generally in connection therewith and
not later than the date such solicitation is completed. If such a record date
is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record date, but only the
Holders of record at the close of business on such record date shall be deemed
to be Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or other
Act, and for that purpose the Outstanding Securities shall be computed as of
such record date; provided that no such authorization, agreement or consent by
--------
the Holders on such record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than six months
after the record date.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of the
same Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security. However, any such Holder or future Holder may revoke the request,
demand, authorization, direction, notice, consent, waiver or other Act of the
Holder as to such Holder's Security or portion of the Security if the Trustee
receives the notice of revocation before the date such Act becomes effective.
SECTION 105. Notices, etc., to Trustee and Company.
-------------------------------------
Any request, demand, authorization, direction, notice, consent, waiver or
Act of Holders or other document provided or
32
permitted by this Indenture to be made upon, given or furnished to, or filed
with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate
Finance Department, or
(2) the Company or any Guarantor by the Trustee or by any Holder
shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid,
to the Company or such Guarantor addressed to it (in the case of a
Guarantor, in care of the Company) at the address of the Company's
principal office specified in the first paragraph of this Indenture, or at
any other address previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders; Waiver.
-------------------------
Where this Indenture provides for notice of any event to Holders by the
Company or the Trustee, such notice shall be given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at the address of such Holder as it appears
in the Security Register, not later than the latest date, and not earlier than
the earliest date, prescribed for the giving of such notice. In any case where
notice to Holders is given by mail, neither the failure to mail such notice, nor
any defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Notices shall be
effective only upon receipt. Where this Indenture provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case by reason of the suspension of or irregularities in regular mail
service or by reason of any other cause, it shall be impracticable to mail
notice of any event to Holders when such notice is required to be given pursuant
to any provision of this Indenture, then any manner of giving such notice as
shall be satisfactory to the Trustee shall be deemed to be a sufficient giving
of such notice for every purpose hereunder.
SECTION 107. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
33
SECTION 108. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
SECTION 109. Separability Clause.
-------------------
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Securities, express or implied, shall
give to any Person, other than the parties hereto, any Paying Agent, any
Security Registrar and their successors hereunder and the Holders any legal or
equitable right, remedy or claim under this Indenture.
SECTION 111. Governing Law.
-------------
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 112. Conflict with Trust Indenture Act.
---------------------------------
The Trust Indenture Act shall apply as a matter of contract to this
Indenture for purposes of interpretation, construction and defining the rights
and obligations hereunder. If any provision hereof limits, qualifies or
conflicts with any provision of the Trust Indenture Act or another provision
which is required or deemed to be included in this Indenture by any of the
provisions of the Trust Indenture Act, such provision or requirement of the
Trust Indenture Act shall control.
If any provision of this Indenture modifies or excludes any provision of
the Trust Indenture Act that may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or excluded,
as the case may be.
SECTION 113. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date, or Stated
Maturity or Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of Accreted Value (or premium, if any) or interest need not be made on
such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the Interest Payment Date or Redemption Date or
34
at the Stated Maturity or Maturity; provided that no interest shall accrue for
--------
the period from and after such Interest Payment Date, Redemption Date, Stated
Maturity or Maturity, as the case may be.
SECTION 114. No Personal Liability of Directors, Officers, Employees and
-----------------------------------------------------------
Stockholders.
------------
No director, officer, employee, incorporator or stockholder of the Company
or any Guarantor, as such, shall have any liability for any obligations of the
Company or any Guarantor under the Securities or this Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation,
solely by reason of its status as a director, officer, employee, incorporator or
stockholder of the Company or a Guarantor. By accepting a Security, each Holder
waives and releases all such liability (but only such liability). The waiver
and release are part of the consideration for issuance of the Securities.
SECTION 115. Independence of Covenants.
-------------------------
All covenants and agreements in this Indenture shall be given independent
effect so that if a particular action or condition is not permitted by any of
such covenants, the fact that it would be permitted by an exception to, or be
otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default if such action is taken or condition exists.
SECTION 116. Exhibits.
--------
SECTION 117. Counterparts.
------------
All exhibits attached hereto are by this reference made a part hereof with
the same effect as if herein set forth in full.
This Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but one
and the same instrument.
SECTION 118. Duplicate Originals.
-------------------
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
35
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
---------------
The Securities and the Trustee's certificate of authentication with respect
thereto shall be in substantially the form set forth in Exhibit A hereto, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture, and may have such letters, numbers
or other marks of identification and such legends or endorsements placed thereon
as may be required to comply with the rules of any securities exchange or system
on which the Securities may be listed or eligible for trading or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. Any portion of the text of
any Security may be set forth on the reverse thereof, with an appropriate
reference thereto on the face of the Security.
The definitive Securities shall be printed, lithographed or engraved on
steel-engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange or system on which the Securities may be listed
or eligible for trading, all as determined by the officers of the Company
executing such Securities, as evidenced by their execution of such Securities.
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
---------------
The aggregate principal amount at maturity of Securities which may be
authenticated and delivered under this Indenture is limited to $833,815,000,
except for Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities pursuant to Section 304,
305, 306, 906, 1009, 1016 or 1108.
The Securities shall be known and designated as the "10-1/2% Senior
Discount Notes Due 2008" of the Company. Their Stated Maturity shall be
December 1, 2008. The Securities shall be issued at a discount of 59.966% of
their aggregate principal amount at maturity, and shall accrete at a rate of 10-
1/2% per annum, compounded semiannually, to 100% of their aggregate principal
amount at maturity by December 1, 2003. On December 1, 2003, cash interest
shall commence accruing at a rate of 10-1/2% per annum, which shall be payable
semiannually in arrears on June 1 and December 1 in each year, commencing on
June 1, 2003, and at said Stated Maturity, until the principal thereof is paid
or duly provided for. Notwithstanding the foregoing, with
36
respect to Initial Securities, if there has been a Registration Default the
Initial Securities shall from the date of such Registration Default bear Special
Interest up to but excluding the date on which such Registration Default is
cured, as set forth or referred to in the text of the Securities appearing in
Exhibit A hereto. Accrued Special Interest, if any, shall be paid in cash in
arrears semi-annually on June 1 and December 1 in each year, and the amount of
accrued Special Interest shall be determined on the basis of the number of days
actually elapsed. In addition, the Company may elect, upon not less than 60 days
prior notice given in the manner provided for in Section 106, to commence the
accrual of cash interest on all Outstanding Securities on or after December 1,
2001, in which case the outstanding principal amount at maturity of each
Security shall on such commencement date be reduced to the Accreted Value of
such Security as of such commencement date and cash interest shall be payable
with respect to such Security on each June 1 and December 1 thereafter, as set
forth or referred to in the text of the Securities.
Accreted Value of, premium, if any, and interest on the Securities will be
payable, and the Securities may be exchanged or transferred, at the office or
agency of the Company in The City of New York, which, unless otherwise provided
by the Company, will be the offices of the Trustee. At the option of the
Company, interest may be paid by check mailed to addresses of the Persons
entitled thereto as such addresses shall appear on the Security Register.
The interest rate on the Securities is subject to increase by the addition
of Special Interest and otherwise, all as set forth or referred to in the text
of the Securities appearing in Exhibit A hereto.
The Securities shall be redeemable as provided in Article Eleven.
At the election of the Company, the entire Debt on the Securities or
certain of the Company's obligations and covenants and certain Events of Default
thereunder may be defeased as provided in Article Twelve.
SECTION 302. Denominations.
-------------
The Securities will be issued without coupons and in fully registered form
only, in minimum denominations of $1,000 principal amount at maturity and
integral multiples thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
----------------------------------------------
The Securities shall be executed on behalf of the Company by its Chairman,
its President or a Vice President, under its corporate seal reproduced thereon
and attested by its Secretary
37
or an Assistant Secretary. The signature of any of these officers on the
Securities may be manual or facsimile signatures of the present or any future
such authorized officer and may be imprinted or otherwise reproduced on the
Securities.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Securities, and the Trustee in accordance with such Company
Order shall authenticate and deliver such Securities.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized signatory, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered hereunder
and is entitled to the benefits of this Indenture.
The Trustee shall authenticate and deliver (1) initially one or more Global
Securities for original issue in an aggregate principal amount at maturity not
to exceed $833,815,000 and (2) Exchange Securities for issue only in a
Registered Exchange Offer or a Private Exchange Offer pursuant to the
Registration Agreement, for a like principal amount at maturity of Initial
Securities, upon receipt of a Company Order, which shall specify the amount of
Securities to be authenticated, whether the Securities are to be Initial
Securities or Exchange Securities, the date on which such Securities are to be
authenticated and direct the Trustee to authenticate such Securities.
Except as described below, the Securities will be deposited with, or on
behalf of, the Depository, and registered in the name of Cede & Co. as the
Depository's nominee in the form of a global note certificate substantially in
the form of Exhibit A (the "Rule 144A Global Security"), for credit to the
respective accounts of the beneficial owners of the Securities represented
thereby.
Securities purchased by persons outside the United States pursuant to sales
in accordance with Regulation S under the Securities Act shall be deposited
with, or on behalf of, the
38
Depository, and registered in the name of Cede & Co. as the Depository's nominee
in the form of one or more global note certificates substantially in the form of
Exhibit A (each a "Regulation S Global Security"), for credit to the respective
accounts of the beneficial owners of the Securities represented thereby,
provided that upon such deposit all such Securities shall be credited to or
--------
through accounts maintained at the Depository by or on behalf of the Euroclear
System or Cedel Bank, societe anonyme.
Securities transferred to Institutional Accredited Investors will be
deposited with, or on behalf of, the Depository, and registered in the name of
Cede & Co. as the Depository's nominee in the form of one or more global note
certificates substantially in the form of Exhibit A (each a "Institutional
Accredited Investor Global Security"), for credit to the respective accounts of
the beneficial owners of the Securities represented thereby.
Securities transferred to any persons who are not Qualified Institutional
Buyers or Institutional Accredited Investors (other than persons outside the
United States pursuant to sales or transfers in accordance with Regulation S
under the Securities Act) (collectively, "Non-Global Purchasers") will be issued
in registered definitive form without coupons substantially in the form of
Exhibit A (the "Physical Securities"). Upon the transfer to a Qualified
Institutional Buyer, an Institutional Accredited Investor or to a person outside
the United States pursuant to a sale or transfer in accordance with Regulation S
under the Securities Act of Physical Securities initially issued to a Non-Global
Purchaser, such Physical Security will be exchanged for an interest in a Global
Security representing the principal amount at maturity of Securities being
transferred.
In case the Company, pursuant to Article Eight, shall be consolidated or
merged with or into any other Person or shall transfer, sell, lease, convey or
otherwise dispose of all or substantially all its assets to any other Person,
and the successor Person resulting from such consolidation, or surviving such
merger, or into which the Company shall have been merged, or the Person which
shall have received a transfer, sale, lease, conveyance or other disposition as
aforesaid, shall have executed an indenture supplemental hereto with the Trustee
pursuant to Article Eight, any of the Securities authenticated or delivered
prior to such consolidation, merger, transfer, sale, lease, conveyance or other
disposition may, from time to time, at the request of the successor Person, be
exchanged for other Securities executed in the name of the successor Person with
such changes in phraseology and form as may be appropriate, but otherwise in
substance of like tenor as the Securities surrendered for such exchange and of
like principal amount at maturity; and the Trustee, upon Company Request of the
successor Person, shall authenticate and deliver Securities as specified in such
request for the purpose of such exchange. If Securities shall at any time be
authenticated and delivered in any new name
39
of a successor Person pursuant to this Section in exchange or substitution for
or upon registration of transfer of any Securities, such successor Person, at
the option of the Holders but without expense to them, shall provide for the
exchange of all Securities at the time Outstanding for Securities authenticated
and delivered in such new name.
SECTION 304. Temporary Securities
--------------------
Pending the preparation of definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and deliver, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 1002,
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount at
maturity of definitive Securities of authorized denominations. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities.
SECTION 305. Registration, Registration of Transfer and Exchange
---------------------------------------------------
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency designated pursuant to Section 1002 being herein sometimes
referred to as the "Security Register") in which, subject to such reasonable
regulations as the Company may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Security
Register shall be in written form or any other form capable of being converted
into written form within a reasonable time. At all reasonable times, the
Security Register shall be open to inspection by the Trustee. The Trustee is
hereby initially appointed as security registrar (the "Security Registrar") for
the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the office
or agency of the Company designated pursuant to
40
Section 1002, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denomination or denominations of a like
aggregate principal amount at maturity.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination and of a like aggregate principal
amount at maturity, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Security Registrar) be duly
endorsed, or be accompanied by a written instrument of transfer, in form
satisfactory to the Company and the Security Registrar, duly executed by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any transfer tax or other similar governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906, 1009, 1016 or
1108 not involving any transfer.
The Company shall not be required (i) to issue, register the transfer of or
exchange any Security during a period beginning at the opening of business 15
days before the selection of Securities to be redeemed under Section 1104 and
ending at the close of business on the day of such mailing of the relevant
notice of redemption or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities
------------------------------------------------
If (i) any mutilated Security is surrendered to the Trustee or (ii) the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity sufficient to save each of
them harmless,
41
then, in the absence of actual notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and upon Company Order the Trustee shall authenticate and deliver, in exchange
for any such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount at maturity, bearing
a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other similar
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved
----------------------------------------------
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name such Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest at the office or
agency of the Company maintained for such purpose pursuant to Section 1002;
provided, however, that each installment of interest may at the Company's option
-------- -------
be paid by mailing a check for such interest, payable to or upon the written
order of the Person entitled thereto pursuant to Section 308, to the address of
such Person as it appears in the Security Register.
Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date shall forthwith cease to be
payable to the Holder on the Regular Record Date by virtue of such Holder having
been a Holder on the Regular Record Date, and such defaulted interest and (to
42
the extent lawful) interest on such defaulted interest at the rate borne by the
Securities (such defaulted interest and interest thereon herein collectively
called "Defaulted Interest") may be paid by the Company, at its election in each
case, as provided in paragraph (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest, which shall
be fixed in the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest
or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be
held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify
the Company of such Special Record Date, and in the name and at the expense
of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be given in the
manner provided for in Section 106, not less than 10 days prior to such
Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so given, such
Defaulted Interest shall be paid to the Persons in whose names the
Securities (or their respective Predecessor Securities) are registered at
the close of business on such Special Record Date and shall no longer be
payable pursuant to the following paragraph (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange or system on which the Securities may be listed or
eligible for trading, and upon such notice as may be required by such
exchange or system, if, after notice given by the Company to the Trustee of
the proposed payment pursuant to this clause, such manner of payment shall
be deemed practicable by the Trustee in its sole discretion.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security
43
shall carry the rights to interest accrued and unpaid, and to accrue, which were
carried by such other Security.
SECTION 308. Persons Deemed Owners
---------------------
Prior to the due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of Accreted Value of (and premium,
if any) and (subject to Sections 305 and 307) interest on such Security and for
all other purposes whatsoever, whether or not such Security is overdue, and none
of the Company, the Trustee or any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 309. Cancellation
------------
All Securities surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee (or to any
other Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and sold,
and all Securities so delivered shall be promptly cancelled by the Trustee. If
the Company shall so acquire any of the Securities, however, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless and until the same are surrendered to the
Trustee for cancellation. No Securities shall be authenticated in lieu of or in
exchange for any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities held by the
Trustee shall be disposed of by the Trustee in accordance with its customary
procedures and certification of their disposal delivered to the Company unless
by Company Order the Company shall direct that cancelled Securities be returned
to it.
SECTION 310. Computation of Interest
-----------------------
Interest on the Securities shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
SECTION 311. CUSIP Number
------------
The Company in issuing the Securities may use a "CUSIP" number (if then
generally in use), and if so, the Trustee may use the CUSIP numbers in notices
of redemption or exchange as a convenience to Holders; provided, however, that
-------- -------
any such notice may state that no representation is made as to the correctness
or
44
accuracy of the CUSIP number printed in the notice or on the Securities, and
that reliance may be placed only on the other identification numbers printed on
the Securities. The Company shall promptly notify the Trustee in writing of any
change in the CUSIP number of the Securities.
SECTION 312. Book-Entry Provisions for Global Securities
-------------------------------------------
(a) The Global Securities initially shall (i) be registered in the name of
the Depository or the nominee of such Depository, (ii) be deposited with the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
Exhibit A.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Security held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Security, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of the Global Security
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall (i) prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository or (ii) impair, as between the
Depository and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in whole,
but not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Rule 144A Global Security may be transferred
or exchanged for interests in an Institutional Accredited Investor Global
Security or a Regulation S Global Security, interests of beneficial owners in an
Institutional Accredited Investor Global Security may be transferred or
exchanged for interests in a Rule 144A Global Security or a Regulation S Global
Security and interests of beneficial owners in a Regulation S Global Security
may be transferred or exchanged for interests in a Rule 144A Global Security or
an Institutional Accredited Investor Global Security, in each case in accordance
with the rules and procedures of the Depository and the provisions of Section
313. Interests of beneficial owners in the Global Securities may be transferred
or exchanged for Physical Securities in accordance with the rules and procedures
of the Depository and the provisions of Section 313. In addition, Physical
Securities shall be transferred to all beneficial owners in exchange for their
beneficial interests in a Global Security if (i) the Depository notifies the
Company that it is unwilling or unable to continue as a depository for such
Global Security or if at any time the Depository ceases to be a clearing agency
registered under the Exchange Act, and a successor depository is not appointed
by the Company within 90 days, (ii) the Company
45
executes and delivers to the Trustee a notice that such Global Security shall be
so transferable, registrable and exchangeable, and such transfer shall be
registrable, or (iii) there shall have occurred and be continuing a Default or
Event of Default with respect to the Securities represented by such Global
Security.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Security to beneficial owners pursuant to
paragraph (b), the Security Registrar shall (if one or more Physical Securities
are to be issued) reflect on its books and records the date and a decrease in
the principal amount at maturity of the Global Security in an amount equal to
the principal amount at maturity of the beneficial interest in the Global
Security to be transferred, and the Company shall execute, and the Trustee shall
authenticate and deliver, one or more Physical Securities of like tenor and
principal amount at maturity of authorized denominations.
