EXHIBIT 4.1(c)
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QWEST COMMUNICATIONS INTERNATIONAL INC.,
Issuer
to
BANKERS TRUST COMPANY,
Trustee
____________________
INDENTURE
Dated as of January 29, 1998
_____________________
$450,505,000 Principal Amount at Maturity
8.29% Senior Discount Notes Due 2008
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TABLE OF CONTENTS
PAGE
PARTIES..................................................... 1
RECITALS OF THE COMPANY..................................... 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.............................. 1
Accreted Value.................................... 2
Acquired Debt..................................... 2
Act............................................... 2
Affiliate......................................... 3
Agent Member...................................... 3
Asset Disposition................................. 3
Attributable Value................................ 3
Board of Directors................................ 4
Board Resolution.................................. 4
Business Day...................................... 4
Capital Lease Obligation.......................... 4
Capital Stock..................................... 4
Cash Equivalents.................................. 4
Change of Control................................. 5
Commission........................................ 5
Common Stock...................................... 5
Company........................................... 5
Company Order..................................... 5
Company Request................................... 5
Consolidated Capital Ratio........................ 5
Consolidated Cash Flow Available for Fixed
Charges.......................................... 5
Consolidated Income Tax Expense................... 6
Consolidated Interest Expense..................... 6
Consolidated Net Income........................... 6
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Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
ii
PAGE
Consolidated Net Worth........................... 7
Consolidated Tangible Assets..................... 7
Continuing Director.............................. 7
Corporate Trust Office........................... 7
Corporation...................................... 8
Credit Facilities................................ 8
Debt............................................. 8
Debt Securities.................................. 8
Default.......................................... 9
Defaulted Interest............................... 9
Depository....................................... 9
Designation...................................... 9
Designation Amount............................... 9
Disqualified Stock............................... 9
Eligible Institution............................. 9
Eligible Receivables............................. 9
Event of Default................................. 9
Exchange Act..................................... 10
Exchange Offer................................... 10
Exchange Offer Registration Statement............ 10
Exchange Securities.............................. 10
Expiration Date.................................. 10
Fair Market Value................................ 10
Federal Bankruptcy Code.......................... 10
Global Security.................................. 10
Government Securities............................ 10
Group............................................ 10
Guarantee........................................ 10
Guarantor........................................ 11
Holder........................................... 11
Incur............................................ 11
Indenture........................................ 11
Indenture Obligations............................ 11
Initial Purchaser................................ 11
Initial Securities............................... 12
Interest Payment Date............................ 12
Interest Rate or Currency Protection Agreement... 12
Investment....................................... 12
Lien............................................. 12
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PAGE
Liquidated Interest.............................. 12
Maturity......................................... 12
Net Available Proceeds........................... 12
Notice of Default................................ 13
Offer............................................ 13
Offer to Purchase................................ 13
Offering Memorandum.............................. 15
Officers' Certificate............................ 15
Opinion of Counsel............................... 15
Outstanding...................................... 16
Paying Agent..................................... 16
Permitted Holders................................ 17
Permitted Interest Rate or Currency Protection
Agreement....................................... 17
Permitted Investments............................ 17
Permitted Joint Venture.......................... 17
Permitted Liens.................................. 17
Permitted Telecommunications Capital Asset
Disposition..................................... 18
Person........................................... 18
Physical Security................................ 18
Predecessor Security............................. 18
Preferred Dividends.............................. 19
Preferred Stock.................................. 19
Private Placement Legend......................... 19
Public Equity Offering........................... 19
Purchase Amount.................................. 19
Purchase Date.................................... 19
Purchase Money Debt.............................. 19
Purchase Price................................... 19
Qualified Institutional Buyer.................... 19
QIB.............................................. 19
Rating Decline................................... 19
Receivables...................................... 20
Receivables Sale................................. 20
Redemption Date.................................. 20
Redemption Price................................. 20
Registration Agreement........................... 20
Registration Statement........................... 20
Regular Record Date.............................. 20
Regulation S..................................... 20
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PAGE
Regulation S Global Security............................ 20
Related Person.......................................... 20
Responsible Officer..................................... 20
Restricted Payment...................................... 21
Restricted Subsidiary................................... 21
Restricted Subsidiary Guarantee......................... 21
Revocation.............................................. 21
Rule 144A............................................... 21
Rule 144A Global Security............................... 21
Sale and Leaseback Transaction.......................... 21
Securities.............................................. 21
Securities Act.......................................... 22
Security Register....................................... 22
Security Registrar...................................... 22
Senior Notes............................................ 22
Senior Note Indentures.................................. 22
Shelf Registration Statement............................ 22
Special Record Date..................................... 22
Stated Maturity......................................... 22
Strategic Investor...................................... 22
Subordinated Debt....................................... 22
Subsidiary.............................................. 23
Telecommunications Assets............................... 23
Telecommunications Business............................. 23
Trust Indenture Act..................................... 23
TIA..................................................... 23
Trustee................................................. 24
Unrestricted Subsidiary................................. 24
Vice President.......................................... 24
Voting Stock............................................ 24
Wholly Owned Subsidiary................................. 24
SECTION 102. Compliance Certificates and Opinions............ 24
SECTION 103. Form of Documents Delivered to Trustee.......... 25
SECTION 104. Acts of Holders................................. 25
SECTION 105. Notices, Etc., to Trustee and Company........... 27
SECTION 106. Notice to Holders; Waiver....................... 27
SECTION 107. Effect of Headings and Table of Contents........ 28
SECTION 108. Successors and Assigns.......................... 28
SECTION 109. Separability Clause............................. 28
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PAGE
SECTION 110. Benefits of Indenture.................................. 28
SECTION 111. Governing Law.......................................... 28
SECTION 112. Conflict with Trust Indenture Act...................... 28
SECTION 113. Legal Holidays......................................... 29
SECTION 114. No Personal Liability of Directors,
Officers, Employees and Stockholders.............. 29
SECTION 115. Independence of Covenants.............................. 29
SECTION 116. Exhibits............................................... 29
SECTION 117. Counterparts........................................... 30
SECTION 118. Duplicate Originals.................................... 30
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally........................................ 30
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms........................................ 31
SECTION 302. Denominations.......................................... 32
SECTION 303. Execution, Authentication, Delivery and Dating......... 32
SECTION 304. Temporary Securities................................... 34
SECTION 305. Registration, Registration of Transfer and Exchange.... 34
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities....... 36
SECTION 307. Payment of Interest; Interest Rights Preserved......... 36
SECTION 308. Persons Deemed Owners.................................. 38
SECTION 309. Cancellation........................................... 38
SECTION 310. Computation of Interest................................ 38
SECTION 311. CUSIP Number........................................... 39
SECTION 312. Book-Entry Provisions for Global Securities............ 39
SECTION 313. Special Transfer Provisions............................ 40
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.................. 42
SECTION 402. Application of Trust Money............................... 43
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default........................................ 43
SECTION 502. Acceleration of Maturity; Rescission and
Annulment................................................ 45
SECTION 503. Collection of Indebtedness and Suits for Enforcement
by Trustee............................................. 46
SECTION 504. Trustee May File Proofs of Claim......................... 47
SECTION 505. Trustee May Enforce Claims Without
Possession of Securities............................... 48
SECTION 506. Application of Money Collected........................... 48
SECTION 507. Limitation on Suits...................................... 49
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest................................... 49
SECTION 509. Restoration of Rights and Remedies....................... 50
SECTION 510. Rights and Remedies Cumulative........................... 50
SECTION 511. Delay or Omission Not Waiver............................. 50
SECTION 512. Control by Holders....................................... 50
SECTION 513. Waiver of Past Defaults.................................. 51
SECTION 514. Waiver of Stay or Extension Laws......................... 51
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities...................... 52
SECTION 602. Notice of Default........................................ 53
SECTION 603. Certain Rights of Trustee................................ 53
SECTION 604. Trustee Not Responsible for Recitals or Issuance of
Securities............................................. 55
SECTION 605. May Hold Securities...................................... 55
SECTION 606. Money Held in Trust...................................... 55
SECTION 607. Compensation and Reimbursement........................... 55
SECTION 608. Corporate Trustee Required; Eligibility; Conflicting
Interests.............................................. 56
SECTION 609. Resignation and Removal; Appointment of Successor........ 57
SECTION 610. Acceptance of Appointment by Successor................... 58
SECTION 611. Merger, Conversion, Consolidation or Succession to
Business............................................... 58
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ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
PAGE
SECTION 701. Disclosure of Names and Addresses of Holders............ 59
SECTION 702. Reports by Trustee...................................... 59
SECTION 703. Reports by Company...................................... 60
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.... 60
SECTION 802. Successor Substituted................................... 61
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders...... 62
SECTION 902. Supplemental Indentures with Consent of Holders......... 62
SECTION 903. Execution of Supplemental Indentures.................... 63
SECTION 904. Effect of Supplemental Indentures....................... 64
SECTION 905. Conformity with Trust Indenture Act..................... 64