(d) In connection with the transfer of Global Securities as an entirety
to beneficial owners pursuant to paragraph (b), the Global Securities shall be
deemed to be surrendered to the Trustee for cancellation, and the Company shall
execute, and the Trustee shall authenticate and deliver, to each beneficial
owner identified by the Depository in exchange for its beneficial interest in
the Global Securities, an equal aggregate principal amount at maturity of
Physical Securities of like tenor of authorized denominations.
(e) Any Physical Security delivered in exchange for an interest in a
Global Security pursuant to paragraph (b) or (c) of this Section 312 shall,
except as otherwise provided by paragraph (d) of Section 313, bear the legend
regarding transfer restrictions applicable to the Physical Securities set forth
in Exhibit A.
(f) The Holder of any Global Security may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Securities.
(g) In the event that a Global Security is exchanged for Physical
Securities pursuant to this Section 312 prior to the consummation of a
Registered Exchange Offer or the effectiveness of a Shelf Registration Statement
with respect to such Securities, such Securities may be exchanged only in
accordance with such procedures as are substantially consistent with the
provisions of Sections 312 and 313 (including the certification requirements set
forth on the reverse of the Initial Securities intended to ensure that such
transfers comply with Rule 144A, Regulation S or such other applicable exemption
from registration under the Securities Act, as the case may be) and such other
procedures as may from time to time be adopted by the Company.
46
SECTION 313. Special Transfer Provisions.
---------------------------
(a) Transfers to Non-QIB Institutional Accredited Investors. The
--------------------------------------------------------
following provisions shall apply with respect to the registration of any
proposed transfer of a Security to any Institutional Accredited Investor which
is not a QIB (excluding transfers to non-U.S. persons):
(1) The Security Registrar shall register the transfer of any
Security if (x) the requested transfer is not prior to that date which is
two years (or such shorter period as may be prescribed by Rule 144(k) under
the Securities Act or any successor provision thereunder) after the later
of the original issue date of such Security (or of any Predecessor
Security) or three months after the last day on which the Company or any
Affiliate of the Company was the owner of such Security or any Predecessor
Security or (y) such transfer is being made by a proposed transferor who
has checked the box provided for on the form of Security stating, or who
has otherwise advised the Company and the Security Registrar in writing,
that the transfer has been made to an institutional "accredited investor"
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act)
and the proposed transferee has delivered to the Security Registrar a
certificate containing certain representations and agreements (the form of
which certificate can be obtained from the Trustee or the Company),
provided that no Initial Foreign Purchaser or any foreign purchaser who has
purchased Securities from an Initial Foreign Purchaser or from any person
other than a QIB or an Institutional Accredited Investor pursuant to
paragraph (b) below shall be permitted to transfer any Securities so
purchased by it to an Institutional Accredited Investor pursuant to this
paragraph (a) prior to the date that is 40 days following the Issue Date.
(2) Subject to paragraph (1) above, if (i) the proposed transferee is
an Agent Member, and the Securities to be transferred consist of Physical
Securities which after transfer are to be evidenced by an interest in the
Institutional Accredited Investor Global Security, upon receipt by the
Security Registrar of instructions given in accordance with the
Depository's and the Security Registrar's procedures, the Security
Registrar shall reflect on the Security Register the date and an increase
in the principal amount at maturity of the Institutional Accredited
Investor Global Security in an amount equal to the principal amount at
maturity of the Physical Securities to be transferred, and the Trustee
shall cancel the Physical Securities so transferred, and (ii) the proposed
transferor is an Agent Member holding a beneficial interest in a Rule 144A
Global Security or a Regulation S Global Security, upon receipt by the
Security Registrar of instructions given in accordance with the
Depository's and the Security
47
Registrar's procedures, the Security Registrar shall reflect on its books
and records the date of such transfer and (A) a decrease in the principal
amount at maturity of such Rule 144A Global Security or Regulation S Global
Security, as the case may be, in an amount equal to the principal amount at
maturity of the beneficial interest in a Global Security to be transferred,
and (B) an increase in the principal amount at maturity of an Institutional
Accredited Investor Global Security in an amount equal to the principal
amount at maturity to be transferred.
(b) Transfers to Non-U.S. Persons. The following provisions shall apply
------------------------------
with respect to the registration of any proposed transfer of a Security to any
non-U.S. person:
(1) The Security Registrar shall register the transfer of any
Security if (x) the requested transfer is not prior to that date which is
two years (or such shorter period as may be prescribed by Rule 144(k) under
the Securities Act or any successor provision thereunder) after the later
of the original issue date of such Security (or of any Predecessor
Security) or three months after the last day on which the Company or any
Affiliate of the Company was the owner of such Security or any Predecessor
Security or (y) such transfer is being made by a proposed transferor who
has checked the box provided for on the form of Security stating, or who
has otherwise advised the Company and the Security Registrar in writing,
that the transfer has been made outside the U.S. in an offshore transaction
within the meaning of Regulation S in compliance with the exemption from
registration under the Securities Act provided by Rule 904 under the
Securities Act, provided that, if such transfer is being effected by an
Initial Foreign Purchaser or any foreign purchaser who has purchased
Securities from an Initial Foreign Purchaser or from any person other than
a QIB or an Institutional Accredited Investor pursuant to this paragraph
(b) prior to the date that is 40 days following the Issue Date, the
transferee shall have certified to the Company and the Trustee that such
transferee is a non-U.S. person (within the meaning of Regulation S) and
that such transferee is acquiring the Securities in an offshore transaction
(within the meaning of Regulation S).
(2) Subject to paragraph (1) above, if (i) the proposed transferee is
an Agent Member, and the Securities to be transferred consist of Physical
Securities which after transfer are to be evidenced by an interest in the
Regulation S Global Security, upon receipt by the Security Registrar of
instructions given in accordance with the Depository's and the Security
Registrar's procedures, the Security Registrar shall reflect on the
Security Register the date and an increase in the principal amount at
maturity of the Regulation S Global Security in an amount equal to the
principal amount of at maturity the Physical Securities
48
to be transferred, and the Trustee shall cancel the Physical Securities so
transferred, and (ii) the proposed transferor is an Agent Member holding a
beneficial interest in a Rule 144A Global Security or an Institutional
Accredited Investor Global Security, upon receipt by the Security Registrar
of instructions given in accordance with the Depository's and the Security
Registrar's procedures, the Security Registrar shall reflect on its books
and records the date of such transfer and (A) a decrease in the principal
amount at maturity of such Rule 144A Global Security or Institutional
Accredited Investor Global Security, as the case may be, in an amount equal
to the principal amount at maturity to be transferred and (B) an increase
in the principal amount at maturity of a Regulation S Global Security in an
amount equal to the principal amount at maturity to be transferred.
(c) Transfers to QIBs. The following provisions shall apply with respect
------------------
to the registration of any proposed transfer of a Security to any QIB (excluding
transfers to non-U.S. persons):
(1) The Security Registrar shall register the transfer of any
Security if (x) the requested transfer is not prior to that date which is
two years (or such shorter period as may be prescribed by Rule 144(k) under
the Securities Act or any successor provision thereunder) after the later
of the original issue date of such Security (or of any Predecessor
Security) or three months after the last day on which the Company or any
Affiliate of the Company was the owner of such Security or any Predecessor
Security or (y) such transfer is being made by a proposed transferor who
has checked the box provided for on the form of Security stating, or who
has otherwise advised the Company and the Security Registrar in writing,
that the transfer has been made in compliance with the exemption from
registration under the Securities Act provided under Rule 144A to a
transferee who has signed the certification provided for on the form of
Security stating, or has otherwise advised the Company and the Security
Registrar in writing, that such transferee represents and warrants that it
is purchasing the Security for its own account or an account with respect
to which it exercises sole investment discretion and that each of it and
any such account is a QIB within the meaning of Rule 144A and is aware that
the sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as it has requested
pursuant to Rule 144A or has determined not to request such information and
that it is aware that the transferor is relying upon the foregoing
representations in order to claim the exemption from registration provided
by Rule 144A.
(2) Subject to paragraph (1) above, if (i) the proposed transferee is
an Agent Member, and the Securities
49
to be transferred consist of Physical Securities which after transfer are
to be evidenced by an interest in the Rule 144A Global Security, upon
receipt by the Security Registrar of instructions given in accordance with
the Depository's and the Security Registrar's procedures, the Security
Registrar shall reflect on the Security Register the date and an increase
in the principal amount at maturity of the Rule 144A Global Security in an
amount equal to the principal amount at maturity of the Physical Securities
to be transferred, and the Trustee shall cancel the Physical Securities so
transferred, and (ii) the proposed transferor is an Agent Member holding a
beneficial interest in an Institutional Accredited Investor Global Security
or a Regulation S Global Security, upon receipt by the Security Registrar
of instructions given in accordance with the Depository's and the Security
Registrar's procedures, the Security Registrar shall reflect on its books
and records the date of such transfer and (A) a decrease in the principal
amount at maturity of such Institutional Accredited Investor Global
Security or Regulation S Global Security, as the case may be, in an amount
equal to the principal amount at maturity to be transferred and (B) an
increase in the principal amount at maturity of a Rule 144A Global Security
in an amount equal to the principal amount at maturity to be transferred.
(d) Private Placement Legend. (1) Upon the registration of transfer,
-------------------------
exchange or replacement of Securities, the Security Registrar shall deliver only
Securities that bear the Private Placement Legend unless (i) the transfer or
exchange of Initial Securities contemplated by paragraph (d)(2) or (d)(3) below
has occurred or (ii) (x) the circumstances contemplated by clause (a)(1)(x),
(b)(1)(x) or (c)(1)(x) of this Section 313 exist and (y) there is delivered to
the Security Registrar and the Trustee an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act.
(2) After a transfer of any Initial Securities during the period of
the effectiveness of a Shelf Registration Statement with respect to such
Initial Securities, all requirements pertaining to legends on such Initial
Security will cease to apply, the requirements requiring that any such
Initial Security be issued in global form will cease to apply, and an
Initial Security in certificated or global form without legends will be
available to the transferee of the Holder of such Initial Securities upon
exchange of such transferring Holder's certificated Initial Security. Upon
the occurrence of any of the circumstances described in this paragraph, the
Company will deliver an Officers' Certificate to the Trustee instructing
the Trustee to issue Securities without legends.
50
(3) Upon the consummation of a Registered Exchange Offer with respect
to the Initial Securities pursuant to which certain Holders of such Initial
Securities are offered Exchange Securities (other than Private Exchange
Securities) in exchange for their Initial Securities, all requirements
pertaining to such Initial Securities that Initial Securities be issued in
global form will cease to apply, and certificated Initial Securities with
the Private Placement Legend will be available to Holders of such Initial
Securities that do not exchange their Initial Securities, and Exchange
Securities in certificated or global form will be available to Holders that
exchange such Initial Securities in such Registered Exchange Offer. Upon
the occurrence of any of the circumstances described in this paragraph, the
Company will deliver an Officers' Certificate to the Trustee instructing
the Trustee to issue Securities without legends.
(4) Upon the consummation of a Private Exchange Offer with respect to
the Initial Securities pursuant to which Holders of such Initial Securities
are offered Private Exchange Securities in exchange for their Initial
Securities, all requirements pertaining to such Initial Securities that
Initial Securities issued to certain Holders be issued in global form will
continue to apply, and Private Exchange Securities in global form will be
available to Holders that exchange such Initial Securities in such Private
Exchange Offer.
(e) Other Transfers. If a Holder proposes to transfer a Security pursuant
----------------
to any exemption from the registration requirements of the Securities Act other
than as provided for by Sections 313(a), 313(b) and 313(c) and other than
pursuant to Section 313(d)(4), the Security Registrar shall only register such
transfer or exchange if such transferor delivers to the Security Registrar and
the Trustee an Opinion of Counsel satisfactory to the Company and the Security
Registrar that such transfer is in compliance with the Securities Act and the
terms of this Indenture.
(f) General. By its acceptance of any Security bearing the Private
--------
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Security Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 312 or this Section
313 for a period of two years, during which time such letters, notices and other
written communications shall at the written request of the Company be delivered
to the Company. After retaining any such copies of letters, notices and other
written communications for a period of at least two years,
51
all such copies may be destroyed by the Trustee. The Company shall have the
right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable prior
written notice to the Security Registrar.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall cease to be of further effect (subject to Section 1206
and except as to surviving rights of registration of transfer, transfer,
exchange and replacement of Securities expressly provided for herein or pursuant
hereto) and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture when
(1) either
(a) all Outstanding Securities have been delivered to the Trustee
for cancellation; or
(b) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable within one year, or
(iii) are to be called for redemption within one year
under irrevocable arrangements satisfactory to the Trustee in its
sole discretion for the giving of notice of redemption by the
Trustee in the name and at the expense of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be deposited with the Trustee funds
in an amount sufficient to pay and discharge the entire indebtedness
on the Securities not theretofore delivered to the Trustee for
cancellation, for Accreted Value of (and premium, if any, on), and
interest on, the Securities to Maturity or the Redemption Date, as the
case may be;
(2) the Company has paid or caused to be paid all other sums payable
by the Company hereunder; and
52
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations under Sections 607 and 609 and, if money shall have been deposited
with the Trustee pursuant to clause (1)(b) of this Section 401, the obligations
of the Trustee under Section 402 and the last paragraph of Section 1003 shall
survive.
SECTION 402. Application of Trust Money
--------------------------
Subject to the provisions of the last paragraph of Section 1003, all money
deposited with the Trustee pursuant to Section 401 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the Accreted Value (and premium,
if any) and interest for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default
-----------------
"Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(1) failure to pay Accreted Value of (or premium, if any, on) any
Security when due; or
(2) failure to pay any interest on any Security when due, continued
for 30 days; or
(3) default in the payment of Accreted Value of (and premium, if any)
and interest on Securities required to be purchased pursuant to an Offer to
Purchase pursuant to Section 1009 when due and payable; or
(4) failure to perform or comply with the provisions of Section 801,
803 or 1016; or
53
(5) failure to perform any covenant or agreement of the Company or
any Guarantor in this Indenture or in any Security (other than a covenant a
default in whose performance is elsewhere in this Section specifically
dealt with) continued for 60 days after written notice to the Company by
the Trustee or Holders of at least 25% in aggregate principal amount at
maturity of the Outstanding Securities, which notice shall specify the
default and state that such notice is a "Notice of Default" hereunder; or
(6) default under the terms of any instrument evidencing or securing
Debt of the Company or any Restricted Subsidiary having an outstanding
principal amount of not less than $25,000,000 or its foreign currency
equivalent at the time which default results in the acceleration of the
payment of such indebtedness or constitutes the failure to pay such
indebtedness when due (after expiration of any applicable grace period); or
(7) the rendering of a judgment or judgments against the Company or
any Restricted Subsidiary in an aggregate amount in excess of $25,000,000
or its foreign currency equivalent at the time and shall not be waived,
satisfied or discharged for any period of 45 consecutive days during which
a stay of enforcement shall not be in effect; or
(8) any Restricted Subsidiary Guarantee ceases to be in full force
and effect (other than in accordance with the terms of such Restricted
Subsidiary Guarantee) or any Guarantor denies or disaffirms its obligations
under its Restricted Subsidiary Guarantee; or
(9) the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Company or any Significant Subsidiary a bankrupt
or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of
the Company or any Significant Subsidiary under the Federal Bankruptcy Code
or any other applicable federal, state or foreign law, or appointing a
receiver, liquidator, assignee, trustee, custodian or sequestrator (or
other similar official) of the Company or any Significant Subsidiary or of
any substantial part of its Property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or
(10) the institution by the Company or any Significant Subsidiary of
proceedings to be adjudicated a bankrupt or insolvent, or the consent by it
to the institution of bankruptcy or insolvency proceedings against it, or
the filing by it of a petition or answer or consent seeking reorganization
or relief under the Federal Bankruptcy Code or any other applicable
federal, state or foreign law, or
54
the consent by it to the filing of any such petition or to the appointment
of a receiver, liquidator, assignee, trustee, custodian or sequestrator (or
other similar official) of the Company or any Significant Subsidiary or of
any substantial part of its Property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due.
SECTION 502. Acceleration of Maturity; Rescission and Annulment
--------------------------------------------------
If an Event of Default (other than an Event of Default specified in Section
501(9) or 501(10) with respect to the Company) shall occur and be continuing,
the Trustee or the Holders of not less than 25% in aggregate principal amount at
maturity of the Outstanding Securities may declare the Accreted Value, premium,
if any, and accrued and unpaid interest in respect of all the Securities to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such Accreted Value,
premium, if any, and accrued and unpaid interest shall become immediately due
and payable. If an Event of Default specified in Section 501(9) or 501(10)
occurs with respect to the Company, the Accreted Value, premium, if any, and
accrued and unpaid interest in respect of all the Securities shall ipso facto
---- -----
become immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder.
At any time after a declaration of acceleration has been made and before a
judgment or decree for payment of the money due has been obtained by the Trustee
as hereinafter provided in this Article Five, the Holders of a majority in
aggregate principal amount at maturity of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Outstanding Securities,
(B) all unpaid Accreted Value of (and premium, if any, on) any
Outstanding Securities which has become due otherwise than by such
declaration of acceleration, and interest on such unpaid Accreted
Value at the rate borne by the Securities,
(C) to the extent that payment of such interest is lawful,
interest on overdue interest at the rate borne by the Securities, and
55
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default, other than the nonpayment of amounts of
Accreted Value of (or premium, if any, on) Securities which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee
-------
The Company covenants that if
(a) default is made in the payment of any interest on any Security when
due, continued for 30 days, or
(b) default is made in the payment of the Accreted Value of (or premium,
if any, on) any Security when due,
the Company will, upon demand of the Trustee, pay to the Trustee for the benefit
of the Holders of such Securities the whole amount then due and payable on such
Securities for Accreted Value (and premium, if any) and interest, and interest
on any overdue Accreted Value (and premium, if any) and, to the extent that
payment of such interest shall be legally enforceable, upon any overdue
installment of interest, at the rate borne by the Securities, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
56
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 504. Trustee May File Proofs of Claim
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the Property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the Accreted Value of the
Securities shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made any demand
on the Company for the payment of overdue Accreted Value, premium, if any, or
interest) shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(i) to file and prove a claim for the whole amount of Accreted Value
(and premium, if any) and interest owing and unpaid in respect of the
Securities and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee and its agents and counsel) and of the Holders allowed in
such judicial proceeding, and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator or sequestrator (or
other similar official) in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee and its agents and counsel, and any
other amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities
-----------------------------------------------------------
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without
57
the possession of any of the Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name and as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee and its agents
and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected
------------------------------
Any money collected by the Trustee pursuant to this Article Five shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of Accreted Value (or
premium, if any) or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 607;
SECOND: To the payment of the amounts then due and unpaid for Accreted
Value of (and premium, if any) and interest on the Securities in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on such Securities for Accreted Value (and premium, if any) and
interest, respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
SECTION 507. Limitation on Suits
-------------------
No Holder of any Securities shall have any right to institute any
proceeding with respect to this Indenture or for any other remedy hereunder,
unless
(1) such Holder shall have previously given to the Trustee written
notice of a continuing Event of Default;
(2) the Holders of not less than 25% in aggregate principal amount at
maturity of the Outstanding Securities shall have made written request and
offered reasonable indemnity to the Trustee to institute such proceeding as
trustee; and
(3) the Trustee shall not have received from the Holders of a
majority in aggregate principal amount at maturity of the Outstanding
Securities a direction inconsistent with such request and shall have failed
to institute such proceeding within 60 days;
58
it being understood and intended that no one or more Holders shall have any
right in any manner whatsoever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive Accreted Value,
---------------------------------------------------------
Premium and Interest.