SECTION 906. Reference in Securities to Supplemental Indentures...... 64
SECTION 907. Notice of Supplemental Indentures....................... 64
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if Any, and Interest.... 64
SECTION 1002. Maintenance of Office or Agency........................ 65
SECTION 1003. Money for Security Payments to Be Held in Trust........ 65
SECTION 1004. Corporate Existence.................................... 67
SECTION 1005. Payment of Taxes and Other Claims...................... 67
SECTION 1006. Maintenance of Properties.............................. 67
SECTION 1007. Insurance.............................................. 68
SECTION 1008. Provision of Financial Statements...................... 68
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PAGE
SECTION 1009. Statement by Officers as to Default.................... 68
SECTION 1010. Purchase of Securities upon Change of Control.......... 68
SECTION 1011. Limitation on Consolidated Debt........................ 70
SECTION 1012. Limitation on Debt and Preferred Stock of Restricted
Subsidiaries......................................... 72
SECTION 1013. Limitation on Restricted Payments...................... 74
SECTION 1014. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries.................... 76
SECTION 1015. Limitation on Liens.................................... 77
SECTION 1016. Limitation on Issuances of Certain Guarantees by, and
Debt Securities of, Restricted Subsidiaries.......... 78
SECTION 1017. Limitation on Sale and Leaseback Transactions.......... 78
SECTION 1018. Limitation on Asset Dispositions....................... 78
SECTION 1019. Limitation on Issuances and Sales of Capital Stock of
Restricted Subsidiaries.............................. 79
SECTION 1020. Transactions with Affiliates and Related Persons....... 80
SECTION 1021. Limitation on Designations of Unrestricted
Subsidiaries......................................... 80
SECTION 1022. No Repayment of Existing Parent Company Advances with
the Proceeds of the Securities....................... 81
SECTION 1023. Waiver of Certain Covenants............................ 82
SECTION 1024. Trustee Not to Monitor Performance..................... 82
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption.................................... 82
SECTION 1102. Applicability of Article............................... 82
SECTION 1103. Election to Redeem; Notice to Trustee.................. 82
SECTION 1104. Selection by Trustee of Securities to Be Redeemed...... 83
SECTION 1105. Notice of Redemption................................... 83
SECTION 1106. Deposit of Redemption Price............................ 84
SECTION 1107. Securities Payable on Redemption Date.................. 84
SECTION 1108. Securities Redeemed in Part............................ 85
ix
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
PAGE
SECTION 1201. Company's Option to Effect Defeasance or Covenant
Defeasance........................................... 85
SECTION 1202. Defeasance and Discharge............................... 85
SECTION 1203. Covenant Defeasance.................................... 86
SECTION 1204. Conditions to Defeasance or Covenant Defeasance........ 86
SECTION 1205. Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions................ 88
SECTION 1206. Reinstatement.......................................... 88
TESTIMONIUM........................................................... 87
SIGNATURES AND SEALS.................................................. 87
EXHIBIT A - Form of Security
EXHIBIT B - Form of Certificate to Be Delivered in Connection with Transfers
Pursuant to Regulation S
INDENTURE, dated as of January 29, 1998 between Qwest Communications
International Inc., a corporation duly organized and existing under the laws of
the State of Delaware (herein called the "Company"), having its principal office
at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000, and Bankers 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 8.29% Senior
Discount Notes Due 2008 (herein called the "Initial Securities") and 8.29%
Series B 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:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
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For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
(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, and the terms "cash transaction" and "self-
liquidating paper", as used in TIA Section 311,
2
shall have the meanings assigned to them in the rules of the Commission
adopted under the Trust Indenture Act;
(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 such accounting principles as
are generally accepted at the date of such computation;
(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; and
(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.
"Accreted Value" means, with respect to any Note, (i) as of any date
prior to February 1, 2003, an amount per $1,000 principal amount at maturity of
Notes that is equal to the sum of (a) the offering price ($665.92 per $1,000
principal amount at maturity of Notes) of such Notes and (b) the portion of the
excess of the principal amount at maturity of such Notes over such offering
price which shall have been amortized through such date, such amount to be so
amortized on a daily basis and compounded semiannually on each February 1 and
August 1 at a rate of 8.29% per annum from the date of original issue of the
Notes through the date of determination computed on the basis of a 360-day year
of twelve 30-day months, and (ii) as of any date on or after February 1, 2003,
the principal amount at maturity of each Note; provided, however, that if the
Company elects to commence the accrual of cash interest on the Notes on or after
February 1, 2001 and prior to February 1, 2003, the Notes shall cease to
accrete, and the Accreted Value and the principal amount at maturity thereof
shall be the Accreted Value on the date of commencement of such accrual as
calculated in accordance with the foregoing.
"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 asset 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.
3
"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.
"Agent Member" has the meaning specified in Section 312.
"Asset Disposition" means any transfer, conveyance, sale, lease or
other disposition by the Company or any Restricted Subsidiary in one or more
related transactions occurring within any 12-month period (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
clauses (iii), (iv) and (v) of Section 1019), (ii) substantially all of the
assets of the Company or any Restricted Subsidiary representing a division or
line of business or (iii) other assets or rights 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 stating that such
criteria are satisfied); provided in each case that the aggregate consideration
for such transfer, conveyance, sale, lease or other disposition is equal to
$500,000 or more in any 12-month period and provided further that the following
shall not be Asset Dispositions: (x) Permitted Telecommunications Capital Asset
Dispositions, (y) exchanges of Telecommunications Assets for other
Telecommunications Assets where the Fair Market Value of the Telecommunications
Assets received is at least equal to the Fair Market Value of the
Telecommunications Assets disposed of or, if less, the difference is received in
cash and such cash is Net Available Proceeds and (z) Liens permitted to be
Incurred pursuant to the second paragraph of Section 1015.
"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 initial term
thereof as determined in accordance with generally accepted accounting
principles, discounted from the last date of such initial 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
4
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
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 amounts under a lease of (or other Debt arrangements
conveying the right to use) real or personal 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.
"Cash Equivalents" means (i) any Debt with a maturity of 365 days or
less issued or directly and fully guaranteed as insured by the United States or
any agency or instrumentality thereof (provided that the full faith and credit
of the United States is pledged in support thereof or such Debt constitutes a
general obligation of such country); (ii) deposits, certificates of deposit or
acceptances with a maturity of 365 days or less of any financial institution
that is a member of the Federal Reserve System, in each case having combined
capital and surplus and undivided profits (or any similar capital concept) of
not less than $500
5
million and whose senior unsecured debt is rated at least "A-1" by Standard &
Poor's Ratings Services or "P-1" by Xxxxx'x Investors Service, Inc.; (iii)
commercial paper with a maturity of 365 days or less issued by a Corporation
(other than an Affiliate of the Company) organized under the laws of the United
States or any state thereof and rated at least "A-1" by Standard & Poor's
Ratings Services or "P-1" by Xxxxx'x Investors Service, Inc.; and (iv)
repurchase agreements and reverse repurchase agreements relating to marketable
direct obligations issued or unconditionally guaranteed by the United States or
issued by any agency or instrumentality thereof and backed by the full faith and
credit of the United States maturing within 365 days from the date of
acquisition.
"Change of Control" has the meaning specified in Section 1010.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"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 Chief Executive Officer, the President
or a Vice President, and by the Chief Financial Officer, the Chief Accounting
Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee.
"Consolidated Capital Ratio" of any Person as of any date means the
ratio of (i) the aggregate consolidated principal amount of Debt of such Person
then outstanding to (ii) the greater of either (a) the aggregate consolidated
paid-in capital of such Person as of such date or (b) the stockholders' equity
as of such date as shown on the consolidated balance sheet of such Person in
accordance with generally accepted accounting principles.
"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 (i) Consolidated Interest Expense of the
Company and its Restricted
6
Subsidiaries for such period, plus (ii) Consolidated Income Tax Expense of the
Company and its Subsidiaries for such period, plus (iii) the consolidated
depreciation and amortization expense or other non-cash write-offs of assets
included in the income statement of the Company and its Restricted Subsidiaries
for such period, plus (iv) any charge related to any premium or penalty paid in
connection with redeeming or retiring any Debt prior to its stated maturity;
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 restriction.
"Consolidated Income Tax Expense" for any period means the aggregate
amounts of the provisions for income taxes of the Company and its Subsidiaries
for such period calculated on a consolidated basis in accordance with generally
accepted accounting principles.
"Consolidated Interest Expense" means for any period 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; (ii) any payments or fees with respect to
letters of credit, bankers' acceptances or similar facilities; (iii) fees with
respect to interest rate swap or similar agreements or foreign currency hedge,
exchange or similar agreements; (iv) Preferred Stock dividends of the Company
and its Subsidiaries (other than dividends paid in shares of Preferred Stock
that is not Disqualified Stock) declared and paid or payable; (v) accrued
Disqualified Stock dividends of the Company and its Restricted Subsidiaries,
whether or not declared or paid; (vi) interest on Debt guaranteed by the Company
and its Restricted Subsidiaries; and (vii) the portion of any Capital Lease
Obligation paid during such period that is allocable to interest expense.
"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) 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, (c) gains or losses on Asset Dispositions by the
Company or its Restricted Subsidiaries, (d) all extraordinary gains and
extraordinary losses, determined in accordance with generally accepted
accounting principles,
7
(e) the cumulative effect of changes in accounting principles, (f) non-cash
gains or losses resulting from fluctuations in currency exchange rates, (g) any
non-cash expense related to the issuance to employees or directors of the
Company or any Restricted Subsidiary or any Affiliate of the Company of (i)
options to purchase Capital Stock of the Company or such Restricted Subsidiary
or (ii) other compensatory rights (including under the Company's Growth Share
Plan), provided, in either case, that such options or rights, by their terms,
can be redeemed only for Capital Stock, (h) 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 shall be excluded and (i) the tax effect of any of the items
described in clauses (a) through (h) above; provided further that for purposes
of any determination pursuant to Section 1013, 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; provided that, with respect to the Company, adjustments
following March 31, 1997 to the accounting books and records of the Company in
accordance with Accounting Principles Board Opinions Nos. 16 and 17 (or
successor opinions thereto) or otherwise resulting from the acquisition of
control of the Company by another Person shall not be given effect to.