--------------------
Notwithstanding any other provision in this Indenture, including Section
507, the Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment as provided herein (including, if applicable,
Article Twelve) and in such Security of the Accreted Value of (and premium, if
any) and (subject to Section 307) interest on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.
SECTION 509. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities in the last paragraph of Section
306, no right or remedy herein conferred upon or reserved to the Trustee or to
the Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event
59
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article Five or by law to the Trustee or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or by
the Holders, as the case may be.
SECTION 512. Control by Holders.
------------------
The Holders of a majority in aggregate principal amount at maturity of the
Outstanding Securities shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee; provided that
--------
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee that is not inconsistent with such direction, and
(3) the Trustee need not take any action which might involve it in
personal liability or be unjustly prejudicial to the Holders not
consenting.
SECTION 513. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in principal amount at maturity of
the Outstanding Securities may, on behalf of the Holders of all the Securities,
waive any past Default hereunder and its consequences, except a Default
(1) in the payment of the Accreted Value of (or premium, if any) or
interest on any Security, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Security affected.
The Company shall deliver to the Trustee an Officers' Certificate stating
that the requisite majority have consented to such waiver and attaching such
consents upon which, subject to Section 104, the Trustee may conclusively rely.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
SECTION 514. Waiver of Stay or Extension Laws.
--------------------------------
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, or plead, or in
60
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
-----------------------------------
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but, in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that
(1) this paragraph (c) shall not be construed to limit the effect of
paragraph (a) of this Section 601;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
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(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Holders of a majority in principal amount at maturity of the
Outstanding Securities relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or indemnity reasonably satisfactory to it
against such risk or liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
601.
SECTION 602. Notice of Default.
-----------------
If a Default occurs and is continuing, the Trustee shall transmit, in the
manner and to the extent provided in TIA Section 313(c), notice of such Default
within 60 days after it is known to any Responsible Officer of the Trustee or
written notice of it is received by the Trustee; provided, however, that, except
-------- -------
in the case of a Default in the payment of the Accreted Value of (or premium, if
any) or interest on any Security, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee, a
trust committee of directors or Responsible Officers of the Trustee in good
faith determines that the withholding of such notice is in the interest of the
Holders.
The Trustee is not required to take notice or deemed to have notice of
any Event of Default with respect to the Securities, except an Event of Default
under Section 501(1), (2), (3) or (4) hereof (provided that in the case of
Section 501(4), such Event of Default constitutes a failure to purchase
Securities pursuant to an Offer to Purchase pursuant to Section 1016), unless
the Trustee shall have received written notice at its Corporate Trust Office
(which notice shall reference the Securities, the Company and the Indenture) of
such Event of Default from the Company or any Holder or unless a Responsible
Officer of the Trustee shall otherwise have knowledge thereof.
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SECTION 603. Certain Rights of Trustee.
-------------------------
Subject to Section 601 and to the provisions of TIA Sections 315(a) through
315(d):
(1) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, receive and rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee may act through counsel, agents, custodians and
nominees and shall not be responsible for the misconduct or negligence of
any such person appointed and supervised with due care and in good faith;
(6) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall
have offered to the Trustee security or indemnity reasonably satisfactory
to it against the costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction;
(7) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts
63
or matters as it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
(8) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within
the discretion or rights or powers conferred upon it by this Indenture.
SECTION 604. Trustee Not Responsible for Recitals or Issuance of
---------------------------------------------------
Securities.
----------
The recitals contained herein and in the Securities, except for the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities, except that the Trustee represents that it is
duly authorized to execute and deliver this Indenture, authenticate the
Securities and perform its obligations hereunder. The Trustee shall not be
accountable for the use or application by the Company of Securities or the
proceeds thereof.
SECTION 605. May Hold Securities.
-------------------
The Trustee, any Paying Agent, any Security Registrar or any other agent of
the Company or of the Trustee, in its individual or any other capacity, may
become the owner or pledgee of Securities and, subject to TIA Sections 310(b)
and 311, may otherwise deal with the Company with the same rights it would have
if it were not Trustee, Paying Agent, Security Registrar or such other agent.
SECTION 606. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed with the Company.
SECTION 607. Compensation and Reimbursement.
------------------------------
The Company agrees:
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
64
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to the Trustee's negligence,
willful misconduct or bad faith; and
(3) to indemnify the Trustee and its directors, officers, employees
and agents for, and to hold them harmless against, any loss, liability or
expense incurred without negligence, willful misconduct or bad faith on the
part of any of them, arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself or themselves against any claim or liability in connection with the
exercise or performance of any of its or their powers or duties hereunder.
The obligations of the Company under this Section 607 to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disbursements and
advances and to indemnify and hold harmless the Trustee shall constitute
additional indebtedness hereunder. As security for the performance of such
obligations of the Company, the Trustee shall have a claim prior to the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of Accreted Value of (and premium, if
any, on) or interest on particular Securities.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 501(9) or (10), the expenses (including
the reasonable charges and expenses of its counsel) of and the compensation for
such services are intended to constitute expenses of administration under any
applicable federal, state or foreign bankruptcy, insolvency or other similar
law.
The provisions of this Section 607 shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee.
SECTION 608. Corporate Trustee Required; Eligibility; Conflicting
----------------------------------------------------
Interests.
---------
(a) There shall be at all times a Trustee hereunder which shall be subject
to and comply with the provisions of Section 310(a)(1) of the Trust Indenture
Act and shall have a combined capital and surplus of at least $50,000,000. If
such Person publishes reports of condition at least annually, pursuant to law or
to the requirements of federal, state, territorial or District of Columbia
supervising or examining authority, then,
65
for the purposes of this Section 608, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time a Responsible
Officer of the Trustee shall have actual knowledge that the Trustee ceases to be
eligible in accordance with the provisions of this Section 608, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article Six.
(b) The Trustee shall be subject to and comply with Section 310(b) of the
Trust Indenture Act.
SECTION 609. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article Six shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 610.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company. If the instrument of acceptance by a successor Trustee required by
Section 610 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of not
less than a majority in aggregate principal amount at maturity of the
Outstanding Securities, delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of TIA
Section 310(b) after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months, or
(2) the Trustee shall cease to be eligible under Section 608(a) and
shall fail to resign after written request therefor by the Company or by
any Holder who has been a bona fide Holder of a Security for at least six
months, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
66
then, in any such case, (i) the Company, by a Board Resolution, may remove the
Trustee or (ii) subject to TIA Section 315(e), any Holder who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee. If the
Company does not promptly appoint a successor Trustee after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
shall be appointed by Act of the Holders of a majority in aggregate principal
amount at maturity of the Outstanding Securities delivered to the Company and
the retiring Trustee. In either case, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment, become the successor Trustee
and supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders and accepted
appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to the Holders of
Securities in the manner provided for in Section 106. Each notice shall include
the name of the successor Trustee and the address of its Corporate Trust Office.
(g) The retiring Trustee shall not be liable for any of the acts or
omissions of any successor Trustee appointed hereunder.
SECTION 610. Acceptance of Appointment by Successor.
--------------------------------------
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
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and confirming to such successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article Six.
SECTION 611. Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any Person into which the Trustee may be merged or converted or with which
it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
all or substantially all of the corporate trust business of the Trustee, shall
be the successor of the Trustee hereunder; provided that such Person shall be
--------
otherwise qualified and eligible under this Article Six, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto. In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion,
consolidation or transfer of assets to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
In case at that time any of the Securities shall not have been authenticated,
any successor Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor Trustee. In all such
cases such certificates shall have the full force and effect which this
Indenture provides that the certificate of authentication of the Trustee shall
have; provided, however, that the right to adopt the certificate of
-------- -------
authentication of any predecessor Trustee or to authenticate Securities in the
name of any predecessor Trustee shall apply only to its successor or successors
by merger, conversion, consolidation or transfer of assets.
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders.
--------------------------------------------
Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that none of the Company or the Trustee or any agent
of either of them shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Holders in accordance with
TIA Section 312, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under TIA Section 312(b).
68
SECTION 702. Reports by Trustee.
------------------
Within 60 days after May 15 of each year commencing with the first May 15
after the first issuance of Securities, the Trustee shall transmit to the
Holders, in the manner and to the extent provided in TIA Section 313(c), a brief
report dated as of such May 15 if required by TIA Section 313(a).
A copy of each such report at the time of its mailing to Holders shall be
filed with the Commission and the principal national securities exchange (if
any) on which the Securities are listed.
The Company shall notify a Responsible Officer of the Trustee if the
Securities become listed on any national securities exchange or of any delisting
thereof.
SECTION 703. Reports by Company.
------------------
The Company shall file with the Trustee and deliver to the Holders of
Securities the reports and other information required to be provided by it
pursuant to Section 1007.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, etc., Only on Certain Terms.
----------------------------------------------------
The Company shall not, in a single transaction or a series of related
transactions, (i) consolidate with or merge into any other Person or Persons or
permit any other Person to consolidate with or merge into the Company or (ii)
directly or indirectly, transfer, sell, lease, convey or otherwise dispose of
all or substantially all its assets to any other Person or Persons, unless:
(1) in a transaction in which the Company is not the surviving Person
or in which the Company transfers, sells, leases, conveys or otherwise
disposes of all or substantially all of its assets to any other Person, the
resulting, surviving or transferee Person (the "successor entity") is
organized under the laws of the United States of America or any State
thereof or the District of Columbia and shall expressly assume, by a
supplemental indenture executed and delivered to the Trustee in form
satisfactory to the Trustee, all of the Company's obligations under this
Indenture;
(2) immediately before and after giving effect to such transaction
and treating any Debt which becomes an obligation of the Company (or the
successor entity) or a Restricted Subsidiary as a result of such
transaction as having been Incurred by the Company or such Restricted
69
Subsidiary at the time of the transaction, no Default or Event of Default
shall have occurred and be continuing;
(3) immediately after giving effect to such transaction, the
Consolidated Net Worth of the Company (or the successor entity) is equal to
or greater than that of the Company immediately prior to the transaction;
(4) immediately after giving effect to such transaction and treating
any Debt which becomes an obligation of the Company (or the successor
entity) or a Restricted Subsidiary as a result of such transaction as
having been Incurred by the Company or such Restricted Subsidiary at the
time of the transaction, the Company (or the successor entity) could Incur
at least $1.00 of additional Debt pursuant to the provisions of paragraph
(a) of Section 1010;
(5) if, as a result of any such transaction, Property of the Company
(or the successor entity) or any Restricted Subsidiary would become subject
to a Lien prohibited by the provisions of Section 1014, the Company (or the
successor entity) shall have secured the Securities as required by said
covenant;
(6) in the case of a transfer, sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company, such
assets shall have been transferred as an entirety or virtually as an
entirety to one Person and such Person shall have complied with all the
provisions of this paragraph; and
(7) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each in form and substance reasonably
satisfactory to the Trustee, stating that such consolidation, merger,
transfer, sale, lease, conveyance or other disposition and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture, complies with this Article and that all
conditions precedent herein provided for relating to such transaction have
been complied with, and, with respect to such Officers' Certificate,
setting forth the manner of determination of the Consolidated Net Worth, in
accordance with clause (3) of this Section 801, of the Company or, if
applicable, of the successor entity as required pursuant to the foregoing.
SECTION 802. Successor Company Substituted.
-----------------------------
Upon any consolidation of the Company with or merger of the Company with or
into any other Person or any transfer, sale, lease, conveyance or other
disposition of all or substantially all the assets of the Company to any Person
or Persons in
70
accordance with Section 801, the successor Person formed by such consolidation
or into which the Company is merged or to which such transfer, sale, lease,
conveyance or other disposition is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor Person had been named as the Company
herein, and the predecessor Company (which term shall for this purpose mean the
Person named as the "Company" in the first paragraph of this Indenture or any
successor Person which shall have become such in the manner described in Section
801), except in the case of a lease, shall be released from all its obligations
and covenants under this Indenture and the Securities and may be dissolved and
liquidated.
SECTION 803. Guarantor May Consolidate, etc., Only on Certain Terms.
------------------------------------------------------
The Company shall not permit any Guarantor to, in a single transaction or a
series of related transactions, (i) consolidate with or merge into any other
Person or Persons (other than the Company or another Guarantor) or permit any
other Person (other than the Company or another Guarantor) to consolidate with
or merge into such Guarantor or (ii) directly or indirectly, transfer, sell,
lease, convey or otherwise dispose of all or substantially all its assets to any
other Person or Persons (other than the Company or another Guarantor), unless:
(1) in a transaction in which such Guarantor is not the surviving
Person or in which such Guarantor transfers, sells, leases, conveys or
otherwise disposes of all or substantially all of its assets to any other
Person, the resulting, surviving or transferee Person (the "successor
guarantor") is organized under the laws of the United States of America or
any State thereof or the District of Columbia and shall expressly assume,
by a supplemental indenture executed and delivered to the Trustee in form
satisfactory to the Trustee, all of such Guarantor's obligations under this
Indenture;
(2) immediately before and after giving effect to such transaction
and treating any Debt which becomes an obligation of the Company or a
Restricted Subsidiary (including the successor guarantor) as a result of
such transaction as having been Incurred by the Company or such Restricted
Subsidiary at the time of the transaction, no Default or Event of Default
shall have occurred and be continuing;
(3) immediately after giving effect to such transaction, the
Consolidated Net Worth of the Company is equal to or greater than that of
the Company immediately prior to the transaction;
71
(4) immediately after giving effect to such transaction and treating
any Debt which becomes an obligation of the Company or a Restricted
Subsidiary (including the successor guarantor) as a result of such
transaction as having been Incurred by the Company or such Restricted
Subsidiary at the time of the transaction, the Company could Incur at least
$1.00 of additional Debt pursuant to the provisions of paragraph (a) of
Section 1010;
(5) if, as a result of any such transaction, Property of the Company
or any Restricted Subsidiary (including the successor guarantor) would
become subject to a Lien prohibited by the provisions of Section 1014, the
Company shall have secured the Securities as required by said covenant;
(6) in the case of a transfer, sale, lease, conveyance or other
disposition of all or substantially all of the assets of such Guarantor,
such assets shall have been transferred as an entirety or virtually as an
entirety to one Person and such Person shall have complied with all the
provisions of this paragraph; and
(7) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each in form and substance reasonably
satisfactory to the Trustee, stating that such consolidation, merger,
transfer, sale, lease, conveyance or other disposition and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture, complies with this Article and that all
conditions precedent herein provided for relating to such transaction have
been complied with, and, with respect to such Officers' Certificate,
setting forth the manner of determination of the Consolidated Net Worth, in
accordance with clause (3) of this Section 803, of such Guarantor or, if
applicable, of the successor guarantor as required pursuant to the
foregoing.
SECTION 804. Successor Guarantor Substituted.
-------------------------------
Upon any consolidation of a Guarantor with or merger of a Guarantor with or
into any other Person or any transfer, sale, lease, conveyance or other
disposition of all or substantially all the assets of a Guarantor to any Person
or Persons in accordance with Section 803, the successor Person formed by such
consolidation or into which such Guarantor is merged or to which such transfer,
sale, lease, conveyance or other disposition is made shall succeed to, and be
substituted for, and may exercise every right and power of, such Guarantor under
this Indenture with the same effect as if such successor Person had been named
as a Guarantor herein, and the predecessor Guarantor (which term shall for this
purpose mean the Person named as the "New Guarantor" in the first paragraph of
the applicable supplemental indenture or any successor Person which shall have
become such in
72
the manner described in Section 803), except in the case of a lease, shall be
released from all its obligations and covenants under its Restricted Subsidiary
Guarantee and the Securities and may be dissolved and liquidated.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
The Company and the Trustee may, at any time and from time to time, without
notice to or consent of any Holders of Securities, enter into one or more
indentures supplemental hereto:
(1) to evidence the succession of another Person to the Company or a
Guarantor and the assumption by such successor of the covenants of the
Company or such Guarantor herein and in the Securities; or
(2) to add to the covenants of the Company, for the benefit of the
Holders, or to surrender any right or power conferred upon the Company
hereby; or
(3) to add any additional Events of Default; or
(4) to provide for uncertificated Securities in addition to or in
place of certificated Securities; or
(5) to evidence and provide for the acceptance of appointment
hereunder of a successor Trustee pursuant to the requirements of
Section 610; or
(6) to secure the Securities; or
(7) to comply with the Trust Indenture Act or the Securities Act
(including Regulation S promulgated thereunder); or
(8) to add additional Guarantees with respect to the Securities or to
release Guarantors from Restricted Subsidiary Guarantees as provided by the
terms of this Indenture; or
(9) to cure any ambiguity herein, to correct or supplement any
provision herein which may be inconsistent with any other provision herein,
or to add any other provision with respect to matters or questions arising
under this Indenture; provided such actions shall not adversely affect the
--------
interests of the Holders in any material respect.