"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 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.
"Continuing Director" means, as of any date of determination, any
member of the Board of Directors who (i) was a member of such Board of Directors
on March 31, 1997 or (ii) was nominated for election or elected to the Board of
Directors with the affirmative vote of a majority of the Continuing Directors
who were members of the Board of Directors at the time of such nomination or
election or the affirmative vote of Permitted Holders.
"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 Four Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, except that, with
respect to presentation of Securities for payment or
8
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.
"Corporation" includes corporations, associations, companies and
business trusts.
"Credit Facilities" means one or more credit agreements, loan
agreements or similar facilities, secured or unsecured, 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, assets or businesses, (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, (vi) all
Receivables Sales of such Person, together with any obligation of such Person to
pay any discount, interest, fees, indemnities, penalties, recourse, expenses or
other amounts in connection therewith, (vii) all obligations to redeem
Disqualified Stock issued by such Person, (viii) every obligation under Interest
Rate and 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 the amount of the
liability in respect thereof determined in accordance with generally accepted
accounting principles, (b) any Receivables Sale shall be the amount of the
unrecovered capital or principal investment of the purchaser (other than the
Company or a Wholly Owned Subsidiary of the Company) thereof, excluding amounts
representative of yield or interest earned on such investment, or (c) any
Disqualified Stock shall be the maximum fixed redemption or repurchase price in
respect thereof.
"Debt Securities" means any debt securities (including any guarantee
of such securities) issued by the Company or any Restricted Subsidiary of the
Company in connection with a public offering or a private placement (excluding
Debt permitted to be Incurred pursuant to paragraph (b) of Section 1011).
9
"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 1021.
"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 such Person, any
Subsidiary of such Person or 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 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 1010
and such Preferred Stock specifically provides that the Company shall 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 1010.
"Eligible Institution" means a commercial banking institution that has
combined capital and surplus of not less than $500 million or its equivalent in
foreign currency, whose debt is rated "A" (or higher) according to Standard &
Poor's Ratings Services or Xxxxx'x Investors Service, Inc. at the time as of
which any investment or rollover therein is made.
"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, less Receivables of the Company or any Restricted Subsidiary employed
to secure Debt Incurred pursuant to clause (vii) of paragraph (b) of Section
1011.
"Event of Default" has the meaning specified in Section 501.
10
"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 Offer" means the exchange offer that may be effected
pursuant to the Registration Agreement.
"Exchange Offer Registration Statement" means the Exchange Offer
Registration Statement as defined in the Registration Agreement.
"Exchange Securities" has the meaning stated in the first recital of
this Indenture and refers to any Exchange Securities containing terms
substantially identical to the Initial Securities (except that such Exchange
Securities shall not contain terms with respect to transfer restrictions) that
are issued and exchanged for the Initial Securities pursuant to the Registration
Agreement and this Indenture.
"Expiration Date" has the meaning specified in "Offer to Purchase"
below.
"Fair Market Value" means, with respect to any asset or 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. 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 or a Regulation S
Global Security, as the case may be.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States is pledged and
which have a remaining weighted average life to maturity of not less than one
year from the date of investment therein.
"Group" has the meaning specified in Section 1010.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing, or having the economic effect of
guaranteeing, any Debt of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and including, without limitation, any
obligation 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
11
supply funds for the purchase of) any security for the payment of such Debt,
(ii) to purchase property, securities or services for the purpose of assuring
the holder of such Debt of the payment of such Debt or (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 (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.
"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 by acquisition of Subsidiaries or 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.
"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.
"Indenture Obligations" means the obligations of the Company and any
other obligor under this Indenture or under the Securities to pay principal of,
premium, if any, and interest on the Securities when due and payable, whether at
maturity, by acceleration, call for redemption or repurchase or otherwise, and
all other amounts due or to become due under or in connection with this
Indenture or the Securities and the performance of all other obligations to the
Trustee (including, but not limited to, payment of all amounts due the Trustee
under Section 607), Paying Agent, Security Registrar and the Holders of the
Securities under this Indenture and the Securities according to the terms
thereof.
"Initial Purchaser" means Salomon Brothers Inc.
12
"Initial Securities" has the meaning provided in the recitals to this
Indenture.
"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, without limitation, caps, floors, collars
and similar agreements) relating to, or the value of which is dependent upon,
interest rates or currency exchange rates or indices.
"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, or purchase or acquisition of
Capital Stock, bonds, notes, debentures or other securities or evidence of Debt
issued by, any other Person, including any payment on a Guarantee of any
obligation of such other Person.
"Lien" means, with respect to any property or assets, any mortgage or
deed of trust, pledge, hypothecation, assignment, Receivables Sale, 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 or assets (including, without limitation,
any conditional sale or other title retention agreement having substantially the
same economic effect as any of the foregoing). For purposes of this definition
the sale, lease, conveyance or other transfer by the Company or any Subsidiary
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.
"Liquidated Interest" has the meaning specified in Exhibit A.
"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.
"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 properties or assets)
therefrom by such Person, net of (i) any portion thereof invested within 360
days of such Asset Disposition in Telecommunications Assets, (ii) all legal,
title and
13
recording tax expenses, commissions and other fees and expenses Incurred and all
federal, state, provincial, foreign and local taxes required to be accrued as a
liability as a consequence of such Asset Disposition, (iii) all payments made by
such Person or its Subsidiaries on any Debt which is secured by such assets in
accordance with the terms of any Lien upon or with respect to such assets 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, (iv) all distributions and other payments made to
minority interest holders in Subsidiaries of such Person or Permitted Joint
Ventures as a result of such Asset Disposition and (v) 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 assets and retained by such Person or any
Subsidiary thereof, as the case may be, after such Asset Disposition, including,
without limitation, 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 Board Resolution
filed with the Trustee; provided, however, that any reduction in such reserve
within twelve months following the consummation of such Asset Disposition shall
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.
"Notice of Default" has the meaning specified in Section 501.
"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
his address appearing in the Security Register on the date of the Offer offering
to purchase up to the principal amount of Securities specified in such Offer at
the purchase price specified in such Offer (as determined pursuant to Section
1010). 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"
14
contained in the documents required to be filed with the Trustee pursuant to
Section 1008 (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 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%, 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 each $1,000
aggregate principal amount at maturity of Securities accepted for payment
(as specified pursuant to Section 1010) (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 accrete or accrue interest, 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 on and
after the Purchase Date;
15
(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 its attorney duly authorized in writing);
(j) that Holders will be entitled to withdraw all or any portion of
Securities tendered if the Company (or their Paying 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 its 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 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.
"Offering Memorandum" means the Offering Memorandum dated January 22,
1998 pursuant to which the Securities were offered, and any supplement thereto.
"Officers' Certificate" means a certificate signed by the Chairman of
the board of directors of the Company, a Vice Chairman of the board of directors
of the Company, the President or a Vice President, and by the Chief Financial
Officer, the Chief Accounting Officer, the Treasurer, an Assistant Treasurer,
the Secretary or an Assistant Secretary of the Company and delivered to the
Trustee, which shall comply with the Indenture.
16
"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).
"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;
(ii) Securities, or portions thereof, for whose payment or
redemption money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Company) in trust or
set aside and segregated in trust by the Company (if the Company shall act
as its own Paying Agent) for the Holders of such Securities; provided that,
if such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture;
(iii) Securities, except to the extent provided in Sections 1202 and
1203, with respect to which the Company has effected defeasance and/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
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 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.
17
"Paying Agent" means any Person (including the Company acting as
Paying Agent) authorized by the Company to pay the principal or Accreted Value
of (and premium, if any) or interest on any Securities on behalf of the Company.
"Permitted Holders" means any Person who was the beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) of stock of the
Company on March 31, 1997, and any Affiliates of such Person (i) who were
Affiliates of such Person on March 31, 1997 or (ii) who were formed, directly or
indirectly, by any such Person after March 31, 1997; provided, however, that
Persons who were beneficial owners (within the meaning of Rule 13d-3 under the
Exchange Act) of such Person on March 31, 1997 continued to be beneficial owners
(within the meaning of Rule 13d-3 under the Exchange Act) at the time of
formation of such Affiliate.
"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 which shall have a
notional amount no greater than the payments due with respect to the Debt being
hedged thereby and not for purposes of speculation.
"Permitted Investments" means (a) Cash Equivalents; (b) Investments in
prepaid expenses, negotiable instruments held for collection and lease, utility
and workers' compensation, performance and other similar deposits; (c) loans,
advances or extensions of credit to employees and directors made in the ordinary
course of business and consistent with past practice; (d) obligations under
Interest Rate or Currency Protection Agreements; (e) bonds, notes, debentures
and other securities received as a result of Asset Dispositions pursuant to and
in compliance with Section 1018; (f) Investments made in the ordinary course of
business as partial payment for constructing a network relating to a
Telecommunications Business; (g) commercially reasonable extensions of trade
credit; (h) Investments in any Person as a result of which such Person becomes a
Restricted Subsidiary; (i) Investments in Permitted Joint Ventures in an
aggregate amount not to exceed $25 million; (j) Investments in Affiliates or
Related Persons in an aggregate amount not to exceed $11 million, provided that
the making of such Investments is permitted pursuant to Section 1020; and (k)
Investments in an aggregate amount not to exceed $15 million consisting of the
contribution by the Company or any Restricted Subsidiary of assets located in
Mexico to joint ventures in which the Company or a Restricted Subsidiary has an
interest.
"Permitted Joint Venture" means a Corporation, partnership or other
entity other than a Restricted Subsidiary engaged in one or more
Telecommunications Businesses over which the Company and/or one or more
Strategic Investors have, directly or indirectly, the power to direct the
policies, management and affairs.
18
"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'
business or the ownership of its property and assets 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 or assets when taken as a whole, or
materially impair the use thereof in the operation of its business; (c) Liens
with respect to assets of a Restricted Subsidiary granted by such Restricted
Subsidiary to the Company or a Restricted Subsidiary to secure Debt owing to the
Company or such Restricted Subsidiary; (d) Liens, pledges and deposits made in
the ordinary course of business in connection with workers' compensation,
unemployment insurance and other types of statutory obligations; (e) Liens,
pledges or deposits made to secure the performance of tenders, bids, leases,
public or statutory obligations, sureties, stays, appeals, indemnities,
performance 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); (f) 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; (g) Liens
arising out of judgments or awards against or other court proceedings concerning
the Company or any Restricted Subsidiary with respect to which the Company or
such Restricted Subsidiary is prosecuting an appeal or proceeding for review and
the Company or such Restricted Subsidiary is maintaining adequate reserves in
accordance with generally accepted accounting principles; and (h) 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 a capital asset that
is a Telecommunications Asset (including fiber, conduit and related equipment)
(i) the proceeds of which are treated as revenues by the Company in accordance
with generally accepted accounting principles and (ii) that, in the case of the
sale of fiber, would not result in the Company retaining less than 24 fibers per
route mile on any segment of the Company's network.
"Person" means any individual, Corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated organization,
government or agency or political subdivision thereof or any other entity.
"Physical Security" means Securities issued in registered definitive
form without coupons substantially in the form of Exhibit A.
19
"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 Dividends" for any Person means for any period the quotient
determined by dividing the amount of dividends and distributions paid or accrued
(whether or not declared) on Preferred Stock of such Person during such period
calculated in accordance with generally accepted accounting principles, by 1
minus the maximum statutory income tax rate then applicable to the Company
(expressed as a decimal).
"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 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.
"Private Placement Legend" means the third paragraph of the legend set
forth in the Securities in the form set forth in Exhibit A.
"Public Equity Offering" means an underwritten public offering of
common stock made on a primary basis by the Company pursuant to a registration
statement filed with, and declared effective by, the Commission in accordance
with the Securities Act.
"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 Incurred at any time within 270 days
of, and for the purposes of financing all or any part of the cost of, the
construction, installation, acquisition or improvement by the Company or any
Restricted Subsidiary of the Company of any new Telecommunications Assets
constructed, installed, acquired or improved after March 31, 1997, provided that
the proceeds of such Debt are expended for such purposes within such 270-day
period.
"Purchase Price" has the meaning specified in "Offer to Purchase"
above.
"Qualified Institutional Buyer" or "QIB" has the meaning specified in
Rule 144A.
20
"Rating Decline" means the Securities cease to be rated B+ (or the
equivalent thereof) or better by Standard & Poor's Ratings Services or B2 (or
the equivalent thereof) or better by Xxxxx'x Investors Service, Inc.
"Receivables" means receivables, chattel paper, instruments, documents
or intangibles evidencing or relating to the right to payment of money,
excluding allowances for doubtful accounts.
"Receivables Sale" of any Person means any sale of Receivables of such
Person (pursuant to a purchase facility or otherwise), other than in connection
with a disposition of the business operations of such Person relating thereto or
a disposition of defaulted Receivables for purposes of collection and not as a
financing arrangement.
"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.
"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.
"Registration Agreement" means the Registration Agreement between the
Company and the Initial Purchaser named therein, dated as of January 29, 1998,
relating to the Securities.
"Registration Statement" means the Registration Statement as defined
in the Registration Agreement.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the January 15 or July 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.
"Related Person" of any Person means any other Person directly or
indirectly owning (a) 5% or more of the outstanding Common Stock of such Person
(or, in the case of a Person that is not a Corporation, 5% or more of the
outstanding equity interest in such Person) or (b) 5% or more of the combined
outstanding voting power of the Voting Stock of such Person.
21
"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 1013.
"Restricted Subsidiary" means a Subsidiary of the Company, or of a
Restricted Subsidiary that is a Wholly Owned Subsidiary of the Company, that has
not been designated by the Board of Directors (by a Board Resolution delivered
to the Trustee) as an Unrestricted Subsidiary pursuant to and in compliance with
Section 1021.
"Restricted Subsidiary Guarantee" means a supplemental indenture to
this Indenture, in form satisfactory to the Trustee, executed in accordance with
Article Nine, providing for an unconditional Guarantee of payment in full of the
principal of, premium, if any, and interest on the Securities. Any such
Restricted Subsidiary Guarantee shall not be subordinate in right of payment to
any Debt of the Restricted Subsidiary providing the Restricted Subsidiary
Guarantee.
"Revocation" has the meaning specified in Section 1021.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Global Security" has the meaning specified in Section 303.
"Sale and Leaseback Transaction" of any Person means an arrangement
with any lender or investor or to which such lender or investor is a party
providing for the leasing by such Person of any property or asset of such Person
which has been or is being sold or transferred by such Person more than 365 days
after the acquisition thereof or the completion of construction or commencement
of operation thereof to such lender or investor or to any Person to whom funds
have been or are to be advanced by such lender or investor on the security of
such property or asset. 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" means any of the Securities, as defined in the recitals
of this Indenture, that are authenticated and delivered under this Indenture.
For all purposes of this Indenture, the "Securities" shall include the Initial
Securities initially issued on January 29, 1998 and any Exchange Securities to
be issued and exchanged for any Initial Securities pursuant to the Registration
Agreement and this Indenture and any other Notes issued after January 29,
22
1998 under this Indenture. For purposes of this Indenture, all Securities shall
vote together as one series of Securities under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Senior Notes" means the Company's 10 7/8% Series B Senior Notes Due
2007 which were issued on August 28, 1997 to exchange the Company's 10 7/8%
Senior Notes Due 2007, issued on March 31, 1997, and 9.47% Senior Discount Notes
Due 2007 which were issued on October 15, 1997.
"Senior Note Indentures" means (i) the Indenture dated March 31, 1997
between the Company and Bankers Trust Company, as trustee thereunder, relating
to the Company's 10 7/8% Senior Notes Due 2007 (which were subsequently
exchanged for the Company's 10 7/8% Series B Senior Notes Due 2007) and (ii) the
Indenture dated October 15, 1997 between the Company and Bankers Trust Company,
as trustee thereunder, relating to the Company's 9.47% Senior Discount Notes due
2007.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Agreement.
"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 any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal amount at maturity of such Security or
such installment of interest is due and payable.
"Strategic Investor" means a Corporation, partnership or other entity
engaged in one or more Telecommunications Businesses that has, or 80% or more of
the Voting Stock of which is owned by a Person that has, an equity market
capitalization, at the time of its initial Investment in the Company or in a
Permitted Joint Venture with the Company, in excess of $2 billion.
"Subordinated Debt" means Debt of the Company 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 of the
Securities to at least the
23
following extent: (i) no payments of principal of (or premium, if any) or
interest on or otherwise due in respect of such Debt may be permitted for so
long as any default in the payment of principal or Accreted Value (or premium,
if any) or interest on the Securities exists; (ii) in the event that any other
Default exists with respect to the Securities, upon notice by 25% or more in
principal amount at maturity of the Securities, to the Trustee, the Trustee
shall have the right to give notice to the Company and the holders of such Debt
(or trustees or agents therefor) of a payment blockage, and thereafter no
payments of principal of (or premium, if any) or interest on or otherwise due in
respect of such Debt may be made for a period of 179 days from the date of such
notice; and (iii) 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 a 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 of the Company pursuant to provisions
substantially similar to those described in Section 1010 (and which shall
provide that such Debt shall 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 of Section 1010).
"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 Assets" means all assets, rights (contractual or
otherwise) and properties, whether tangible or intangible, used or intended for
use in connection with a Telecommunications Business.
"Telecommunications Business" means the business of (i) transmitting,
or providing services relating to the transmission of, voice, data or video
through owned or leased transmission facilities, (ii) constructing, creating,
developing or marketing communications related network equipment, software and
other devices for use in a telecommunications business or (iii) evaluating,
participating or pursuing any other activity or opportunity that is
24
primarily related to those identified in (i) or (ii) above, provided that the
determination of what constitutes a Telecommunications 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 any Subsidiary of the Company
designated as such pursuant to and in compliance with Section 1021.
"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.
"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.
25
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than pursuant to
Section 1009(a)) 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 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.
26
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 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
27
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 eleven 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.