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SECTION 902. Supplemental Indentures With Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than a majority in principal
amount at maturity of the Outstanding Securities, by Act of such Holders
delivered to the Company and the Trustee, the Company and the Trustee may enter
into one or more indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or waiving or otherwise modifying in any manner the rights of the
Holders, provided that no such supplemental indenture shall, without the consent
--------
of the Holder of each Outstanding Security affected thereby:
(1) change the Stated Maturity of the Accreted Value of, or any
installment of interest on, any Security, or reduce the Accreted Value
thereof or the interest thereon that would be due and payable upon the
Stated Maturity thereof, or change the place of payment where, or the coin
or currency in which, any Security or any premium or interest thereon is
payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof; or
(2) reduce the percentage in principal amount at maturity of the
Outstanding Securities, the consent of whose Holders is necessary for any
such supplemental indenture or required for any waiver of compliance with
certain provisions of this Indenture or certain Defaults hereunder; or
(3) subordinate in right of payment, or otherwise subordinate, the
Securities to any other Debt; or
(4) except as otherwise provided herein, release any security
interest that may have been granted in favor of the Holders of the
Securities; or
(5) reduce the premium payable upon the redemption of any Security
nor change the time at which any Security may be redeemed, as described in
Exhibit A; or
(6) reduce the premium payable upon a Change of Control Triggering
Event or, at any time after a Change of Control Triggering Event has
occurred, change the time at which the Offer to Purchase relating thereto
must be made or at which the Securities must be repurchased pursuant to
such Offer to Purchase; or
(7) at any time after the Company is obligated to make an Offer to
Purchase with the Net Available Proceeds from Asset Dispositions, change
the time at which such Offer to Purchase must be made or at which the
Securities must be repurchased pursuant thereto; or
74
(8) make any change in any Restricted Subsidiary Guarantee that would
adversely affect the Holders of the Securities;
(9) modify any provision of the Indenture relating to the calculation
of Accreted Value with respect to the Securities; or
(10) modify any provision of this Section 902 (except to increase any
percentage set forth herein).
It shall not be necessary for any Act of Holders under this Section 902 to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article Nine or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture and an Officers' Certificate stating that all
conditions precedent to the execution of such supplemental indenture have been
fulfilled. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article Nine,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article Nine shall
conform as a matter of contract or law to the requirements of the Trust
Indenture Act as then in effect.
SECTION 906. Reference in Securities to Supplemental Indentures.
--------------------------------------------------
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article Nine may bear a notation in form
approved by the Trustee and the Company as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Securities so
modified as to
75
conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities.
SECTION 907. Notice of Supplemental Indentures.
---------------------------------
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to this Article Nine, the Company shall give
notice thereof to the Holders of each Outstanding Security affected, in the
manner provided for in Section 106, setting forth in general terms the substance
of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Accreted Value, Premium, if any, and Interest.
--------------------------------------------------------
The Company covenants and agrees for the benefit of the Holders that it
shall duly and punctually pay the Accreted Value of (and premium, if any) and
interest on the Securities in accordance with the terms of the Securities and
this Indenture.
SECTION 1002. Maintenance of Office or Agency.
-------------------------------
The Company shall maintain in The City of New York an office or agency
where Securities may be presented or surrendered for payment, where Securities
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Corporate Trust Office of the Trustee shall be
such office or agency of the Company, unless the Company shall designate and
maintain some other office or agency for one or more of such purposes. The
Company shall give prompt written notice to the Trustee of any change in the
location of any such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other offices
or agencies (in or outside of The City of New York) where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind any such designation; provided, however, that no such designation or
-------- -------
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in The City of New York for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
76
rescission and any change in the location of any such other office or agency.
SECTION 1003. Money for Security Payments to Be Held in Trust.
-----------------------------------------------
If the Company shall at any time act as its own Paying Agent, it shall, on
or before each due date of the Accreted Value of (or premium, if any) or
interest on any of the Securities, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the Accreted Value of
(or premium, if any) or interest so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and shall promptly
notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for the
Securities, it shall, on or before each due date of the Accreted Value of (or
premium, if any) or interest on any Securities, deposit with a Paying Agent a
sum sufficient to pay the Accreted Value (and premium, if any) or interest so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such Accreted Value, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of such
action or any failure so to act.
The Company shall cause each Paying Agent (other than the Trustee) to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section 1003,
that such Paying Agent shall:
(1) hold all sums held by it for the payment of the Accreted Value
of, premium, if any, or interest on Securities in trust for the benefit of
the Persons entitled thereto until such sums shall be paid to such Persons
or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any payment of Accreted
Value, premium, if any, or interest;
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent; and
(4) indemnify the Trustee and its officers, directors, employees and
agents against any loss, cost or liability caused by, or incurred as a
result of, such Paying Agent's acts or omissions.
77
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
sums.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the Accreted Value of, premium, if any,
or interest on any Security and remaining unclaimed for two years after such
Accreted Value, premium or interest has become due and payable shall be paid to
the Company on Company Request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Security shall thereafter, as
an unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
-------- -------
required to make any such repayment, may at the expense of the Company cause to
be published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 1004. Corporate Existence.
-------------------
Subject to Article Eight, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect the corporate
existence, rights (charter and statutory) and franchises of the Company and each
Subsidiary of the Company; provided, however, that the Company shall not be
-------- -------
required to preserve, with respect to the Company, any such right or franchise
or, with respect to any such Subsidiary (subject to all the other covenants in
this Indenture), any such corporate existence, right or franchise, if the Board
of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries as
a whole and that the loss thereof is not disadvantageous in any material respect
to the Holders.
SECTION 1005. Maintenance of Properties.
-------------------------
The Company shall cause all properties owned by the Company or any
Restricted Subsidiary or used or held for use in the conduct of its business or
the business of any Restricted Subsidiary to be maintained and kept in good
condition, repair
78
and working order and supplied with all necessary equipment and shall cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
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Section 1005 shall prevent the Company from discontinuing the maintenance of any
of such properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business or the business of any Subsidiary and
not disadvantageous in any material respect to the Holders.
SECTION 1006. Insurance.
---------
The Company shall at all times keep all of its and its Restricted
Subsidiaries' properties which are of an insurable nature insured with insurers,
believed by the Company to be responsible, against loss or damage to the extent
that property of similar character is usually so insured by companies similarly
situated and owning like properties.
SECTION 1007. Reports.
-------
Whether or not the Company is subject to Section 13(a) or 15(d) of the
Exchange Act, or any successor provision thereto, the Company shall file with
the Commission the annual reports, quarterly reports and other documents which
the Company would have been required to file with the Commission pursuant to
such Section 13(a) or 15(d) or any successor provision thereto if the Company
were subject thereto, such documents to be filed with the Commission on or prior
to the respective dates (the "Required Filing Dates") by which the Company would
have been required to file them. The Company shall also in any event (a) within
15 days of each Required Filing Date (i) transmit by mail to all Holders, as
their names and addresses appear in the Security Register, without cost to such
Holders, and (ii) file with the Trustee copies of the annual reports, quarterly
reports and other documents (without exhibits) which the Company would have been
required to file with the Commission pursuant to Section 13(a) or 15(d) of the
Exchange Act or any successor provisions thereto if the Company were subject
thereto and (b) if filing such documents by the Company with the Commission is
not permitted under the Exchange Act, promptly upon written request, supply
copies of such documents (without exhibits) to any prospective Holder.
SECTION 1008. Statement by Officers as to Default.
-----------------------------------
(a) The Company shall deliver to the Trustee, on the date of delivery of
each annual report to be delivered pursuant to Section 1007, a brief certificate
from the principal executive officer, principal financial officer or principal
accounting officer as to his or her knowledge of the Company's compliance during
the period covered by such report with all conditions and covenants under this
Indenture. If the signer has knowledge of
79
any noncompliance that occurred during such period, the certificate shall
describe its status and what action the Company has taken or is taking or
proposes to take with respect thereto. For purposes of this Section 1008(a),
such compliance shall be determined without regard to any period of grace or
requirement of notice under this Indenture.
(b) When any Default has occurred and is continuing under this Indenture,
or if the trustee for or the holder of any other evidence of Debt of the Company
or any Restricted Subsidiary gives any notice or takes any other action with
respect to a claimed default (other than with respect to Debt in the principal
amount of less than $25,000,000 or its foreign currency equivalent at the time),
the Company shall, within 30 days of such occurrence, notice or other action,
deliver to the Trustee by registered or certified mail or by telegram, telex or
facsimile transmission an Officers' Certificate specifying such event, notice or
other action, its status and what action the Company is taking or purposes to
take with respect thereto.
SECTION 1009. Change of Control Triggering Event.
----------------------------------
(a) Upon the occurrence of a Change of Control Triggering Event, each
Holder shall have the right to require that the Company repurchase such Holder's
Securities in whole or in part in integral multiples of $1,000 principal amount
at maturity, in accordance with the procedures set forth in this Section 1009
and this Indenture.
(b) Within 30 days of the occurrence of both a Change of Control and a
Rating Decline with respect to the Securities (a "Change of Control Triggering
Event"), the Company will be required to make an Offer to Purchase all
Outstanding Securities at a price in cash equal to 101% of the Accreted Value of
the Securities on the purchase date, plus accrued and unpaid interest (if any)
to such purchase date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date).
(c) The Company and the Trustee shall perform their respective obligations
for the Offer to Purchase as specified in the Offer. Prior to the Purchase
Date, the Company shall (i) accept for payment Securities or portions thereof
tendered pursuant to the Offer, (ii) irrevocably deposit with the Paying Agent
(or, if the Company is acting as its own Paying Agent, segregate and hold in
trust as provided in Section 1003) money sufficient to pay the Purchase Price of
all Securities or portions thereof so accepted (provided that such deposit may
be made no later than 11:00 A.M. New York City time on the Purchase Date if the
Company elects) and (iii) deliver or cause to be delivered to the Trustee all
Securities so accepted together with an Officers' Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent shall promptly mail or deliver to Holders of Securities so
80
accepted payment in an amount equal to the Purchase Price, and the Trustee shall
promptly authenticate and mail or deliver to such Holders a new Security or
Securities equal in principal amount at maturity to any unpurchased portion of
the principal amount at maturity of the Security surrendered as requested by the
Holder. Any Security not accepted for payment shall be promptly mailed or
delivered by the Company to the Holder thereof. In the event that the aggregate
Purchase Price is less than the amount delivered by the Company to the Trustee
or the Paying Agent, the Trustee or the Paying Agent, as the case may be, shall
deliver the excess to the Company immediately after the Purchase Date.
(d) A "Change of Control" means the occurrence of any of the following
events:
(i) if any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act or any successor provisions to either
of the foregoing), including any group acting for the purpose of acquiring,
holding, voting or disposing of securities within the meaning of Rule 13d-
5(b)(1) under the Exchange Act, other than any one or more of the Permitted
Holders, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act, except that a person will be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, of 35% or more of the total voting power of
the Voting Stock of the Company; provided, however, that the Permitted
-------- -------
Holders are the "beneficial owners" (as defined in Rule 13d-3 under the
Exchange Act, except that a person will be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, in the aggregate of a lesser percentage of
the total voting power of the Voting Stock of the Company than such other
person or group (for purposes of this clause (i), such person or group
shall be deemed to beneficially own any Voting Stock of a corporation (the
"specified corporation") held by any other corporation (the "parent
corporation") so long as such person or group beneficially owns, directly
or indirectly, in the aggregate a majority of the total voting power of the
Voting Stock of such parent corporation); or
(ii) the sale, transfer, assignment, lease, conveyance or other
disposition, directly or indirectly, of all or substantially all the assets
of the Company and the Restricted Subsidiaries, considered as a whole
(other than a disposition of such assets as an entirety or virtually as an
entirety to a Wholly Owned Restricted Subsidiary or one or more Permitted
Holders) shall have occurred; or
81
(iii) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors (together
with any new directors whose election or appointment by such board or whose
nomination for election by the shareholders of the Company was approved by
a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute
a majority of the Board of Directors then in office; or
(iv) the shareholders of the Company shall have approved any plan
of liquidation or dissolution of the Company.
(e) The Company shall not be required to make an Offer to Purchase upon a
Change of Control Triggering Event if a third party makes the Offer to Purchase
in the manner, at the times and otherwise in compliance with the requirements
set forth in this Indenture applicable to an Offer to Purchase made by the
Company and purchases all Securities validly tendered and not withdrawn under
such Offer to Purchase.
(f) In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Section, the
Company shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this Section by
virtue thereof.
SECTION 1010. Limitation on Consolidated Debt.
-------------------------------
(a) The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, Incur any Debt, unless, after giving pro forma
effect to such Incurrence and the receipt and application of the net proceeds
thereof, no Default or Event of Default would occur as a consequence of such
Incurrence or be continuing following such Incurrence and either (i) the ratio
of (A) the aggregate consolidated principal amount (or, in the case of Debt
issued at a discount, the then-Accreted Value) of Debt of the Company
outstanding as of the most recent available quarterly or annual balance sheet,
after giving pro forma effect to the Incurrence of such Debt and any other Debt
Incurred or repaid since such balance sheet date and the receipt and application
of the net proceeds thereof, to (B) Consolidated Cash Flow Available for Fixed
Charges for the four full fiscal quarters next preceding the Incurrence of such
Debt for which consolidated financial statements are available, would be less
than 5.0 to 1.0, or (ii) the Company's Consolidated Capital Ratio as of the most
recent available quarterly or annual balance
82
sheet, after giving pro forma effect to (x) the Incurrence of such Debt and any
other Debt Incurred or repaid since such balance sheet date, (y) the issuance of
any Capital Stock (other than Disqualified Stock) of the Company since such
balance sheet date, including the issuance of any Capital Stock to be issued
concurrently with the Incurrence of such Debt, and (z) the receipt and
application of the net proceeds of such Debt or Capital Stock, as the case may
be, is less than 2.25 to 1.0.
(b) Notwithstanding the foregoing limitation, the Company or any
Restricted Subsidiary may Incur any and all of the following (each of which
shall be given independent effect):
(i) Debt under the Securities, this Indenture or any Restricted
Subsidiary Guarantee;
(ii) Debt under Credit Facilities in an aggregate principal amount
outstanding or available (together with all refinancing Debt outstanding or
available pursuant to clause (viii) below in respect of Debt previously
Incurred pursuant to this clause (ii)) at any one time not to exceed the
greater of (x) $750,000,000, which amount shall be permanently reduced by
the amount of Net Available Proceeds used to repay Debt under the Credit
Facilities, and not reinvested in Telecommunications/IS Assets or used to
purchase Securities or repay other Debt, pursuant to and as permitted by
Section 1016, and (y) 85% of the Eligible Receivables;
(iii) Purchase Money Debt, provided that the amount of such Purchase
--------
Money Debt does not exceed 100% of the cost of the construction,
installation, acquisition, lease, development or improvement of the
applicable Telecommunications/IS Assets;
(iv) Subordinated Debt of the Company; provided, however, that the
-------- -------
aggregate principal amount of such Debt, together with any other
outstanding Debt Incurred pursuant to this clause (iv), shall not exceed
$500,000,000 at any one time (which amount shall be permanently reduced by
the amount of Net Available Proceeds used to repay Subordinated Debt of the
Company, and not reinvested in Telecommunications/IS Assets or used to
purchase Securities or repay other Debt, pursuant to and as permitted by
Section 1016), except to the extent such Debt in excess of $500,000,000 (A)
is subordinated to all other Debt of the Company other than Debt Incurred
pursuant to this clause (iv) in excess of such $500,000,000 limitation, (B)
does not provide for the payment of cash interest on such Debt prior to the
Stated Maturity of the Securities and (C) (1) does not provide for payments
of principal of such Debt at stated maturity or by way of a sinking fund
applicable thereto or by way of any mandatory redemption, defeasance,
retirement or repurchase thereof by the Company (including any
83
redemption, retirement or repurchase which is contingent upon events or
circumstances, but excluding any retirement required by virtue of the
acceleration of any payment with respect to such Debt upon any event of
default thereunder), in each case on or prior to the Stated Maturity of the
Securities, and (2) does not permit redemption or other retirement
(including pursuant to an offer to purchase made by the Company) of such
Debt at the option of the holder thereof on or prior to the Stated Maturity
of the Securities;
(v) Debt outstanding on the Measurement Date;
(vi) Debt owed by the Company to any Restricted Subsidiary of the
Company or Debt owed by a Restricted Subsidiary of the Company to the
Company or a Restricted Subsidiary of the Company; provided, however, that
-------- -------
(x) upon the transfer, conveyance or other disposition by such Restricted
Subsidiary or the Company of any Debt so permitted to a Person other than
the Company or another Restricted Subsidiary of the Company or (y) if for
any reason such Restricted Subsidiary ceases to be a Restricted Subsidiary,
the provisions of this clause (vi) shall no longer be applicable to such
Debt and such Debt shall be deemed to have been Incurred by the issuer
thereof at the time of such transfer, conveyance or other disposition or
when such Restricted Subsidiary ceases to be a Restricted Subsidiary;
(vii) Debt Incurred by a Person prior to the time (A) such Person
became a Restricted Subsidiary, (B) such Person merges into or consolidates
with a Restricted Subsidiary or (C) another Restricted Subsidiary merges
into or consolidates with such Person (in a transaction in which such
Person becomes a Restricted Subsidiary), which Debt was not Incurred in
anticipation of such transaction and was outstanding prior to such
transaction;
(viii) Debt Incurred to renew, extend, refinance, defease, repay,
prepay, repurchase, redeem, retire, exchange or refund (each, a
"refinancing") Debt Incurred pursuant to clause (i), (ii), (iii), (v),
(vii) or (xii) of this paragraph (b) or this clause (viii), in an aggregate
principal amount (or if issued at a discount, the then-Accreted Value) not
to exceed the aggregate principal amount (or if issued at a discount, the
then-Accreted Value) of and accrued interest on the Debt so refinanced plus
the amount of any premium required to be paid in connection with such
refinancing pursuant to the terms of the Debt so refinanced or the amount
of any premium reasonably determined by the Board of Directors as necessary
to accomplish such refinancing by means of a tender offer or privately
negotiated repurchase, plus the expenses of the Company Incurred in
connection with such refinancing; provided,
--------
84
however, that (A) the refinancing Debt shall not be senior in right of
-------
payment to the Debt that is being refinanced and (B) in the case of any
refinancing of Debt Incurred pursuant to clause (i), (v), (vii) or (xii)
or, if such Debt previously refinanced Debt Incurred pursuant to any such
clause, this clause (viii), the refinancing Debt by its terms, or by the
terms of any agreement or instrument pursuant to which such Debt is issued,
(x) does not provide for payments of principal of such Debt at stated
maturity or by way of a sinking fund applicable thereto or by way of any
mandatory redemption, defeasance, retirement or repurchase thereof by the
Company (including any redemption, retirement or repurchase which is
contingent upon events or circumstances, but excluding any retirement
required by virtue of the acceleration of any payment with respect to such
Debt upon any event of default thereunder), in each case prior to the time
the same are required by the terms of the Debt being refinanced and (y)
does not permit redemption or other retirement (including pursuant to an
offer to purchase made by the Company) of such Debt at the option of the
holder thereof prior to the time the same are required by the terms of the
Debt being refinanced, other than, in the case of clause (x) or (y), any
such payment, redemption or other retirement at the option of the holder of
such Debt (including pursuant to an offer to purchase made by the Company)
which is conditioned upon a change of control pursuant to provisions
substantially similar to those described under Section 1009;
(ix) Debt (A) in respect of performance, surety or appeal bonds,
Guarantees, letters of credit or reimbursement obligations Incurred or
provided in the ordinary course of business securing the performance of
contractual, franchise, lease, self-insurance or license obligations and
not in connection with the Incurrence of Debt or (B) in respect of
customary agreements providing for indemnification, adjustment of purchase
price after closing, or similar obligations, or from Guarantees or letters
of credit, surety bonds or performance bonds securing any such obligations
of the Company or any of its Restricted Subsidiaries pursuant to such
agreements, Incurred in connection with the disposition of any business,
assets or 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 of the Company for the purpose of
financing such acquisition) and in an aggregate principal amount not to
exceed the gross proceeds actually received by the Company or any
Restricted Subsidiary in connection with such disposition;
(x) Debt consisting of Permitted Interest Rate or Currency
Protection Agreements;
85
(xi) Debt not otherwise permitted to be Incurred pursuant to clauses
(i) through (x) above or clause (xii) below, which, together with any other
outstanding Debt Incurred pursuant to this clause (xi), has an aggregate
principal amount not in excess of $50,000,000 at any time outstanding; and
(xii) Debt under the 9-1/8% Senior Notes, the 9-1/8% Senior Notes
Indenture or restricted subsidiary guarantees issued in accordance with the
9-1/8% Senior Notes Indenture.