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 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
Market Services, or
(2) the Company 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
addressed to it at the address of its 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 sufficiently 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. Any notice mailed to a Holder in the manner herein prescribed
shall be conclusively deemed to have been received by such Holder, whether or
not such Holder actually receives such notice. 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
28
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.
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.
SECTION 112. Conflict with Trust Indenture Act.
---------------------------------
Prior to the issuance of the Exchange Securities or the effectiveness
of the Shelf Registration Statement, the Trust Indenture Act shall apply as a
matter of contract to this
29
Indenture for purposes of interpretation, construction and defining the rights
and obligations hereunder. Upon the issuance of the Exchange Securities or the
effectiveness of the Shelf Registration Statement, this Indenture shall be
subject to the provisions of the Trust Indenture Act that are required to be
part of this Indenture and shall, to the extent applicable, be governed by such
provisions. 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 principal or 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 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, as such, shall have any liability for any obligations of the Company
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. 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.
30
SECTION 116. Exhibits.
--------
All exhibits attached hereto are by this reference made a part hereof
with the same effect as if herein set forth in full.
SECTION 117. Counterparts.
------------
This Indenture may be executed in any number of counterparts, each of
which shall be 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.
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
31
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 $450,505,000,
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, 1010, 1018 or 1108.
The Initial Securities shall be known and designated as the "8.29%
Senior Discount Notes Due 2008" and the Exchange Securities shall be known as
the "8.29% Series B Senior Discount Notes". The Stated Maturity of the
Securities shall be February 1, 2008. The Securities shall accrete at the rate
of 8.29% per annum, compounded semiannually, to an aggregate principal amount of
$450,505,000 by February 1, 2003, and shall bear cash interest at the rate of
8.29% per annum accruing from February 1, 2003 or from the most recent Interest
Payment Date to which cash interest has been paid or duly provided for, payable
initially on August 1, 2003 and semiannually thereafter on February 1 and August
1, in each year and at said Stated Maturity, until the principal amount at
maturity thereof is paid or duly provided for; provided, however, that the
Company may elect, upon not less than 60 days' prior notice to the Holders and
the Trustee in accordance with Section 105 and Section 106 hereof, to commence
the accrual of cash interest on all Outstanding Securities on any August 1 or
February 1 on or after February 1, 2001 and prior to February 1, 2003, in which
case the Outstanding principal amount at Stated Maturity of each Security will
on such commencement date be reduced to the Accreted Value of such Security as
of such date and cash interest shall be payable with respect to such Security on
each August 1 and February 1 thereafter. Interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months.
Principal or 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.
32
The interest rate on the Securities is subject to increase by the
addition of Liquidated 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.
The Securities will be senior unsecured obligations of the Company,
ranking pari passu in right of payment with all existing and future senior
unsecured Debt of the Company, and will be senior in right of payment to all
existing and future Subordinated Debt of the Company.
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 Chief
Executive Officer, its President or a Vice President under its corporate seal
reproduced thereon. 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. The seal of the Company may be in the form of a facsimile thereof
and may be impressed, affixed, 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. In addition, any Security may
be signed on behalf of the Company by such Persons as, at the actual date of the
execution of such Security, shall be the proper officers of the Company,
although at the date of such Security or of the execution of this Indenture any
such Person was not such officer.
33
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 Securities for original issue in an
aggregate principal amount at maturity not to exceed $450,505,000 upon receipt
of a Company Order, which shall, specify the amount of Securities to be
authenticated, the names of the persons in which such Securities shall be
registered and the date on which such Securities are to be authenticated and
direct the Trustee to authenticate such Securities together with an Officers'
Certificate certifying that all conditions precedent to the issuance of such
Securities contained herein have been complied with. The aggregate principal
amount at maturity of Securities Outstanding at any time shall not exceed
$450,505,000, except as provided in Section 304.
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 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 (or such other accounts as they may direct),
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 represented by a Regulation S
Global Security will not be exchangeable for Physical Securities until the
expiration of the "40-day restricted period" within the meaning of Rule
903(c)(3) of Regulation S under the Securities Act.
34
In case the Company, pursuant to Article Eight, shall be consolidated
or merged with or into any other Person or shall convey, transfer, lease or
otherwise dispose of its properties and assets substantially as an entirety to
any 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 conveyance, transfer, lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article Eight, any of the Securities authenticated
or delivered prior to such consolidation, merger, conveyance, transfer, lease or
other disposition may, from time to time, at the request of the successor
Person, be exchanged for other Securities executed in the name of the successor
Person with such changes in phraseology and form as may be appropriate, but
otherwise in substance of like tenor as the Securities surrendered for such
exchange and of like principal amount; and the Trustee, upon Company Request of
the successor Person, shall authenticate and deliver Securities as specified in
such request for the purpose of such exchange. If Securities shall at any time
be authenticated and delivered in any new name of a successor Person pursuant to
this Section 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.
35
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 it may prescribe, the Company shall provide for the registration
of Securities and of transfers and exchange 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 and exchanges 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 Section 1002, the Company
shall execute, the Trustee shall authenticate and deliver, and the Security
Registrar shall register, if the requirements, of such transfer are met, 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 (including an exchange of Initial Securities for Exchange
Securities), 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, the Trustee shall authenticate and deliver, and the Security
Registrar shall register, the Securities which the Holder making the exchange is
entitled to receive, provided that no exchange of Initial Securities for
Exchange Securities shall occur until an Exchange Offer Registration Statement
shall have been declared effective by the Commission (confirmed in an Officer's
Certificate) and that the Initial Securities to be exchanged for the Exchange
Securities shall be cancelled by the Trustee.
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.
36
No service charge shall be made for any registration of transfer or
exchange or redemption of Securities, but the Company may require payment of a
sum sufficient to cover any tax or other 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, 1010, 1018 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 as may be required by them to
save each of them harmless, then, in the absence of 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
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.
37
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 having been
such Holder, and such defaulted interest and (to 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
38
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.
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 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 principal or 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 be 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
39
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 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 delivered to
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 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 impair, as between the Depository
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a beneficial owner 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
40
interests in 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, in each case 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 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 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.
(d) Any Physical Security delivered in exchange for an interest in a
Global Security pursuant to paragraph (c) of this Section 312 shall, except as
otherwise provided by (b)(1)(x) and paragraph (d) of Section 313, bear the
legend regarding transfer restrictions applicable to the Physical Securities set
forth in Exhibit A.
(e) 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.
SECTION 313. Special Transfer Provisions.
---------------------------
(a) Transfers to Non-QIB Institutional Accredited Investors. The
-------------------------------------------------------
Initial Securities shall not be transferred to any Person that is not a QIB or a
non-U.S. Person.
(b) Transfers to Non-U.S. Persons. The following provisions shall
-----------------------------
apply with respect to the registration of any proposed transfer of an Initial
Security to any non-U.S. person:
(1) the Security Registrar shall register the transfer of any Initial
Security if (x) the requested transfer is not prior to the date which is
two years (or such shorter
41
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 Initial Security (or of any Predecessor Security) or the last day
on which the Company or any Affiliate of the Company was the owner of such
Initial Security or any Predecessor Security or (y) the proposed transferee
has delivered to the Security Registrar a certificate substantially in the
form of Exhibit B hereto; and
(2) the Security Registrar shall register the transfer of any Initial
Security if the proposed transferor is an Agent Member holding a beneficial
interest in a Rule 144A Global Security, upon receipt by the Security
Registrar of (x) the certificate, if any, required by paragraph (1) above
and (y) instructions given in accordance with the Depository's and the
Security Registrar's procedures;
whereupon the Security Registrar shall reflect on its books and records the date
of such transfer and (A) (if the transfer involves a transfer of a beneficial
interest in a Rule 144A Global Security) a decrease in the principal amount of
such Rule 144A Global Security in an amount equal to the principal amount to be
transferred and (B) an increase in the principal amount of a Regulation S Global
Security in an amount equal to the principal amount to be transferred.
(c) Private Placement Legend. Upon the registration of transfer,
------------------------
exchange or replacement of Initial Securities, the Security Registrar shall
deliver only Initial Securities that bear the Private Placement Legend unless
(i) (x) the circumstances contemplated by clause (b)(1)(x) of this Section 313
exist or (y) such Security has been sold pursuant to an effective registration
statement under the Securities Act and (ii) 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.
(d) Other Transfers. If a Holder proposes to transfer an Initial
---------------
Security pursuant to any exemption from the registration requirements of the
Securities Act other than as provided for by Section 313(a) and 313(b), 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; provided that the Company may, based upon the opinion of its counsel,
instruct the Security Registrar by a Company Order not to register such transfer
in any case where the proposed transferee is not a QIB or a non-U.S. person.
(e) General. By its acceptance of any Security bearing the Private
-------
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of
42
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, after which time such letters, notices and other
written communications shall at the written request of the Company be delivered
to the Company. 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 upon Company Request cease to be of further
effect (except as to surviving rights of registration of transfer or exchange 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 Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and (ii)
Securities for whose payment money has theretofore been deposited in
trust with the Trustee or any Paying Agent or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust as provided in Section 1003) have been
delivered to the Trustee for cancellation; or
(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 at their Stated Maturity
within one year, or
43
(iii) are to be called for redemption within one year under
irrevocable arrangements satisfactory to the Trustee 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 as
trust funds in trust for such purpose an amount sufficient to pay and
discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal (and premium,
if any) and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(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 of the Company to the Trustee under Section 607 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 principal (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.