(c) Notwithstanding any other provision of this Section 1010, the maximum
amount of Debt that the Company or a Restricted Subsidiary may Incur pursuant to
this Section 1010 shall not be deemed to be exceeded due solely to the result of
fluctuations in the exchange rates of currencies.
(d) For purposes of determining any particular amount of Debt under this
Section 1010, (i) Guarantees, Liens or obligations with respect to letters of
credit supporting Debt otherwise included in the determination of such
particular amount shall not be included and (ii) any Liens granted for the
benefit of the Securities pursuant to the provisions referred to in the first
paragraph of Section 1014 shall not be treated as Debt. For purposes of
determining compliance with this Section 1010, in the event that an item of Debt
meets the criteria of more than one of the types of Debt described in the above
clauses, the Company, in its sole discretion, shall classify such item of Debt
and only be required to include the amount and type of such Debt in one of such
clauses.
SECTION 1011. Limitation on Debt of Restricted Subsidiaries.
---------------------------------------------
The Company shall not permit any Restricted Subsidiary that is not a
Guarantor to Incur any Debt except any and all of the following (each of which
shall be given independent effect):
(i) Restricted Subsidiary Guarantees;
(ii) Debt outstanding on the Measurement Date;
(iii) Debt of Restricted Subsidiaries under Credit Facilities permitted to
be Incurred pursuant to clause (ii) of paragraph (b) of Section 1010;
(iv) Purchase Money Debt of Restricted Subsidiaries permitted to be
Incurred pursuant to clause (iii) of paragraph (b) of Section 1010;
(v) Debt owed by a Restricted Subsidiary to the Company or a Restricted
Subsidiary of the Company permitted to be Incurred pursuant to clause
(vi) of paragraph (b) of Section 1010;
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(vi) Debt of Restricted Subsidiaries consisting of Permitted Interest Rate
or Currency Protection Agreements permitted to be Incurred pursuant to
clause (x) of paragraph (b) of Section 1010;
(vii) Debt of Restricted Subsidiaries permitted to be Incurred under clause
(vii) of paragraph (b) of Section 1010;
(viii) Debt of Restricted Subsidiaries permitted to be Incurred under clause
(ix) or (xi) of paragraph (b) of Section 1010; and
(ix) Debt which is Incurred to refinance any Debt of a Restricted
Subsidiary permitted to be Incurred pursuant to clauses (i), (ii),
(iii), (iv) and (vii) of this paragraph or this clause (ix), in an
aggregate principal amount (or if issued at a discount, the then-
Accreted Value) not to exceed the aggregate principal amount (or if
issued at a discount, the then-Accreted Value) of the Debt so
refinanced, plus the amount of any premium required to be paid in
connection with such refinancing pursuant to the terms of the Debt so
refinanced or the amount of any premium reasonably determined by the
Board of Directors as necessary to accomplish such refinancing by
means of a tender offer or privately negotiated repurchase, plus the
amount of expenses of the Company and the applicable Restricted
Subsidiary Incurred in connection therewith; provided, however, that,
in the case of any refinancing of Debt Incurred pursuant to clause
(i), (ii) or (vii) or, if such Debt previously refinanced Debt
Incurred pursuant to any such clause, this clause (ix), the
refinancing Debt by its terms, or by the terms of any agreement or
instrument pursuant to which such Debt is Incurred, (x) does not
provide for payments of principal at the stated maturity of such Debt
or by way of a sinking fund applicable to such Debt or by way of any
mandatory redemption, defeasance, retirement or repurchase of such
Debt by the Company or any Restricted Subsidiary (including any
redemption, retirement or repurchase which is contingent upon events
or circumstances, but excluding any retirement required by virtue of
acceleration of such Debt upon an event of default thereunder), in
each case prior to the time the same are required by the terms of the
Debt being refinanced and (y) does not permit redemption or other
retirement (including pursuant to an offer to purchase made by the
Company or a Restricted Subsidiary) of such Debt at the option of the
holder thereof prior to the stated maturity of the Debt being
refinanced, other than, in the case of clause (x) or (y), any such
payment, redemption or other retirement (including pursuant to an
offer to purchase made by the Company or a
87
Restricted Subsidiary) which is conditioned upon the change of control
of the Company pursuant to provisions substantially similar to those
contained in Section 1009.
Notwithstanding any other provision of this Section 1011, the maximum
amount of Debt that a Restricted Subsidiary may Incur pursuant to this Section
1011 shall not be deemed to be exceeded due solely as the result of fluctuations
in the exchange rates of currencies.
For purposes of determining any particular amount of Debt under this
Section 1011, Guarantees, Liens or obligations with respect to letters of credit
supporting Debt otherwise included in the determination of such particular
amount shall not be included. For purposes of determining compliance with this
Section 1011, in the event that an item of Debt meets the criteria of more than
one of the types of Debt described in the above clauses, the Company, in its
sole discretion, shall classify such item of Debt and only be required to
include the amount and type of such Debt in one of such clauses.
SECTION 1012. Limitation on Restricted Payments.
---------------------------------
(a) The Company (i) shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, declare or pay any dividend, or make any
distribution, in respect of its Capital Stock or to the holders thereof,
excluding any dividends or distributions which are made solely to the Company or
a Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly
Owned Subsidiary, to the other stockholders of such Restricted Subsidiary on a
pro rata basis or on a basis that results in the receipt by the Company or a
Restricted Subsidiary of dividends or distributions of greater value than it
would receive on a pro rata basis) or any dividends or distributions payable
solely in shares of Capital Stock of the Company (other than Disqualified Stock)
or in options, warrants or other rights to acquire Capital Stock of the Company
(other than Disqualified Stock); (ii) shall not, and shall not permit any
Restricted Subsidiary to, purchase, redeem, or otherwise retire or acquire for
value (x) any Capital Stock of the Company or any Restricted Subsidiary of the
Company or (y) any options, warrants or rights to purchase or acquire shares of
Capital Stock of the Company or any Restricted Subsidiary or any securities
convertible or exchangeable into shares of Capital Stock of the Company or any
Restricted Subsidiary, except, in any such case, any such purchase, redemption
or retirement or acquisition for value (A) paid to the Company or a Restricted
Subsidiary (or, in the case of any such purchase, redemption or other retirement
or acquisition for value with respect to a Restricted Subsidiary that is not a
Wholly Owned Subsidiary, to the other stockholders of such Restricted Subsidiary
on a pro rata basis or on a basis that results in the receipt by the Company or
a Restricted Subsidiary of payments of greater value than it would receive on
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a pro rata basis) or (B) paid solely in shares of Capital Stock (other than
Disqualified Stock) of the Company; (iii) shall not make, or permit any
Restricted Subsidiary to make, any Investment (other than an Investment in the
Company or a Restricted Subsidiary or a Permitted Investment) in any Person,
including the Designation of any Restricted Subsidiary as an Unrestricted
Subsidiary, or the Revocation of any such Designation, according to Section
1019; (iv) shall not, and shall not permit any Restricted Subsidiary to, redeem,
defease, repurchase, retire or otherwise acquire or retire for value, prior to
any scheduled maturity, repayment or sinking fund payment, Debt of the Company
which is subordinate in right of payment to the Securities (other than any
redemption, defeasance, repurchase, retirement or other acquisition or
retirement for value made in anticipation of satisfying a scheduled maturity,
repayment or sinking fund obligation due within one year thereof); and (v) shall
not, and shall not permit any Restricted Subsidiary to, issue, transfer, convey,
sell or otherwise dispose of Capital Stock of any Restricted Subsidiary to a
Person other than the Company or another Restricted Subsidiary if the result
thereof is that such Restricted Subsidiary shall cease to be a Restricted
Subsidiary, in which event the amount of such "Restricted Payment" shall be the
Fair Market Value of the remaining interest, if any, in such former Restricted
Subsidiary held by the Company and the other Restricted Subsidiaries (each of
clauses (i) through (v) being a "Restricted Payment") if: (1) an Event of
Default, or an event that with the passing of time or the giving of notice, or
both, would constitute an Event of Default, shall have occurred and be
continuing, or (2) upon giving effect to such Restricted Payment, the Company
could not Incur at least $1.00 of additional Debt pursuant to paragraph (a) of
Section 1010, or (3) upon giving effect to such Restricted Payment, the
aggregate of all Restricted Payments made on or after the Measurement Date,
including Restricted Payments made pursuant to clause (A) or (B) of the proviso
at the end of this sentence, and Permitted Investments made on or after the
Measurement Date pursuant to clause (i) or (j) of the definition thereof (the
amount of any such Restricted Payment or Permitted Investment, if made other
than in cash, to be based upon Fair Market Value) exceeds the sum of: (a) 50% of
cumulative Consolidated Net Income (or, in the case that Consolidated Net Income
shall be negative, 100% of such negative amount) since the end of the last full
fiscal quarter prior to the Measurement Date through the last day of the last
full fiscal quarter ending at least 45 days prior to the date of such Restricted
Payment and (b) plus, in the case of any Revocation made after the Measurement
Date, an amount equal to the lesser of the portion (proportionate to the
Company's equity interest in the Subsidiary to which such Revocation relates) of
the Fair Market Value of the net assets of such Subsidiary at the time of
Revocation and the amount of Investments previously made (and treated as a
Restricted Payment) by the Company or any Restricted Subsidiary in such
Subsidiary; provided, however, that the Company or a Restricted Subsidiary of
-------- -------
the Company may, without regard to the limitations in clause (3) but subject to
89
clauses (1) and (2), make (A) Restricted Payments in an aggregate amount not to
exceed the sum of $50,000,000 and the aggregate net cash proceeds received after
the Measurement Date (i) as capital contributions to the Company, from the
issuance (other than to a Subsidiary or an employee stock ownership plan or
trust established by the Company or any such Subsidiary for the benefit of their
employees) of Capital Stock (other than Disqualified Stock) of the Company, and
(ii) from the issuance or sale of Debt of the Company or any Restricted
Subsidiary (other than to a Subsidiary, the Company or an employee stock
ownership plan or trust established by the Company or any such Subsidiary for
the benefit of their employees) that after the Measurement Date has been
converted into or exchanged for Capital Stock (other than Disqualified Stock) of
the Company and (B) Investments in Persons engaged in the Telecommunications/IS
Business in an aggregate amount not to exceed the after-tax gain on the sale,
after the Measurement Date, of Special Assets to the extent sold for cash, Cash
Equivalents, Telecommunications/IS Assets or the assumption of Debt of the
Company or any Restricted Subsidiary (other than Debt that is subordinated to
the Securities or any applicable Restricted Subsidiary Guarantee) and release of
the Company and all Restricted Subsidiaries from all liability on the Debt
assumed. The aggregate net cash proceeds referred to in the immediately
preceding clauses (A)(i) and (A)(ii) shall not be utilized to make Restricted
Payments pursuant to such clauses to the extent such proceeds have been utilized
to make Permitted Investments under clause (i) of the definition of "Permitted
Investments."
(b) Notwithstanding the foregoing limitation, (i) the Company may pay any
dividend on Capital Stock of any class of the Company within 60 days after the
declaration thereof if, on the date when the dividend was declared, the Company
could have paid such dividend in accordance with the foregoing provisions;
provided, however, that at the time of such payment of such dividend, no other
-------- -------
Event of Default shall have occurred and be continuing (or result therefrom);
(ii) the Company may repurchase any shares of its Common Stock or options to
acquire its Common Stock from Persons who were formerly directors, officers or
employees of the Company or any of its Subsidiaries or other Affiliates in an
amount not to exceed $3,000,000 in any 12-month period; (iii) the Company and
any Restricted Subsidiary may refinance any Debt otherwise permitted by clause
(viii) of paragraph (b) of Section 1010 or clause (ix) of Section 1011; (iv) the
Company and any Restricted Subsidiary may retire or repurchase any Capital Stock
of the Company or of any Restricted Subsidiary or any Subordinated Debt of the
Company in exchange for, or out of the proceeds of the substantially concurrent
sale (other than to a Subsidiary of the Company or an employee stock ownership
plan or trust established by the Company or any such Subsidiary for the benefit
of their employees) of, Capital Stock (other than Disqualified Stock) of the
Company, provided that the proceeds from any such exchange or sale of Capital
--------
Stock shall be excluded from any calculation pursuant to clause (A)(i) in the
90
proviso at the end of paragraph (a) above or pursuant to clause (b) of the
definition of "Invested Capital"; and (v) the Company may pay cash dividends in
any amount not in excess of $50,000,000 in any 12-month period in respect of
Preferred Stock of the Company (other than Disqualified Stock). The Restricted
Payments described in the foregoing clauses (i), (ii) and (v) shall be included
in the calculation of Restricted Payments; the Restricted Payments described in
clauses (iii) and (iv) shall be excluded in the calculation of Restricted
Payments.
SECTION 1013. Limitation on Dividend and Other Payment Restrictions
-----------------------------------------------------
Affecting Restricted Subsidiaries.
---------------------------------
(a) The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction (other than pursuant
to law or regulation) on the ability of any Restricted Subsidiary (i) to pay
dividends (in cash or otherwise) or make any other distributions in respect of
its Capital Stock owned by the Company or any other Restricted Subsidiary or pay
any Debt or other obligation owed to the Company or any other Restricted
Subsidiary, (ii) to make loans or advances to the Company or any other
Restricted Subsidiary or (iii) to transfer any of its Property to the Company or
any other Restricted Subsidiary.
(b) Notwithstanding the foregoing limitation, the Company may, and may
permit any Restricted Subsidiary to, create or otherwise cause or suffer to
exist (i) any encumbrance or restriction pursuant to any agreement in effect on
the Measurement Date, (ii) any customary (as conclusively determined in good
faith by the Chief Financial Officer of the Company) encumbrance or restriction
applicable to a Restricted Subsidiary that is contained in an agreement or
instrument governing or relating to Debt contained in any Credit Facilities or
Purchase Money Debt, provided that such encumbrances and restrictions permit the
--------
distribution of funds to the Company in an amount sufficient for the Company to
make the timely payment of interest, premium (if any) and principal (whether at
stated maturity, by way of a sinking fund applicable thereto, by way of any
mandatory redemption, defeasance, retirement or repurchase thereof, including
upon the occurrence of designated events or circumstances or by virtue of
acceleration upon an event of default, or by way of redemption or retirement at
the option of the holder of the Debt, including pursuant to offers to purchase)
according to the terms of this Indenture and the Securities and other Debt that
is solely an obligation of the Company, but provided further that such agreement
----------------
may nevertheless contain customary (as so determined) net worth, leverage,
invested capital and other financial covenants, customary (as so determined)
covenants regarding the merger of or sale of all or any substantial part of the
assets of the Company or any Restricted Subsidiary, customary (as so determined)
restrictions on transactions with affiliates and customary (as so determined)
91
subordination provisions governing Debt owed to the Company or any Restricted
Subsidiary, (iii) any encumbrance or restriction pursuant to an agreement
relating to any Acquired Debt, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person so acquired, (iv) any encumbrance or restriction pursuant to an
agreement effecting a refinancing of Debt Incurred pursuant to an agreement
referred to in clause (i), (ii) or (iii) of this paragraph (b), provided,
--------
however, that the provisions contained in such agreement relating to such
-------
encumbrance or restriction are no more restrictive (as so determined) in any
material respect than the provisions contained in the agreement the subject
thereof, (v) in the case of clause (iii) of paragraph (a) above, any encumbrance
or restriction contained in any security agreement (including a Capital Lease
Obligation) securing Debt of the Company or a Restricted Subsidiary otherwise
permitted under this Indenture, but only to the extent such restrictions
restrict the transfer of the Property subject to such security agreement, (vi)
in the case of clause (iii) of paragraph (a) above, customary provisions (A)
that restrict the subletting, assignment or transfer of any Property that is a
lease, license, conveyance or similar contract, (B) contained in asset sale or
other asset disposition agreements limiting the transfer of the Property being
sold or disposed of pending the closing of such sale or disposition or (C)
arising or agreed to in the ordinary course of business, not relating to any
Debt, and that do not, individually or in the aggregate, detract from the value
of Property of the Company or any Restricted Subsidiary in any manner material
to the Company or any Restricted Subsidiary, (vii) any encumbrance or
restriction with respect to a Restricted Subsidiary imposed pursuant to an
agreement which has been entered into for the sale or disposition of all or
substantially all of the Capital Stock or Property of such Restricted
Subsidiary, provided that the consummation of such transaction would not result
--------
in a Default or an Event of Default, that such restriction terminates if such
transaction is abandoned and that the consummation or abandonment of such
transaction occurs within one year of the date such agreement was entered into,
and (viii) any encumbrance or restriction pursuant to this Indenture and the
Securities.