44
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) default in the payment of the principal or Accreted Value of (or
premium, if any, on) any Security at its Maturity; or
(2) default in the payment of any interest on any Security when it
becomes due and payable, and continuance of such default for a period of 30
days; or
(3) default in the payment of principal or Accreted Value and interest
on any Security required to be purchased pursuant to an Offer to Purchase
pursuant to Section 1010 or 1018; or
(4) default in the performance, or breach, of Section 801 or 1018; or
(5) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture or in any Security (other than a covenant
or warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with), and continuance of such default or
breach for a period of 60 days after there has been given, by registered or
certified mail, to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in aggregate principal amount at
maturity of the Outstanding Securities a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(6) a default or defaults under any bond(s), debenture(s), note(s) or
other evidence(s) of indebtedness by the Company or any Restricted
Subsidiary or under any mortgage(s), indenture(s) or instrument(s) under
which there may be issued or by which there may be secured or evidenced any
indebtedness of such type by the Company or any such Restricted Subsidiary
with a principal amount then outstanding, individually or in the aggregate,
in excess of $10 million, whether such indebtedness now exists or shall
hereafter be created, which default or defaults shall result in the
acceleration of the payment of such indebtedness or shall constitute a
failure to pay the principal of
45
such indebtedness when due at the final maturity thereof, or shall have
resulted in excess of $10 million of indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise have
become due and payable (after expiration of any applicable grace period);
or
(7) a final judgment or final judgments for the payment of money are
entered against the Company or any Restricted Subsidiary in an aggregate
amount in excess of $10 million by a court or courts of competent
jurisdiction, which judgment or judgments remain undischarged or unbonded
for a period (during which execution shall not be effectively stayed) of 45
days after the right to appeal all such judgments has expired; or
(8) the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Company or any Restricted 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 Restricted Subsidiary under the Federal Bankruptcy Code
or any other applicable federal or state law, or appointing a receiver,
liquidator, assignee, trustee or sequestrator (or other similar official)
of the Company or any Restricted 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
(9) the institution by the Company or any Restricted 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
or state law, or the consent by it to the filing of any such petition or to
the appointment of a receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) of the Company or any Restricted
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(8) or (9)) occurs and is continuing, then and in every such case the
Trustee or the Holders of not less than 25% in principal amount at maturity of
the Outstanding Securities may declare the principal of all the Securities to be
due and payable immediately in an amount equal to the Accreted Value of the
Securities as of the date on which the Securities first become due and payable
(plus any accrued and unpaid interest and premium, if any, not otherwise
included in the Accreted Value to such date), by a notice in writing to the
Company (and to the Trustee if given by Holders), and upon any such declaration
such principal shall become immediately due and payable. If an Event of Default
specified in Section 501(8) or (9) occurs and is continuing, then the principal
of all the Securities shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder in
an amount equal to the Accreted Value of the Securities as of the date on which
the Securities first become due and payable (plus any accrued and unpaid
interest and premium, if any, not otherwise
46
included in the Accreted Value to such date). 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 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 principal at maturity 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 principal at
maturity 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
(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
principal or 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.
Notwithstanding the preceding paragraph, in the event that a
declaration of acceleration in respect of the Securities due to an Event of
Default specified in Section 501(6)
47
shall have occurred and be continuing, such declaration of acceleration shall be
automatically annulled if the Debt that is the subject of such Event of Default
has been discharged or the holders thereof have rescinded their declaration of
acceleration in respect of such Debt, and written notice of such discharge or
rescission, as the case may be, shall have been given to the Trustee by the
Company and countersigned by the holders of such Debt or a trustee, fiduciary or
agent for such holders, within 30 days after such declaration of acceleration in
respect of the Securities, and no other Event of Default has occurred during
such 30-day period which has not been cured or waived during such period.
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 installment of interest on
any Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(b) default is made in the payment of the principal or Accreted Value
of (or premium, if any, on) any Security at the Maturity thereof,
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 principal or Accreted Value (and premium, if any) and interest,
and interest on any overdue principal or 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
48
rights, whether for the specific enforcement of any covenant or agreement in
this Indenture or in aid of the exercise of any power granted herein, or 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 principal 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 principal, 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 principal at
maturity (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.
49
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 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 principal or
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
principal or 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 principal
or 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, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee 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 to
the Trustee to
50
institute proceedings in respect of such Event of Default in its own name
as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee indemnity
reasonably satisfactory to it against the costs, expenses and liabilities
to be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority or
more in aggregate principal amount at maturity of the Outstanding
Securities;
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 Principal,
----------------------------------------------------
Premium and Interest.
--------------------
Notwithstanding any other provision in this Indenture, 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 principal and 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
51
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 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 not less than 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
which 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.
52
SECTION 513. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in aggregate 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 respect of the payment of the principal or 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.
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 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
53
(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 man would exercise or use under the circumstances in the conduct of his
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;
(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.
54
SECTION 602. Notice of Default.
-----------------
Within 60 days after the occurrence of any Default hereunder, the
Trustee shall transmit, in the manner and to the extent provided in TIA Section
313(c), notice of such Default hereunder known to any Responsible Officer of the
Trustee, unless such Default shall have been cured or waived; provided, however,
that, except in the case of a Default in the payment of the principal or
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 or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interest of the Holders; and provided
further that in the case of any Default of the character specified in Section
501(5) no such notice to Holders shall be given until at least 30 days after the
occurrence thereof.
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;
55
(5) 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;
(6) 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 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;
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder;
(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; and
(9) the Trustee shall have no duties, obligations or liability in
connection with any Event of Default hereunder unless a Responsible Officer
of the Trustee has knowledge thereof.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
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
56
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);
(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
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 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
57
indemnify and hold harmless the Trustee shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this Indenture or
the earlier resignation or removal of the Trustee. 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 principal or
Accreted Value of (and premium, if any) or interest on particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 501(8) or (9), 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 or state 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 Corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of federal, state, territorial
or District of Columbia supervising or examining authority, then, for the
purposes of this Section 608, the combined capital and surplus of such
Corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
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 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
58
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,
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,
within one year 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, 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
59
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 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.
SECTION 611. Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business.
--------
Any Corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any Corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
Corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such Corporation 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 or consolidation 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
60
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 or consolidation.
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).
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).
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 1008.
61
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 (other
than a merger of Qwest Corporation into the Company in which the Company shall
be the surviving Person) or (ii) directly or indirectly, transfer, sell, lease
or otherwise dispose of all or substantially all of its assets to any other
Person or Persons, unless, in any such transaction specified in clause (i) or
(ii):
(1) in a transaction in which the Company is not the surviving Person
or in which the Company sells, leases 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 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, 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 other successor entity to the
Company) 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 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 (including any successor entity to the Company) could Incur at
least $1.00 of additional Debt pursuant to the provisions of paragraph (a)
of Section 1011;
(5) if, as a result of any such transaction, property or assets of the
Company would become subject to a Lien prohibited by the provisions of
Section 1015, the
62
Company or the successor entity to the Company shall have secured the
Securities as required by such Section 1015; and
(6) 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,
conveyance, transfer, lease or acquisition 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 Substituted.
---------------------
Upon any consolidation of the Company with or merger of the Company
with or into any other Corporation or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety to any Person
or Persons in accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such conveyance,
transfer or lease 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, in the event of any such conveyance or transfer, the 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
discharged of all obligations and covenants under this Indenture and the
Securities and may be dissolved and liquidated.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form and substance
satisfactory to the Trustee, for any of the following purposes:
63
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company
contained 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 herein conferred upon the
Company; or
(3) to add any additional Events of Default; or
(4) to provide for uncertificated Notes in addition to or in place of
certificated Notes; or
(5) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee pursuant to the requirements of Section
610; or
(6) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Indenture; provided that such action shall not adversely affect
the interests of the Holders in any material respect; or
(7) to secure the Securities pursuant to the requirements of Section
1016.
SECTION 902. Supplemental Indentures with Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than a majority in
aggregate principal amount at maturity of the Outstanding Securities, by Act of
said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture or
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
of modifying in any manner the rights of the Holders under this Indenture;
provided, however, 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 principal or Accreted Value of
or any installment of interest on any Security, or alter the redemption
provisions thereof, or reduce the principal amount or Accreted Value
thereof (or premium, if any) or the rate of interest thereon or reduce the
amount of the principal at maturity of the Securities that would be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant
to Section 502 or the amount thereof provable in bankruptcy pursuant to
Section 504, or change the place of payment where, or the coin or currency
in which
64
any Security or any premium or the interest thereon is payable, or impair
the right to institute suit for the enforcement of any such payment on or
after the Stated Maturity thereof (or, in the case of redemption, on or
after the Redemption Date); or
(2) reduce the percentage in aggregate principal amount at maturity of
the Outstanding Securities the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences provided for in this
Indenture; or
(3) subordinate in right of payment, or otherwise subordinate, the
Notes to any other Debt; or
(4) modify any provision of the Indenture relating to the calculation
of Accreted Value; or
(5) modify any of the provisions of this Section 902, except to
increase any such percentage or to provide that certain other provisions of
this Indenture cannot be modified or waived without the consent of the
Holder of each Outstanding Security affected thereby.
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
65
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 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 the provisions of Section 902, the Company
shall give notice thereof to the Holders of each Outstanding Security affected,
in the manner provided for in Section 106, setting forth in general terms the
substance of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if Any, and Interest.
---------------------------------------------------
The Company covenants and agrees for the benefit of the Holders that
it shall duly and punctually pay the principal or Accreted Value of (and
premium, if any) and interest on the Securities in accordance with the terms of
the Securities and this Indenture.
66
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 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 principal or 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 principal or 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 principal or Accreted
Value of (or premium, if any) or interest on any Securities, deposit with a
Paying Agent a sum sufficient to pay the principal or 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 principal or 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.
67
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 principal or
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
principal or 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.
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 principal or Accreted Value of,
premium, if any, or interest on any Security and remaining unclaimed for two
years after such principal, 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
68
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; 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 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. Payment of Taxes and Other Claims.
---------------------------------
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (a) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Restricted
Subsidiary or upon the income, profits or property of the Company or any
Restricted Subsidiary and (b) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon the property of the
Company or any Restricted Subsidiary; provided, however, that the Company shall
not be required to pay or discharge or cause to be paid or discharged any such
tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.
SECTION 1006. 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 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 Section 1006 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.
69
SECTION 1007. 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 Corporations
similarly situated and owning like properties.
SECTION 1008. Provision of Financial Statements.
---------------------------------
The Company will file with the Trustee on the date on which it files
them with the Commission copies of the annual and quarterly reports and the
information, documents, and other reports that the Company is required to file
with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act ("SEC
Reports"). In the event the Company shall cease to be required to file SEC
Reports pursuant to the Exchange Act, the Company will nevertheless continue to
file such reports with the Commission (unless the Commission will not accept
such a filing) and the Trustee. The Company will furnish copies of the SEC
Reports to the holders of Notes at the time the Company is required to file the
same with the Trustee and will make such information available to investors who
request it in writing.
SECTION 1009. Statement by Officers as to Default.
-----------------------------------
(a) The Company shall deliver to the Trustee, on the date of delivery
of each quarterly report to be delivered pursuant to Section 1008, 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 with all conditions and covenants under this Indenture. For purposes
of this Section 1009(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 $5,000,000), the Company shall 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 within five Business Days of its occurrence.
SECTION 1010. Purchase of Securities upon Change of Control.
---------------------------------------------
(a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require that the Company repurchase such Holder's Securities in
whole or in part in
70
integral multiples of $1,000 principal amount at maturity, in accordance with
the procedures set forth in this Section 1010 and this Indenture.
(b) Within 30 days of the occurrence of a Change of Control, the
Company shall mail an Offer with respect to 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 any accrued and unpaid interest thereon and
premium, if any, not otherwise included in the Accreted Value to such purchase
date. Installments of interest (including Liquidated Interest) whose Stated
Maturity is on or prior to the Purchase 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. Each Holder shall be entitled to tender all or
any portion of the Securities owned by such Holder pursuant to the Offer to
Purchase, subject to the requirement that any portion of a Security tendered
must be tendered in an integral multiple of $1,000 principal amount at maturity.
(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) 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 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 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 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.
(d) A "Change of Control" shall be deemed to have occurred at such
time as (i) a Rating Decline shall have occurred and (ii) either (A) the sale,
conveyance, transfer or lease of all or substantially all of the assets of the
Company to any Person or any Persons acting together that would constitute a
"group" (a "Group") for purposes of Section 13(d) of the Exchange Act, together
with any Affiliates or Related Persons thereof, other than any Permitted Holder
or any Restricted Subsidiary, shall have occurred; (B) any Person or Group,
together with any Affiliates or Related Persons thereof, other than any
Permitted Holder or any Restricted Subsidiary, shall beneficially own (within
the meaning of Rule 13d-3 under the Exchange Act, except that a Person shall be
deemed to have beneficial ownership of all shares that such Person has the right
to acquire, whether such right is exercisable immediately or only after the
passage of time) at least 50% of the aggregate voting power of all classes of
Voting
71
Stock of the Company at a time when Permitted Holders own less than or
equal to 25% of the aggregate voting power of all classes of Voting Stock of the
Company; or (C) during any period of two consecutive years, Continuing Directors
cease for any reason to constitute a majority of the Board of Directors then in
office.
(e) 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.
SECTION 1011. Limitation on Consolidated Debt.
-------------------------------
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, Incur any Debt, unless, after giving effect to the application of
the 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 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 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, determined on a pro forma basis as if any such Debt had been Incurred
and the proceeds thereof had been applied at the beginning of such four fiscal
quarters, would be less than 5.5 to 1.0 for Debt Incurred on or prior to April
1, 2000 and 5.0 to 1.0 for Debt Incurred thereafter, or (ii) the Company's
Consolidated Capital Ratio 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 proceeds thereof, is less than 2.0 to 1.0.
(b) Notwithstanding the foregoing limitation, the Company and 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 and any Restricted
Subsidiary Guarantee;
(ii) (A) Debt Incurred subsequent to March 31, 1997 under Credit
Facilities in an aggregate principal amount at any time outstanding not to
exceed $150 million plus (B) Debt Incurred subsequent to March 31, 1997
under one or more Credit Facilities that are revolving credit facilities in
an aggregate principal amount at any time outstanding not to exceed the
greater of (x) $100 million or (y) 85% of Eligible Receivables;
72
(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 or improvement of the applicable
Telecommunications Assets;
(iv) 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
upon either (x) the transfer 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) the
issuance (other than directors' qualifying shares), sale, lease, transfer
or other disposition of shares of Capital Stock (including by consolidation
or merger) of such Restricted Subsidiary to a Person other than the Company
or another such Restricted Subsidiary, the provisions of this clause (iv)
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 or
other disposition;
(v) Debt Incurred to renew, extend, refinance, defease or refund
(each, a "refinancing") the Securities, the Senior Notes or Debt of the
Company Incurred pursuant to clause (iii) of this paragraph (b), in an
aggregate principal amount not to exceed the aggregate principal amount 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, however, that Debt the proceeds of which are used to
refinance the Securities or Debt which is pari passu to the Securities or
Debt which is subordinate in right of payment to the Securities shall only
be permitted under this clause (v) if (A) in the case of any refinancing of
the Securities or Debt which is pari passu to the Securities, the
refinancing Debt is made pari passu to the Securities or constitutes
Subordinated Debt, and, in the case of any refinancing of Subordinated
Debt, the refinancing Debt constitutes Subordinated Debt, and (B) in any
case, 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
73
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 a 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 1010;
(vi) Debt consisting of Permitted Interest Rate and Currency
Protection Agreements;
(vii) Debt secured by Receivables originated by the Company or any
Restricted Subsidiary and related assets, provided that such Debt is
nonrecourse to the Company and any of its other Restricted Subsidiaries and
provided further that Receivables shall not be available at any time to
secure Debt of the Company under this clause (vii) to the extent that they
are used at such time as the basis for the Incurrence of Debt in excess of
$100 million pursuant to clause (ii)(B)(y) of this paragraph (b); and
(viii) Debt not otherwise permitted to be Incurred pursuant to
clauses (i) through (vii) above, which, together with any other outstanding
Debt Incurred pursuant to this clause (viii), has an aggregate principal
amount not in excess of $25 million at any time outstanding.
SECTION 1012. Limitation on Debt and Preferred Stock of Restricted
----------------------------------------------------
Subsidiaries.
------------
The Company shall not permit any Restricted Subsidiary that is not a
Guarantor to Incur any Debt or issue any Preferred Stock except any and all of
the following (each of which shall be given independent effect):
(i) Restricted Subsidiary Guarantees;
(ii) Debt of Restricted Subsidiaries under Credit Facilities
permitted to be Incurred pursuant to clause (ii) of paragraph (b) of
Section 1011;
(iii) Purchase Money Debt of Restricted Subsidiaries permitted to be
Incurred pursuant to clause (iii) of paragraph (b) of Section 1011;
(iv) Debt owed by a Restricted Subsidiary of the Company to the
Company or a Restricted Subsidiary of the Company permitted to be Incurred
pursuant to clause (iv) of paragraph (b) of Section 1011;
74
(v) Debt of Restricted Subsidiaries consisting of Permitted
Interest Rate and Currency Protection Agreements permitted to be Incurred
pursuant to clause (vi) of paragraph (b) of Section 1011;
(vi) Debt of Restricted Subsidiaries secured by Receivables
originated by the Company or any Restricted Subsidiary and related assets
permitted to be Incurred pursuant to clause (vii) of paragraph (b) of
Section 1011;
(vii) Debt of Restricted Subsidiaries permitted to be Incurred
pursuant to clause (viii) of paragraph (b) of Section 1011;
(viii) Preferred Stock issued to and held by the Company or a
Restricted Subsidiary;
(ix) Debt Incurred or Preferred Stock issued 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 or Preferred Stock was not Incurred or issued in anticipation of such
transaction and was outstanding prior to such transaction; and
(x) Debt or Preferred Stock which is exchanged for, or the
proceeds of which are used to renew, extend, refinance, defease, refund or
redeem, any Debt of a Restricted Subsidiary permitted to be Incurred
pursuant to clause (iii) of this Section 1012 or any Debt or Preferred
Stock of a Restricted Subsidiary permitted to be Incurred pursuant to
clause (ix) of this Section 1012 (or any extension or renewal thereof) (for
purposes hereof, a "refinancing"), in an aggregate principal amount, in the
case of Debt, or with an aggregate liquidation preference, in the case of
Preferred Stock, not to exceed the aggregate principal amount of the Debt
so refinanced or the aggregate liquidation preference of the Preferred
Stock so refinanced, plus the amount of any premium required to be paid in
connection with such refinancing pursuant to the terms of the Debt or
Preferred Stock so refinanced or the amount of any premium reasonably
determined by the Company 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, and provided the Debt or Preferred Stock
Incurred or issued upon such refinancing, by its terms, or by the terms of
any agreement or instrument pursuant to which such Debt or Preferred Stock
is Incurred or issued, (x) does not provide for payments of principal or
liquidation value at the Stated Maturity of such Debt or Preferred Stock or
by way of a sinking fund applicable to such Debt or Preferred Stock or by
way of any mandatory redemption, defeasance, retirement or repurchase of
such Debt or Preferred Stock by
75
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 or Preferred Stock 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 or Preferred Stock at the option of the
holder thereof prior to the Stated Maturity of the Debt or Preferred Stock
being refinanced, other than a redemption or other retirement at the option
of the holder of such Debt or Preferred Stock (including pursuant to an
Offer to Purchase made by the Company or a Restricted Subsidiary) which is
conditioned upon the change of control of the Company pursuant to
provisions substantially similar to those contained in Section 1010, and
provided further that, in the case of any exchange or redemption of
Preferred Stock of a Restricted Subsidiary, such Preferred Stock may only
be exchanged for or redeemed with Preferred Stock of such Restricted
Subsidiary.