SECTION 1014. Limitation on Liens
-------------------
The Company shall not, and shall not permit any Restricted Subsidiary to,
directly or indirectly, Incur or suffer to exist any Lien on or with respect to
any Property now owned or acquired after the Measurement Date to secure any Debt
without making, or causing such Restricted Subsidiary to make, effective
provision for securing the Securities (x) equally and ratably with such Debt as
to such Property for so long as such Debt will be so secured or (y) in the event
such Debt is Debt of the Company or a Guarantor which is subordinate in right of
payment to the Securities or the applicable Restricted Subsidiary Guarantee,
prior to such Debt as to such Property for so long as such Debt will be so
secured.
92
The foregoing restrictions shall not apply to: (i) Liens existing on
the Measurement Date and securing Debt outstanding on the Measurement Date or
Incurred by the Company or a Restricted Subsidiary on or after the Measurement
Date pursuant to any Credit Facility to secure Debt permitted to be Incurred by
the Company or such Restricted Subsidiary pursuant to clause (ii) of paragraph
(b) under Section 1010; (ii) Liens securing Debt in an amount which, together
with the aggregate amount of Debt then outstanding or available under all Credit
Facilities (together with all refinancing Debt then outstanding or available
pursuant to clause (viii) of paragraph (b) of Section 1010 in respect of Debt
previously Incurred under Credit Facilities), does not exceed 1.5 times the
Company's Consolidated Cash Flow Available for Fixed Charges for the four full
fiscal quarters preceding the Incurrence of such Lien for which the Company's
consolidated financial statements are available, determined on a pro forma basis
as if such Debt had been Incurred and the proceeds thereof had been applied at
the beginning of such four fiscal quarters; (iii) Liens in favor of the Company
or any Restricted Subsidiary; provided, however, that any subsequent issue or
-------- -------
transfer of Capital Stock or other event that results in any such Restricted
Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of
the Debt secured by any such Lien (except to the Company or a Restricted
Subsidiary) shall be deemed, in each case, to constitute the Incurrence of such
Lien by the issuer thereof; (iv) Liens Incurred by the Company or a Restricted
Subsidiary to secure Purchase Money Debt permitted to be Incurred by the Company
or such Restricted Subsidiary pursuant to clause (iii) of paragraph (b) under
Section 1010, provided that any such Lien may not extend to any Property other
--------
than the Telecommunications/IS Assets installed, constructed, acquired, leased,
developed or improved with the proceeds of such Purchase Money Debt and any
improvements or accessions thereto (it being understood that all Debt to any
single lender or group of related lenders or outstanding under any single credit
facility, and in any case relating to the same group or collection of
Telecommunications/IS Assets financed thereby, shall be considered a single
Purchase Money Debt, whether drawn at one time or from time to time); (v) Liens
to secure Acquired Debt, provided that (a) such Lien attaches to the acquired
--------
Property prior to the time of the acquisition of such Property and (b) such Lien
does not extend to or cover any other Property; (vi) Liens to secure Debt
Incurred to refinance, in whole or in part, Debt secured by any Lien referred to
in the foregoing clauses (i), (iv) and (v) or this clause (vi) so long as such
Lien does not extend to any other Property (other than improvements and
accessions to the original Property) and the principal amount of Debt so secured
is not increased except as otherwise permitted under clause (viii) of paragraph
(b) of Section 1010 or clause (ix) of Section 1011; (vii) Liens not otherwise
permitted by the foregoing clauses (i) through (vi) securing Debt in an
aggregate amount not to exceed 5% of the Company's Consolidated Tangible Assets;
(viii) Liens granted after the Issue Date pursuant to
93
this Section 1014 to secure the Securities; and (ix) Permitted Liens.
SECTION 1015. Limitation on Sale and Leaseback Transactions.
---------------------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, enter into, assume, Guarantee or otherwise become
liable with respect to any Sale and Leaseback Transaction, unless (i) the
Company or such Restricted Subsidiary would be entitled to Incur (a) Debt in an
amount equal to the Attributable Value of the Sale and Leaseback Transaction
pursuant to Section 1010 and (b) a Lien pursuant to Section 1014, equal in
amount to the Attributable Value of the Sale and Leaseback Transaction, without
also securing the Securities, and (ii) the Sale and Leaseback Transaction is
treated as an Asset Disposition and all of the conditions of Section 1016
(including the provisions concerning the application of Net Available Proceeds)
are satisfied with respect to such Sale and Leaseback Transaction, treating all
of the consideration received in such Sale and Leaseback Transaction as Net
Available Proceeds for purposes of such Section 1015.
SECTION 1016. Limitation on Asset Dispositions.
--------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, make any Asset Disposition unless: (i) the Company or the Restricted
Subsidiary, as the case may be, receives consideration for such disposition at
least equal to the Fair Market Value for the Property sold or disposed of as
determined by the Board of Directors in good faith and evidenced by a Board
Resolution filed with the Trustee; and (ii) at least 75% of the consideration
for such disposition consists of cash or Cash Equivalents or the assumption of
Debt of the Company or any Restricted Subsidiary (other than Debt that is
subordinated to the Securities or any applicable Restricted Subsidiary
Guarantee) and release of the Company and all Restricted Subsidiaries from all
liability on the Debt assumed (or if less than 75%, the remainder of such
consideration consists of Telecommunications/IS Assets); provided, however,
-------- -------
that, to the extent such disposition involves Special Assets, all or any portion
of the consideration may, at the Company's election, consist of Property other
than cash, Cash Equivalents, the assumption of Debt or Telecommunications/IS
Assets.
The Net Available Proceeds (or any portion thereof) from Asset
Dispositions may be applied by the Company or a Restricted Subsidiary, to the
extent the Company or such Restricted Subsidiary elects (or is required by the
terms of any Debt): (1) to the permanent repayment or reduction of Debt then
outstanding under any Credit Facility, to the extent such Credit Facility would
require such application or prohibit payments pursuant to the Offer to Purchase
described in the following paragraph (other than Debt owed to the Company or any
Affiliate of the Company);
94
or (2) to reinvest in Telecommunications/IS Assets (including by means of an
Investment in Telecommunications/IS Assets by a Restricted Subsidiary with Net
Available Proceeds received by the Company or another Restricted Subsidiary).
Any Net Available Proceeds from an Asset Disposition not applied in
accordance with the preceding paragraph within 360 days (or, in the case of a
disposition of Special Assets identified in clause (a) of the definition thereof
in which the Net Available Proceeds exceed $500,000,000, 540 days) from the date
of the receipt of such Net Available Proceeds shall constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $10,000,000, the
Company will be required to make an Offer to Purchase with such Excess Proceeds
on a pro rata basis according to principal amount (or, in the case of Debt
issued at a discount, the then-Accreted Value) for (x) Outstanding Securities at
a price in cash equal to 100% of the Accreted Value of the Securities on the
purchase date plus accrued and unpaid interest (if any) thereon (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date) and (y) any other Debt of the Company or
any Guarantor that is pari passu with the Securities, or any Debt of a
---- -----
Restricted Subsidiary that is not a Guarantor, at a price no greater than 100%
of the principal amount thereof plus accrued and unpaid interest (if any) to the
purchase date (or 100% of the then-Accreted Value plus accrued and unpaid
interest (if any) to the purchase date in the case of original issue discount
Debt), to the extent, in the case of this clause (y), required under the terms
thereof (other than Debt owed to the Company or any Affiliate of the Company).
To the extent there are any remaining Excess Proceeds following the completion
of the Offer to Purchase, the Company shall apply such Excess Proceeds to the
repayment of other Debt of the Company or any Restricted Subsidiary, to the
extent permitted or required under the terms thereof. Any other remaining Excess
Proceeds may be applied to any use as determined by the Company which is not
otherwise prohibited by this Indenture, and the amount of Excess Proceeds shall
be reset to zero.
The Company and the Trustee shall perform their respective obligations
for the Offer to Purchase as specified in the Offer. Prior to the Purchase Date,
the Company shall (i) accept for payment Securities or portions thereof tendered
pursuant to the Offer, (ii) irrevocably deposit with the Paying Agent (or, if
the Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) money sufficient to pay the Purchase Price of all
Securities or portions thereof so accepted (provided that such deposit may be
made no later than 11:00 A.M. New York City time on the Purchase Date if the
Company elects) and (iii) deliver or cause to be delivered to the Trustee all
Securities so accepted together with an Officers' Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent shall promptly mail or deliver to Holders of Securities so accepted
payment in an amount equal
95
to the Purchase Price, and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security or Securities equal in principal amount
at maturity to any unpurchased portion of the principal amount at maturity of
the Security surrendered as requested by the Holder. Any Security not accepted
for payment shall be promptly mailed or delivered by the Company to the Holder
thereof. In the event that the aggregate Purchase Price is less than the amount
delivered by the Company to the Trustee or the Paying Agent, the Trustee or the
Paying Agent, as the case may be, shall deliver the excess to the Company
immediately after the Purchase Date.
Not later than the date upon which written notice of an Offer to
Purchase is delivered to the Trustee, the Company shall deliver to the Trustee
an Officers' Certificate as to (i) the amount of the Offer, (ii) the allocation
of the Net Available Proceeds from the Asset Disposition pursuant to which such
Offer is being made and (iii) the compliance of such allocation with the
provisions of this Section 1016.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Section, the
Company shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this Section by
virtue thereof.
SECTION 1017. Limitation on Issuance and Sales of Capital Stock of
----------------------------------------------------
Restricted Subsidiaries.
-----------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, issue, transfer, convey, sell or otherwise dispose of any shares of Capital
Stock of a Restricted Subsidiary or securities convertible or exchangeable into,
or options, warrants, rights or any other interest with respect to, Capital
Stock of a Restricted Subsidiary to any Person other than the Company or a
Restricted Subsidiary except (i) a sale of all of the Capital Stock of such
Restricted Subsidiary owned by the Company and any Restricted Subsidiary that
complies with the provisions of Section 1016 to the extent such provisions
apply, (ii) in a transaction that results in such Restricted Subsidiary becoming
a Joint Venture, provided (x) such transaction complies with the provisions of
--------
Section 1016 to the extent such provisions apply and (y) the remaining interest
of the Company or any other Restricted Subsidiary in such Joint Venture would
have been permitted as a new Restricted Payment or Permitted Investment under
the provisions of Section 1012, (iii) the issuance, transfer, conveyance, sale
or other disposition of shares of such Restricted Subsidiary so long as after
giving effect to such transaction such Restricted Subsidiary remains a
Restricted Subsidiary and such transaction complies with the provisions of
96
Section 1016 to the extent such provisions apply, (iv) the transfer, conveyance,
sale or other disposition of shares required by applicable law or regulation,
(v) if required, the issuance, transfer, conveyance, sale or other disposition
of directors' qualifying shares, (vi) Disqualified Stock issued in exchange for,
or upon conversion of, or the proceeds of the issuance of which are used to
refinance, shares of Disqualified Stock of such Restricted Subsidiary, provided
--------
that the amounts of the redemption obligations of such Disqualified Stock shall
not exceed the amounts of the redemption obligations of, and such Disqualified
Stock shall have redemption obligations no earlier than those required by, the
Disqualified Stock being exchanged, converted or refinanced, (vii) in a
transaction where the Company or a Restricted Subsidiary acquires at the same
time not less than its Proportionate Interest in such issuance of Capital Stock,
(viii) Capital Stock issued and outstanding on the Measurement Date, (ix)
Capital Stock of a Restricted Subsidiary issued and outstanding prior to the
time that such Person becomes a Restricted Subsidiary so long as such Capital
Stock was not issued in contemplation of such Person's becoming a Restricted
Subsidiary or otherwise being acquired by the Company and (x) an issuance of
Preferred Stock of a Restricted Subsidiary (other than Preferred Stock
convertible or exchangeable into Common Stock of any Restricted Subsidiary)
otherwise permitted by this Indenture. In the event of (a) the consummation of a
transaction referred to in any of the foregoing clauses that results in a
Guarantor no longer being a Restricted Subsidiary and (b) the execution and
delivery of a supplemental indenture providing for such release in form
satisfactory to the Trustee, any such Guarantor shall be released from all its
obligations under its Restricted Subsidiary Guarantee.
SECTION 1018. Transactions with Affiliates.
----------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, sell, lease, transfer, or otherwise
dispose of any of its Property to, or purchase any Property from, or enter into
any contract, agreement, understanding, loan, advance, Guarantee or transaction
(including the rendering of services) with or for the benefit of, any Affiliate
(each of the foregoing, an "Affiliate Transaction"), unless (a) such Affiliate
Transaction or series of Affiliate Transactions is (i) in the best interest of
the Company or such Restricted Subsidiary and (ii) on terms that are no less
favorable to the Company or such Restricted Subsidiary than those that would
have been obtained in a comparable arm's-length transaction by the Company or
such Restricted Subsidiary with a Person that is not an Affiliate (or, in the
event that there are no comparable transactions involving Persons who are not
Affiliates of the Company or the relevant Restricted Subsidiary to apply for
comparative purposes, is otherwise on terms that, taken as a whole, the Company
has determined to be fair to the Company or the relevant Restricted Subsidiary)
and (b) the Company delivers to the Trustee (i) with respect to any Affiliate
97
Transaction or series of Affiliate Transactions involving aggregate payments in
excess of $10,000,000 but less than $15,000,000, a certificate of the chief
executive, operating or financial officer of the Company evidencing such
officer's determination that such Affiliate Transaction or series of Affiliate
Transactions complies with clause (a) above and (ii) with respect to any
Affiliate Transaction or series of Affiliate Transactions involving aggregate
payments equal to or in excess of $15,000,000, a Board Resolution certifying
that such Affiliate Transaction or series of Affiliate Transactions complies
with clause (a) above and that such Affiliate Transaction or series of Affiliate
Transactions has been approved by the Board of Directors, including a majority
of the disinterested members of the Board of Directors, provided that, in the
--------
event that there shall not be at least two disinterested members of the Board of
Directors with respect to the Affiliate Transaction, the Company shall, in
addition to such Board Resolution, file with the Trustee a written opinion from
an investment banking firm of national standing in the United States which, in
the good faith judgment of the Board of Directors, is independent with respect
to the Company and its Affiliates and qualified to perform such task, which
opinion shall be to the effect that the consideration to be paid or received in
connection with such Affiliate Transaction is fair, from a financial point of
view, to the Company or such Restricted Subsidiary.
Notwithstanding the foregoing, the following shall not be deemed
Affiliate Transactions: (i) any employment agreement entered into by the Company
or any of its Restricted Subsidiaries in the ordinary course of business and
consistent with industry practice; (ii) any agreement or arrangement with
respect to the compensation of a director or officer of the Company or any
Restricted Subsidiary approved by a majority of the disinterested members of the
Board of Directors and consistent with industry practice; (iii) transactions
between or among the Company and its Restricted Subsidiaries, provided that no
--------
more than 5% of the Voting Stock (on a fully diluted basis) of any such
Restricted Subsidiary is owned by an Affiliate of the Company (other than a
Restricted Subsidiary); (iv) Restricted Payments and Permitted Investments
permitted by Section 1012 (other than Investments in Affiliates that are not the
Company or Restricted Subsidiaries); (v) transactions pursuant to the terms of
any agreement or arrangement as in effect on the Measurement Date; and (vi)
transactions with respect to wireline or wireless transmission capacity, the
lease or sharing or other use of cable or fiber optic lines, equipment,
rights-of-way or other access rights, between the Company (or any Restricted
Subsidiary) and any other Person, provided that, in the case of this clause
--------
(vi), such transaction complies with clause (a) in the immediately preceding
paragraph.
98
SECTION 1019. Limitation on Designations of Unrestricted Subsidiaries.
-------------------------------------------------------
The Company shall not designate any Subsidiary of the Company (other
than a newly created Subsidiary in which no Investment has previously been made)
as an "Unrestricted Subsidiary" under this Indenture (a "Designation") unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such Designation;
(b) immediately after giving effect to such Designation, the Company
would be able to Incur $1.00 of Debt under paragraph (a) of Section 1010;
and
(c) the Company would not be prohibited under any provision of this
Indenture from making an Investment at the time of Designation (assuming
the effectiveness of such Designation) in an amount (the "Designation
Amount") equal to the portion (proportionate to the Company's equity
interest in such Restricted Subsidiary) of the Fair Market Value of the net
assets of such Restricted Subsidiary on such date.
In the event of any such Designation, the Company shall be deemed to
have made an Investment constituting a Restricted Payment pursuant to Section
1012 for all purposes of this Indenture in the Designation Amount; provided,
--------
however, that, upon a Revocation of any such Designation of a Subsidiary, the
-------
Company shall be deemed to continue to have a permanent "Investment" in an
Unrestricted Subsidiary of an amount (if positive) equal to (i) the Company's
"Investment" in such Subsidiary at the time of such Revocation less (ii) the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of such Subsidiary at the time of such
Revocation. At the time of any Designation of any Subsidiary as an Unrestricted
Subsidiary, such Subsidiary shall not own any Capital Stock of the Company or
any Restricted Subsidiary. In addition, neither the Company nor any Restricted
Subsidiary shall at any time (x) provide credit support for, or a Guarantee of,
any Debt of any Unrestricted Subsidiary (including any undertaking, agreement or
instrument evidencing such Debt); provided that the Company or a Restricted
--------
Subsidiary may pledge Capital Stock or Debt of any Unrestricted Subsidiary on a
nonrecourse basis such that the pledgee has no claim whatsoever against the
Company other than to obtain such pledged Capital Stock or Debt, (y) be directly
or indirectly liable for any Debt of any Unrestricted Subsidiary or (z) be
directly or indirectly liable for any Debt which provides that the holder
thereof may (upon notice, lapse of time or both) declare a default thereon or
cause the payment thereof to be accelerated or payable prior to its final
scheduled maturity upon the occurrence of a default with respect to any Debt,
Lien or
99
other obligation of any Unrestricted Subsidiary (including any right to take
enforcement action against such Unrestricted Subsidiary), except in the case of
clause (x) or (y) to the extent permitted under Sections 1012 and 1018.
Unless Designated as an Unrestricted Subsidiary, any Person that becomes a
Subsidiary of the Company will be classified as a Restricted Subsidiary;
provided, however, that such Subsidiary shall not be designated as a Restricted
-------- -------
Subsidiary and shall be automatically classified as an Unrestricted Subsidiary
if either of the requirements set forth in clauses (a) and (b) of the
immediately following paragraph will not be satisfied immediately following such
classification. Except as provided in the first sentence of this Section 1019,
no Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary.
A Designation may be revoked (a "Revocation") by a Board Resolution
delivered to the Trustee, provided that the Company will not make any Revocation
--------
unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of and after giving effect to such Revocation; and
(b) all Liens and Debt of such Unrestricted Subsidiary outstanding
immediately following such Revocation would, if Incurred at such time, have
been permitted to be Incurred at such time for all purposes of this
Indenture.
All Designations and Revocations must be evidenced by Board Resolutions
delivered to the Trustee (i) certifying compliance with the foregoing provisions
and (ii) giving the effective date of such Designation or Revocation, such
delivery to the Trustee to occur within 45 days after the end of the fiscal
quarter of the Company in which such Designation or Revocation is made (or, in
the case of a Designation or Revocation made during the last fiscal quarter of
the Company's fiscal year, within 90 days after the end of such fiscal year).
Upon Designation of a Restricted Subsidiary as an Unrestricted Subsidiary in
compliance with this Section 1019, such Restricted Subsidiary shall, by delivery
of a supplemental indenture providing for such release in form satisfactory to
the Trustee, be released from any Restricted Subsidiary Guarantee previously
made by such Subsidiary.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption.
-------------------
The Securities will be subject to redemption at the option of the Company,
in whole or in part, at any time or from time to time, upon not less than 30 nor
more than 60 days' prior notice, on the terms and at the redemption prices
(expressed as
100
percentages of Accreted Value) set forth in the second and third paragraphs on
the reverse of the form of Security, plus accrued and unpaid interest thereon
(if any) to the Redemption Date (subject to the right of Holders of record on
the relevant record date to receive interest due on the relevant interest
payment date).
SECTION 1102. Applicability of Article.
------------------------
This Article shall govern any redemption of the Securities pursuant to
Section 1101.
SECTION 1103. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities pursuant to Section
1101 shall be evidenced by a Board Resolution. The Company shall, at least 60
days prior to the Redemption Date fixed by the Company (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date and of the Accreted Value of Securities to be redeemed and shall deliver to
the Trustee such documentation and records as shall enable the Trustee to select
the Securities to be redeemed pursuant to Section 1104. Such notice shall be
accompanied by an Officers' Certificate and an Opinion of Counsel from the
Company to the effect that such redemption will comply with the conditions
herein.
SECTION 1104. Selection by Trustee of Securities to Be Redeemed.
-------------------------------------------------
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, in compliance with the requirements of the principal
national securities exchange, if any, on which the Securities are listed, or, if
the Securities are not so listed, on a pro rata basis, by lot or by such other
method as the Trustee shall deem fair and appropriate and which may provide for
the selection for redemption of portions of the Accreted Value of Securities;
provided, however, that no such partial redemption shall reduce the portion of
-------- -------
the principal amount at maturity of a Security not redeemed to less than $1,000.
The Trustee shall promptly notify the Company in writing of the Securities
selected for redemption and, in the case of any Securities selected for partial
redemption, the principal amount at maturity thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to redemption of Securities shall relate, in the case of
any Security redeemed or to be redeemed only in part, to the portion of the
Accreted Value of such Security which has been or is to be redeemed.
101
SECTION 1105. Notice of Redemption.
--------------------
Notice of redemption shall be given in the manner provided for in Section
106 not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Securities to be redeemed.
Each notice of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price and the amount of accrued interest to the
Redemption Date payable as provided in Section 1107, if any,
(3) if less than all Outstanding Securities are to be redeemed, the
identification (and, in the case of a partial redemption, the principal amounts
at maturity) of the particular Securities to be redeemed,
(4) in case any Security is to be redeemed in part only, that on and after
the Redemption Date, upon surrender of such Security, the Holder will receive,
without charge, a new Security or Securities of authorized denominations for the
Accreted Value thereof remaining unredeemed,
(5) that on the Redemption Date the Redemption Price (and unpaid and
accrued interest, if any, to the Redemption Date payable as provided in Section
1107) will become due and payable upon each such Security, or the portion
thereof, to be redeemed, and that, unless the Company defaults in making such
redemption payment or the Trustee or the Paying Agent is prohibited from making
such payment, interest thereon will cease to accrue on and after said date, and
(6) the place or places where such Securities are to be presented and
surrendered for payment of the Redemption Price and accrued interest, if any.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1106. Deposit of Redemption Price.
---------------------------
On or prior to any Redemption Date (and if on any Redemption Date, before
11:00 A.M. New York City time, on such date), the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and unpaid and accrued interest
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant
102
interest payment date) on, all the Securities which are to be redeemed on that
date.
SECTION 1107. Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified (together with unpaid and accrued interest,
if any, to the Redemption Date), and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest or the Trustee or the Paying Agent shall be prohibited from making such
payment) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with unpaid and accrued
interest, if any, to the Redemption Date; provided, however, that installments
-------- -------
of interest whose Stated Maturity is on or prior to the Redemption Date shall be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Record
Dates according to their terms and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the Accreted Value (and premium, if any) shall, until
paid, bear interest from the Redemption Date at the rate borne by the
Securities.
SECTION 1108. Securities Redeemed in Part.
---------------------------
Any Security which is to be redeemed only in part shall be surrendered at
the office or agency of the Company maintained for such purpose pursuant to
Section 1002 (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or Securities, of any authorized denomination as requested by
such Holder, in aggregate Accreted Value equal to and in exchange for the
unredeemed portion of the Accreted Value of the Security so surrendered.
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. Company's Option to Effect Defeasance or Covenant Defeasance.
------------------------------------------------------------
The Company may, at its option by Board Resolution, at any time, with
respect to the Securities, elect to have either Section 1202 or Section 1203 be
applied to all Outstanding
103
Securities upon compliance with the conditions set forth below in this Article
Twelve.
SECTION 1202. Defeasance and Discharge.
------------------------
Upon the Company's exercise under Section 1201 of the option applicable to
this Section 1202, the Company shall be deemed to have been discharged from its
obligations with respect to all Outstanding Securities on the date the
conditions set forth in Section 1204 are satisfied (hereinafter, "defeasance").
For this purpose, such defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding
Securities, which shall thereafter be deemed to be "Outstanding" only for the
purposes of Section 1205 and the other Sections of this Indenture referred to in
clauses (A) and (B) below, and to have satisfied all its other obligations under
such Securities and this Indenture insofar as such Securities are concerned (and
the Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the Company's obligations with
respect to such Securities under Sections 304, 305, 306, 1002 and 1003 and the
Company's rights under Section 1101, (B) rights of Holders to receive payment of
Accreted Value of, premium, if any, and interest on such Securities (but not the
Purchase Price referred to under Section 1009 or 1016) and any rights of the
Holders with respect to such amounts, (C) the rights, obligations and immunities
of the Trustee under the Indenture and (D) this Article Twelve. Subject to
compliance with this Article Twelve, the Company may exercise its option under
this Section 1202 notwithstanding the prior exercise of its option under Section
1203 with respect to the Securities. If the Company exercises its option under
this Section 1202, each Guarantor, if any, shall be released from all its
obligations under its Restricted Subsidiary Guarantee.
SECTION 1203. Covenant Defeasance.
-------------------
Upon the Company's exercise under Section 1201 of the option applicable to
this Section 1203, the Company shall be released from its obligations under any
covenant contained in Sections 801(3), (4) and (5), in Sections 803, 1005, 1006
and 1007 and Sections 1009 through 1019 and from the operation of Sections
501(6), (7), (8), (9) and (10) (but, in the case of Sections 501(9) and (10),
with respect only to Significant Subsidiaries), with respect to the Outstanding
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "covenant defeasance"), and the Securities shall thereafter be
deemed not to be "Outstanding" for the purposes of any direction, waiver,
consent, declaration or other Act of Holders (and the consequences of any
thereof) in connection with such provisions, but shall continue to be deemed
"Outstanding" for all other purposes hereunder. For this purpose, such covenant
defeasance means that, with respect to the Outstanding Securities, the
104
Company may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such provision, whether directly
or indirectly, by reason of any reference elsewhere herein to any such provision
or by reason of any reference in any such provision to any other provision
herein or in any other document and such omission to comply shall not constitute
a Default or an Event of Default under Section 501(3), (4), (5), (6), (7), (8),
(9) or (10) (but, in the case of Section 501(9) or (10), with respect only to
Significant Subsidiaries) but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby. If the Company
exercises its option under this Section 1203, each Guarantor, if any, shall be
released from all its obligations under its Restricted Subsidiary Guarantee.
SECTION 1204. Conditions to Defeasance or Covenant Defeasance.
-----------------------------------------------
The following shall be the conditions to application of either Section 1202
or Section 1203 to the Outstanding Securities:
(1) The Company shall irrevocably have deposited or caused to be deposited
with the Trustee (or another trustee satisfying the requirements of Section 608
who shall agree to comply with the provisions of this Article Twelve applicable
to it) as trust funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit of
the Holders of such Securities, at any time prior to the Maturity of the
Securities: (A) money in an amount, or (B) Government Securities which through
the payment of interest and principal will provide, not later than one day
before the due date of payment in respect of the Securities, money in an amount,
or (C) a combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge the
Accreted Value of (and premium, if any, on) and interest on, the Outstanding
Securities on the Stated Maturity (or Redemption Date, if applicable); provided
that the Trustee (or such other trustee) shall have been irrevocably instructed
in writing to apply such money or the proceeds of such Government Securities to
said payments with respect to the Securities. Before such a deposit, the Company
may give to the Trustee, in accordance with Section 1103, a notice of its
election to redeem all of the Outstanding Securities at a future date in
accordance with Article Eleven, which notice shall be irrevocable. Such
irrevocable redemption notice, if given, shall be given effect in applying the
foregoing.
(2) No Default or Event of Default with respect to the Securities shall
have occurred and be continuing on the date of such deposit or, insofar as
paragraphs (9) and (10) of Section 501 are concerned with respect to the
Company, at any
105
time during the period ending on the 123rd day after the date of such deposit
(it being understood that this condition shall not be deemed satisfied until the
expiration of such period).
(3) Such defeasance or covenant defeasance shall not result in a breach or
violation of, or constitute a default under, this Indenture or any other
agreement or instrument to which the Company is a party or by which it is bound.
(4) In the case of an election under Section 1202, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (x) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling, or (y) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the Outstanding
Securities will not recognize income, gain or loss for federal income tax
purposes as a result of such defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would have
been the case if such defeasance had not occurred.
(5) In the case of an election under Section 1203, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders of
the Outstanding Securities will not recognize income, gain or loss for federal
income tax purposes as a result of such covenant defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not occurred.
(6) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section 1202 or
the covenant defeasance under Section 1203 (as the case may be) have been
complied with.
(7) The Company shall have delivered to the Trustee an Opinion of Counsel
acceptable to the Trustee to the effect that such defeasance will not result in
the trust relating thereto or the Trustee being subject to regulation under the
Investment Company Act of 1940.
SECTION 1205. Deposited Money and Government Securities to Be Held in
-------------------------------------------------------
Trust; Other Miscellaneous Provisions.
-------------------------------------
Subject to the provisions of the last paragraph of Section 1003, all money
and Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this Section
1205, the "Trustee") pursuant to Section 1204 in respect of the Outstanding
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying
106
Agent (including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities of all sums due and to become due
thereon in respect of Accreted Value, premium, if any, and interest, but such
money need not be segregated from other funds except to the extent required by
law or to the extent the Company acts as its own Paying Agent.
The Company shall pay and indemnify the Trustee and (if applicable) its
officers, directors, employees and agents against any tax, fee or other charge
imposed on or assessed against the Government Securities deposited pursuant to
Section 1204 or the principal and interest received in respect thereof other
than any such tax, fee or other charge which by law is for the account of the
Holders of the Outstanding Securities.
Anything in this Article Twelve to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or Government Securities held by it as provided in Section
1204 which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent defeasance or covenant defeasance, as
applicable, in accordance with this Article Twelve.
SECTION 1206. Reinstatement.
-------------
If the Trustee or any Paying Agent is unable to apply any money in
accordance with Section 401 or 1205 by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's and any Guarantor's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 401, 1202 or 1203, as the case may be,
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance therewith; provided, however, that if the Company or any
-------- -------
Guarantor makes any payment of Accreted Value of, premium, if any, or interest
on any Security following the reinstatement of its obligations, the Company or
such Guarantor shall be subrogated to the rights of the Holders of such
Securities to receive such payment from the money held by the Trustee or Paying
Agent.
107
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
XXXXX 0 COMMUNICATIONS, INC.
By:
/s/ R. XXXXXXX XXXXXXXX
--------------------------
Name: R. Xxxxxxx Xxxxxxxx
Title: Executive Vice
President and Chief
Financial Officer
Attest:
/s/ XXXXXX X. XXXXXX
---------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President and
General Counsel
IBJ XXXXXXXX BANK & TRUST COMPANY, as Trustee
By:
/s/ XXXX XXXXX
--------------------------
Name: Xxxx Xxxxx
Title: Assistant Vice
President
Attest:
/s/ XXXXX XXXXXXXXX
---------------------------
Name: Xxxxx Xxxxxxxxx
Title: Assistant Vice President
108
EXHIBIT A
Form of Face of Security
------------------------
[If a Global Security, then insert:] THIS SECURITY IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY.
THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY
(OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A
NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
[If a Global Security, then insert:] UNLESS THIS CERTIFICATE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[Private Placement Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF THE
ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS
AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE
DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG
AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS
A-1
SECURITY), PROVIDED THAT, IF SUCH TRANSFER IS BEING EFFECTED BY CERTAIN
TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED BELOW) PRIOR TO THE DATE THAT
IS 40 DAYS FOLLOWING THE ISSUE DATE, A CERTIFICATE THE FORM OF WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED BY THE TRANSFEREE TO THE
COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR"
AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT
PURPOSES AND NOT FOR DISTRIBUTION, AND A CERTIFICATE THE FORM OF WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED BY THE TRANSFEREE TO THE
COMPANY AND THE TRUSTEE (PROVIDED THAT CERTAIN TRANSFERORS SPECIFIED IN THE
INDENTURE MAY NOT TRANSFER THIS SECURITY PURSUANT TO THIS CLAUSE (4) PRIOR TO
THE DATE THAT IS 40 DAYS FOLLOWING THE ISSUE DATE), (5) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE)
UNDER THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. AN INSTITUTIONAL ACCREDITED
INVESTOR HOLDING THIS SECURITY AGREES IT WILL FURNISH TO THE COMPANY AND THE
TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE
TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A OR (2) AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND
NOT FOR DISTRIBUTION OR (3) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (o)(2) OF
RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT.
[If a Physical Security, then insert:] IN CONNECTION WITH ANY TRANSFER, THE
HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND
OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT
THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.
A-2
LEVEL 3 COMMUNICATIONS, INC.
10-1/2% Senior Discount Note Due 2008
CUSIP No.
No. [if a Global security, insert: up to] $
Xxxxx 0 Xxxxxxxxxxxxxx, Xxx., a Delaware corporation (herein called the
"Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
_____________, or registered assigns, the principal sum of [if a Global
Security, then insert: up to] _________ Dollars [if a Global Security, then
insert: (the outstanding principal amount at maturity of which shall be
reflected in the attached Schedule of Increases or Decreases in Global Security
and the records of the Trustee which, taken together with the outstanding
principal amounts at maturity of all other Outstanding Securities, shall not
exceed $833,815,000 in the aggregate at any time)] on December 1, 2008, at the
office or agency of the Company referred to below, and to pay interest thereon,
in cash in arrears semiannually on June 1 and December 1 in each year, with
payment commencing on June 1, 2004, and cash interest accruing from December 1,
2003, or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, at the rate of 10-1/2% per annum, until the principal
amount at maturity hereof is paid or duly provided for; provided that no cash
interest shall accrue on the Accreted Value of this Security prior to December
1, 2003, and no cash interest shall be paid on this Security prior to June 1,
2004, except [delete text in brackets if an Exchange Security (other than a
Private Exchange Security): (a) as provided in the next paragraph and (b)] that
the Company may elect, upon not less than 60 days prior notice given in the
manner provided for in the Indenture, to commence the accrual of cash interest
(at the rate shown above) on all Outstanding Securities on or after December 1,
2001, in which case the outstanding principal amount at maturity of this
Security shall on such commencement date be reduced to the Accreted Value of
this Security as of such commencement date and cash interest shall be payable
with respect to this Security on each June 1 and December 1 thereafter. The
Company shall pay interest on overdue Accreted Value at the rate borne by the
Securities, and it shall pay interest on overdue installments of interest at the
same rate to the extent lawful.
[Delete this paragraph if an Exchange Security (other than a Private Exchange
Security).] The Holder of this Security is entitled to the benefits of a
Registration Agreement, dated as of November 24, 1998, between the Company and
the Purchasers named therein (the "Registration Agreement"). Capitalized terms
used in this paragraph but not defined herein have the meanings assigned to them
in the Registration Agreement. In the event that (i) neither the Exchange Offer
Registration Statement nor the Shelf Registration Statement has been filed with
the Commission on or prior to the 90th day following the date of the original
issuance of the Securities, (ii) neither the Exchange
A-3
Offer Registration Statement nor the Shelf Registration Statement has been
declared effective on or prior to the 150th day following the date of the
original issuance of the Securities, (iii) neither the Registered Exchange Offer
has been consummated nor the Shelf Registration Statement has been declared
effective on or prior to the 180th day following the date of the original
issuance of the Securities, or (iv) after the Shelf Registration Statement has
been declared effective, such Registration Statement thereafter ceases to be
effective or usable in connection with resales of the Securities at any time
that the Company is obligated to maintain the effectiveness thereof pursuant to
the Registration Agreement (each such event referred to in clauses (i) through
(iv) above being referred to herein as a "Registration Default"), interest (the
"Special Interest") shall accrue (in addition to stated interest, if any, on the
Securities) from and including the date on which the first such Registration
Default shall occur to but excluding the date on which all Registration Defaults
have been cured, at a rate per annum equal to 0.50% of the Accreted Value of the
Securities; provided, however, that such rate per annum shall increase by 0.25%
-------- -------
per annum from and including the 91st day after the first such Registration
Default (and each successive 91st day thereafter) unless and until all
Registration Defaults have been cured; provided further, however, that in no
---------------- -------
event shall the Special Interest accrue at a rate in excess of 1.00% per annum.