SECTION 1013. Limitation on Restricted Payments.
---------------------------------
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 any dividends or distributions payable solely in shares of
its Capital Stock (other than Disqualified Stock) or in options, warrants or
other rights to acquire its Capital Stock (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,
any Restricted Subsidiary or any Related Person of the Company (other than a
permitted refinancing) or (y) any options, warrants or rights to purchase or
acquire shares of Capital Stock of the Company, any Restricted Subsidiary or any
Related Person of the Company or any securities convertible or exchangeable into
shares of Capital Stock of the Company, any Restricted Subsidiary or any Related
Person of the Company (other than a permitted refinancing), except, in any such
case, any such purchase, redemption or retirement or acquisition for value paid
to the Company or a Restricted Subsidiary (or, in the event 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, paid
to the Company or a Restricted Subsidiary, or to the other stockholders of such
Restricted Subsidiary that is not a Wholly Owned Subsidiary, on a pro rata
basis); (iii) shall not make, or permit any Restricted Subsidiary to make, any
Investment in, or payment on a Guarantee of any obligation of, any Person, other
than the Company or a Restricted Subsidiary; and (iv) shall not, and shall not
permit any Restricted Subsidiary to, redeem, defease, repurchase, retire or
otherwise acquire
76
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 a permitted refinancing) (each of clauses (i) through
(iv) 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 the terms of paragraph (a) of Section 1011, or (3)
upon giving effect to such Restricted Payment, the aggregate of all Restricted
Payments from March 31, 1997 exceeds the sum of: (a) 50% of cumulative
Consolidated Net Income (or, in the event that Consolidated Net Income shall be
negative, 100% of such negative amount) since the end of the last full fiscal
quarter prior to March 31, 1997 through the last day of the last full fiscal
quarter ending at least 45 days prior to the date of such Restricted Payment,
(b) plus $5 million, (c) less, in the case of any Designation with respect to a
Restricted Subsidiary that was made after March 31, 1997, an amount equal to the
Designation Amount with respect to such Restricted Subsidiary, (d) plus, in the
case of any Revocation made after March 31, 1997, an amount equal to the lesser
of the Designation Amount with respect to the Subsidiary with respect to which
such Designation was made or the Fair Market Value of the Investment of the
Company and its Restricted Subsidiaries in such Subsidiary at the time of
Revocation; provided, however, that the Company or a Restricted Subsidiary of
the Company may make any Restricted Payment with the aggregate net cash proceeds
received after March 31, 1997 as capital contributions to the Company or from
the issuance (other than to a Subsidiary) of Capital Stock (other than
Disqualified Stock) of the Company and warrants, rights or options on Capital
Stock (other than Disqualified Stock) of the Company and the principal amount of
Debt of the Company that has been converted into Capital Stock (other than
Disqualified Stock and other than by a Subsidiary) of the Company after March
31, 1997.
Notwithstanding the foregoing limitation, (i) the Company and any
Restricted Subsidiary may make Permitted Investments; (ii) 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; (iii) 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 Affiliates,
provided that the aggregate amount of all such repurchases made pursuant to this
clause (iii) shall not exceed $1 million in any twelve-month period; (iv) the
Company and any Restricted Subsidiary may refinance any Debt otherwise permitted
by clause (v) of paragraph (b) of Section 1011 or clause (x) of Section 1012;
and (v) the Company and any Restricted Subsidiary may retire or repurchase any
Capital Stock of the Company or of any Restricted Subsidiary in exchange for, or
out of the proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of, Capital Stock (other than Disqualified Stock) of
the Company.
77
SECTION 1014. 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 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 to 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 or assets 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 any such encumbrance or restriction (i) pursuant to any agreement in
effect on March 31, 1997; (ii) any customary 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 the provisions of such agreement permit the
payment of interest and mandatory payment or prepayment of principal pursuant 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 net worth, leverage, invested capital and other
financial covenants, customary covenants regarding the merger of or sale of all
or any substantial part of the assets of the Company or any Restricted
Subsidiary, customary restrictions on transactions with Affiliates, and
customary subordination provisions governing Debt owed to the Company or any
Restricted Subsidiary; (iii) 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)
pursuant to an agreement effecting a renewal, refunding, permitted refinancing
or extension 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 renewal, refunding, permitted refinancing or extension
agreement relating to such encumbrance or restriction are no more restrictive in
any material respect than the provisions contained in the agreement the subject
thereof; (v) in the case of clause (iii) of paragraph (a) of this Section 1014,
restrictions 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) of this Section 1014, customary
nonassignment provisions entered into in the ordinary course of business in
leases and other agreements and customary restrictions contained in asset sale
agreements limiting the transfer of such property or assets pending the closing
of such sale; (vii) any restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement which has been entered into for the
78
sale or disposition of all or substantially all of the Capital Stock or assets
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 not consummated and that the
consummation or abandonment of such transaction occurs within one year of the
date such agreement was entered into; (viii) pursuant to applicable law; and
(ix) pursuant to this Indenture, the Securities, the Senior Notes and the Senior
Note Indentures.
SECTION 1015. Limitation on Liens.
-------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, Incur or suffer to exist any Lien on or with respect to any property or
assets now owned or acquired after March 31, 1997 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 which is subordinate in right of payment to the
Securities, prior to such Debt as to such property for so long as such Debt will
be so secured.
The foregoing restrictions shall not apply to: (i) Liens existing on
March 31, 1997 and securing Debt outstanding on March 31, 1997; (ii) Liens in
favor of the Company or any Restricted Subsidiary; (iii) Liens to secure the
Securities; (iv) Liens to secure Restricted Subsidiary Guarantees; (v) Liens to
secure Debt under Credit Facilities permitted to be Incurred pursuant to clause
(ii) of paragraph (b) of Section 1011; (vi) Liens on real or personal property
of the Company or a Restricted Subsidiary constructed, installed, acquired or
constituting improvements made after the date of original issuance of the
Securities to secure Purchase Money Debt permitted to be Incurred pursuant to
clause (iii) of paragraph (b) of Section 1011, provided, however, that (a) the
principal amount of any Debt secured by such a Lien does not exceed 100% of such
purchase price or cost of construction, installation or improvement of the
property subject to such Lien, (b) such Lien attaches to such property prior to,
at the time of or within 270 days after the acquisition, the completion of
construction, installation or improvement or the commencement of operation of
such property and (c) such Lien does not extend to or cover any property other
than the specific item of property (or portion thereof) acquired, constructed,
installed or constituting the improvements financed by the proceeds of such
Purchase Money Debt; (vii) Liens to secure Acquired Debt, provided, however,
that (a) such Lien attaches to the acquired asset prior to the time of the
acquisition of such asset and (b) such Lien does not extend to or cover any
other asset; (viii) Liens to secure Debt Incurred to extend, renew, refinance or
refund (or successive extensions renewals, refinancings or refundings), in whole
or in part, Debt secured by any Lien referred to in the foregoing clauses (i),
(iii), (iv), (v), (vi) and (vii) of this Section 1015 so long as such Lien does
not extend to any other property and the principal amount of Debt so secured is
not increased except as otherwise permitted under clause (v) of paragraph (b) of
Section 1011 or clause (x) of Section 1012; (ix) Liens to secure debt consisting
of Permitted Interest Rate and
79
Currency Protection Agreements permitted to be Incurred pursuant to clause (vi)
of paragraph (b) of Section 1011; (x) Liens to secure Debt secured by
Receivables permitted to be Incurred pursuant to clause (vii) of paragraph (b)
of Section 1011; (xi) Liens to secure Debt of Restricted Subsidiaries permitted
to be Incurred pursuant to clause (viii) of paragraph (b) of Section 1011; (xii)
Liens not otherwise permitted by the foregoing clauses (i) through (xi) in an