Accrued Special Interest, if any, shall be paid in cash in arrears semiannually
on June 1 and December 1 in each year; and the amount of accrued Special
Interest shall be determined on the basis of the number of days actually elapsed
and the Accreted Value for each such day. Any accrued and unpaid interest
(including Special Interest) on this Security upon the issuance of an Exchange
Security in exchange for this Security shall cease to be payable to the Holder
hereof but such accrued and unpaid interest (including Special Interest) shall
be payable on the next Interest Payment Date for such Exchange Security to the
Holder thereof on the related Regular Record Date.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the May 15 or November 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for shall forthwith cease to be
payable to the Holder on such Regular Record Date, and such defaulted interest,
and (to the extent lawful) interest on such defaulted interest at the rate borne
by the Securities, may be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or may
A-4
be paid at any time in any other lawful manner, all as more fully provided in
said Indenture. Payment of the Accreted Value of (and premium, if any) and
interest on this Security will be made at the office or agency of the Company
maintained for that purpose in The City of New York, or at such other office or
agency of the Company as may be maintained for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that payment
-------- -------
of interest may be made at the option of the Company by check mailed to the
address of the Person entitled thereto as such address shall appear on the
Security Register.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture, or be valid or
obligatory for any purpose.
A-5
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: LEVEL 3 COMMUNICATIONS, INC.
---------------------------
By:
---------------------------
Authorized Signatory
Attest:
---------------------------
A-6
Form of Reverse of Security
---------------------------
This Security is one of a duly authorized issue of securities of the
Company designated as its 10-1/2% Senior Discount Notes Due 2008 (herein called
the "Securities"), limited (except as otherwise provided in the Indenture
referred to below) in aggregate principal amount at maturity to $833,815,000,
which may be issued under an indenture (herein called the "Indenture") dated as
of December 2, 1998 between the Company and IBJ Xxxxxxxx Bank & Trust Company,
as trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties, obligations and immunities thereunder of the
Company, the Trustee and the Holders of the Securities, and of the terms upon
which the Securities are, and are to be, authenticated and delivered.
The Securities are subject to redemption at the option of the Company, in
whole or in part, at any time or from time to time on or after December 1, 2003,
upon not less than 30 nor more than 60 days' prior notice, at the redemption
prices (expressed as percentages of Accreted Value) set forth below, plus
accrued and unpaid interest thereon (if any) to the redemption date (subject to
the right of Holders of record on the relevant record date to receive interest
due on the relevant interest payment date), if redeemed during the twelve months
beginning December 1 of the years indicated below:
Year Redemption Price
---- ----------------
2003.................................................105.250%
2004.................................................103.500%
2005.................................................101.750%
2006 and thereafter..................................100.000%
In addition, at any time or from time to time prior to December 1, 2001,
the Company may redeem up to 35% of the original aggregate principal amount at
maturity of the Securities at a redemption price equal to 110.500% of the
Accreted Value of the Securities so redeemed, plus accrued and unpaid interest
thereon (if any) to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date), with the net cash proceeds of one or more private
placements to Persons other than Affiliates of the Company or underwritten
public offerings of Common Stock of the Company resulting in gross proceeds of
at least $100,000,000 in the aggregate; provided that at least 65% of the
--------
original aggregate principal amount at maturity of the Securities would remain
outstanding immediately after giving effect to any such redemption. Any such
redemption shall be made within 90 days of any such private placement or public
offering upon not less than 30 nor more than 60 days' prior notice.
A-7
Upon the occurrence of a Change of Control Triggering Event, the Holder of
this Security may require the Company, subject to certain limitations provided
in the Indenture, to repurchase this Security at a purchase price in cash in an
amount equal to 101% of the Accreted Value thereof, plus accrued and unpaid
interest (if any) to the purchase date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date).
In the case of any redemption of Securities, interest installments whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Securities, or one or more Predecessor Securities, of record at
the close of business on the relevant Record Date referred to on the face
hereof. Securities (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear interest
or accrete principal, as the case may be, from and after the Redemption Date.
In the event of redemption of this Security in part only, a new Security or
Securities for the unredeemed portion hereof shall be issued in the name of the
Holder hereof upon the cancellation hereof.
To guarantee the due and punctual payment of the Accreted Value, premium
(if any) and interest on the Securities and all other amounts payable by the
Company under the Indenture and the Securities when and as the same shall be due
and payable, whether at maturity, by acceleration or otherwise, according to the
terms of the Securities and the Indenture, the Guarantors, if any, will
unconditionally guarantee such obligations on a senior unsecured basis pursuant
to the terms of the Indenture.
If an Event of Default shall occur and be continuing, the Accreted Value of
all the Securities may be declared due and payable in the manner and with the
effect provided in the Indenture.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security and (b) certain restrictive
covenants and Defaults and Events of Default, upon compliance by the Company
with certain conditions set forth therein, which provisions apply to this
Security.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of a majority in
aggregate principal amount at maturity of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount at maturity of the
Securities at the time Outstanding, on behalf of the Holders of all the
Securities, to
A-8
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Without the
consent of any Holder of Securities, the Company and the Trustee may amend or
modify the Indenture for certain purposes specified therein, including the
release of Guarantors, if any, from Restricted Subsidiary Guarantees as provided
by the terms of the Indenture. Any such consent or waiver by or on behalf of the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the Accreted Value of (and premium, if any)
and interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable on the Security Register of
the Company, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained for such purpose in The City of New
York, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount at maturity, will be issued to the designated transferee or
transferees. The Securities are issuable only in registered form without coupons
in denominations of $1,000 principal amount at maturity and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the Securities are exchangeable for a like
aggregate Accreted Value of Securities of a different authorized denomination,
as requested by the Holder surrendering the same.
No service charge shall be made for any registration of transfer or
exchange of the Securities, but the Company may require payment of a sum
sufficient to cover any transfer tax or other similar governmental charge
payable in connection therewith.
Prior to the time of due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any agent shall be affected by notice to the
contrary.
A-9
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW
OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
A-10
Form of Trustee's Certificate of Authentication
-----------------------------------------------
The Trustee's certificate of authentication shall be in substantially
the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
Dated:
------------------------------
This is one of the Securities referred to in the within-mentioned
Indenture.
[NAME OF TRUSTEE], as Trustee
By:
---------------------------------
Authorized Signatory
A-11
Assignment Form
---------------
If you, the holder, want to assign this Security, fill in the form below
and have your signature guaranteed:
I or we assign and transfer this Security to _________________________________
________________________________________________________________________________
(Insert assignee's social security or tax ID number)
___________________________________________
(Print or type assignee's name, address and zip code)
_______________________________________
_______________________________________
_______________________________________
and irrevocably appoint __________________________________
of ______________________________________
______________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for such agent.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the date that is two years (or such shorter
period as may be prescribed by Rule 144(k) under the Securities Act or any
successor provision thereunder) after the later of the date of original issuance
of such Securities (or any Predecessor Security) or three months after the last
date, if any, on which such Securities (or any Predecessor Security) were owned
by the Company or any Affiliate of the Company, the undersigned confirms that
such Securities are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [_] to the Company; or
(2) [_] pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) [_] inside the United States to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act of
1933) that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that such
transfer is being made in reliance on Rule 144A, in each case
pursuant to and in
A-12
compliance with Rule 144A under the Securities Act of 1933; or
(4) [_] outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933,
provided that, if such transfer is being effected by certain
transferors specified in the Indenture prior to the date that is
40 days following the Issue Date, a certificate which may be
obtained from the Company or the Trustee is delivered by the
transferee to the Company and the Trustee; or
(5) [_] to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933) that has furnished to the Trustee a signed letter
containing certain representations and agreements (the form of
which letter can be obtained from the Trustee or the Company),
provided that certain transferors specified in the Indenture may
not transfer this Security pursuant to this clause (5) prior to
the date that is 40 days following the Issue Date; or
(6) [_] pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if box (4), (5) or
-------- -------
(6) is checked, the Trustee may require, prior to registering any such transfer
of the Securities, such legal opinions, certifications and other information as
the Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
Dated: Your signature:
------------------- ---------------------------
(Sign exactly as your
name appears on the other side of this
Security)
By:
---------------------------------------
NOTICE: To be executed by an
executive officer
Signature Guarantee:
-----------------------------------------------------------
A-13
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED:
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933 and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A (including the information
specified in Rule 144A(d)(4)) or has determined not to request such information
and that it is aware that the transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:
--------------------------------- --------------------------------
NOTICE: To be executed by an
executive officer
Option of Holder to Elect Purchase
----------------------------------
If you wish to have this Security purchased by the Company pursuant to
Section 1009 or 1016 of the Indenture, check the box: [_]
If you wish to have a portion of this Security purchased by the Company
pursuant to Section 1009 or 1016 of the Indenture, state the amount: $ _______ .
Dated: Your Signature:
--------------------------------
(Sign exactly as your name appears on the other
side of this Security)
A-14
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount at maturity of this Global Security is $[ ].
The following increases or decreases in this Global Security have been made:
Date of Amount of decrease Amount of increase Principal amount at Signature of
Transfer in Principal Amount in Principal Amount Maturity of this authorized signatory
at Maturity of this at Maturity of this Global Security of Trustee or
Global Security Global Security following such Security Registrar
decrease or increase
A-15
EXHIBIT B
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") dated as of
_________________________, among [GUARANTOR] (the "New Guarantor"), a
subsidiary of Level 3 Communications, Inc. (or its successor), a Delaware
corporation (the "Company"), XXXXX 0 XXXXXXXXXXXXXX, XXX., on behalf of
itself and the Guarantors (the "Existing Guarantors"), if any, under the
Indenture referred to below, and IBJ XXXXXXXX BANK & TRUST COMPANY, a New
York banking corporation, as trustee under the indenture referred to below
(the "Trustee").
W I T N E S S E T H :
WHEREAS the Company has heretofore executed and delivered to the Trustee an
Indenture dated as of December 2, 1998 (the "Indenture"; capitalized terms used
but not defined herein having the meanings assigned thereto in the Indenture),
providing for the issuance of an aggregate principal amount at maturity of up to
$833,815,000 of 10-1/2% Senior Discount Notes Due 2008 (the "Securities");
WHEREAS the Indenture permits the New Guarantor to execute and deliver to
the Trustee a supplemental indenture pursuant to which the New Guarantor shall
unconditionally guarantee all the Company's obligations under the Securities
pursuant to a Guarantee on the terms and conditions set forth herein;
WHEREAS the Guarantee contained in this Supplemental Indenture shall
constitute a "Restricted Subsidiary Guarantee", and the New Guarantor shall
constitute a "Guarantor", for all purposes of the Indenture; and
WHEREAS pursuant to Section 901 of the Indenture, the Trustee and the
Company are authorized to execute and deliver this Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Company, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the holders of the
Securities as follows:
1. Guaranties. The New Guarantor hereby unconditionally guarantees, jointly
----------
and severally, to each Holder and to the Trustee and its successors and assigns
(a) the full
B-1
and punctual payment of Accreted Value of (and premium, if any) and interest on
the Securities when due, whether at Stated Maturity, by acceleration, by
redemption or otherwise, and all other monetary obligations of the Company under
the Indenture and the Securities and (b) the full and punctual performance
within applicable grace periods of all other obligations of the Company under
the Indenture and the Securities (all the foregoing being hereinafter
collectively called the "Obligations"). The New Guarantor further agrees that
the Obligations may be extended or renewed, in whole or in part, without notice
or further assent from the New Guarantor and that the New Guarantor will remain
bound under this Supplemental Indenture notwithstanding any extension or renewal
of any Obligation.
The New Guarantor waives presentation to, demand of, payment from and
protest to the Company of any of the Obligations and also waives notice of
protest for nonpayment. The New Guarantor waives notice of any default under the
Securities or the Obligations. The obligations of the New Guarantor hereunder
shall not be affected by (a) the failure of any Holder or the Trustee to assert
any claim or demand or to enforce any right or remedy against the Company or any
other Person under the Indenture, the Securities or any other agreement or
otherwise; (b) any extension or renewal of any thereof; (c) any rescission,
waiver, amendment or modification of any of the terms or provisions of the
Indenture, the Securities or any other agreement; (d) the release of any
security held by any Holder or the Trustee for the Obligations or any of them;
(e) the failure of any Holder or the Trustee to exercise any right or remedy
against any other guarantor of the Obligations; or (f) any change in the
ownership of the New Guarantor.
The New Guarantor further agrees that its Guarantee herein constitutes a
guarantee of payment, performance and compliance when due (and not a guarantee
of collection) and waives any right to require that any resort be had by any
Holder or the Trustee to any security held for payment of the Obligations.
Except as expressly set forth in Sections 803, 1017, 1019, 1202 and 1203 of
the Indenture, the obligations of the New Guarantor hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to any defense of setoff, counterclaim, recoupment or
termination whatsoever or by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of the New Guarantor herein shall
not be discharged or impaired or otherwise affected by the failure of any Holder
or the Trustee to assert any claim or demand or to enforce any remedy under the
Indenture, the Securities or any other agreement, by any waiver or modification
of any thereof, by any default, failure or delay, willful or otherwise, in the
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performance of the obligations, or by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of the New Guarantor or would otherwise operate as a
discharge of the New Guarantor as a matter of law or equity.
The New Guarantor further agrees that its Guarantee herein shall continue
to be effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of Accreted Value of (or premium, if any) or interest on any
Obligation is rescinded or must otherwise be restored by any Holder or the
Trustee upon the bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other right
which any Holder or the Trustee has at law or in equity against the New
Guarantor by virtue hereof, upon the failure of the Company to pay the Accreted
Value of (or premium, if any) or interest on any Obligation when and as the same
shall become due, whether at Stated Maturity, by acceleration, by redemption or
otherwise, or to perform or comply with any other Obligation, the New Guarantor
hereby promises to and will, upon receipt of written demand by the Trustee,
forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee an
amount equal to the sum of (i) the unpaid amount of such Obligations, (ii)
accrued and unpaid interest on such Obligations (but only to the extent not
prohibited by law) and (iii) all other monetary Obligations of the Company to
the Holders and the Trustee.
The New Guarantor agrees that it shall not be entitled to any right of
subrogation in respect of any Obligations guaranteed hereby until payment in
full in cash of all Obligations. The New Guarantor further agrees that, as
between it, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the Obligations guaranteed hereby may be accelerated as
provided in Article Five of the Indenture for the purposes of the New
Guarantor's Guarantee herein, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Obligations
guaranteed hereby, and (y) in the event of any declaration of acceleration of
such obligations as provided in Article Five of the Indenture, such Obligations
(whether or not due and payable) shall forthwith become due and payable by the
New Guarantor for the purposes of this Section.
The New Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees) incurred by the Trustee or any Holder in
enforcing any rights under this Section 1.
2. Contribution. Each of the Company and the New Guarantor (a "Contributing
------------
Party") agrees that, in the event a payment shall be made by any other Guarantor
under any Restricted Subsidiary Guarantee (the "Claiming Guarantor"), the
Contributing
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Party shall indemnify the Claiming Guarantor in an amount equal to the amount of
such payment multiplied by a fraction, the numerator of which shall be the net
worth of the Contributing Party (which, in the case of the Company, shall be
measured on the Issue Date, and in the case of the New Guarantor, on the date
hereof) and the denominator of which shall be the aggregate net worth of the
Company on the Issue Date and the Guarantors on respective dates of the
Supplemental Indentures executed and delivered by such Guarantors.
3. Successors and Assigns. This Supplemental Indenture shall be binding
----------------------
upon the New Guarantor and its successors and assigns and shall enure to the
benefit of the successors and assigns of the Trustee and the Holders and, in the
event of any transfer or assignment of rights by any Holder or the Trustee, the
rights and privileges conferred upon that party in the Indenture and in the
Securities shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
4. No Waiver. Neither a failure nor a delay on the part of either the
---------
Trustee or the Holders in exercising any right, power or privilege under this
Supplemental Indenture, the Indenture or the Securities shall operate as a
waiver thereof, nor shall a single or partial exercise thereof preclude any
other or further exercise of any right, power or privilege. The rights, remedies
and benefits of the Trustee and the Holders herein and therein expressly
specified are cumulative and not exclusive of any other rights, remedies or
benefits which either may have under this Supplemental Indenture, the Indenture
or the Securities at law, in equity, by statute or otherwise.
5. Modification. No modification, amendment or waiver of any provision of
------------
this Supplemental Indenture, nor the consent to any departure by the New
Guarantor therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on the New Guarantor in any case shall entitle the New
Guarantor to any other or further notice or demand in the same, similar or other
circumstances.
6. Opinion of Counsel. Concurrently with the execution and delivery of this
------------------
Supplemental Indenture, the Company shall deliver to the Trustee an Opinion of
Counsel to the effect that this Supplemental Indenture has been duly authorized,
executed and delivered by each of the New Guarantor and the Company and that,
subject to the application of bankruptcy, insolvency, moratorium, fraudulent
conveyance or transfer and other similar laws relating to creditors' rights
generally and to the principles of equity, whether considered in a proceeding at
law or in equity, the Guarantee of the New Guarantor is a legal, valid and
binding obligation of the New Guarantor, enforceable against the New Guarantor
in accordance with its terms.
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7. Ratification of Indenture; Supplemental Indentures Part of Indenture.
--------------------------------------------------------------------
Except as expressly amended hereby, the Indenture is in all respects ratified
and confirmed and all the terms, conditions and provisions thereof shall remain
in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Securities heretofore or
hereafter authenticated and delivered shall be bound hereby.
8. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
-------------
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
9. Counterparts. The parties may sign any number of copies of this
------------
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
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10. Effect of Headings. The Section headings herein are for convenience
------------------
only and shall not effect the construction thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
[NEW GUARANTOR],
by
-------------------------------
Name:
Title:
LEVEL 3 COMMUNICATIONS, INC.,
on behalf of itself and the Existing
` Guarantors, if any,
by
-------------------------------
Name:
Title:
IBJ XXXXXXXX BANK & TRUST COMPANY, as
Trustee,
by
-------------------------------
Name:
Title:
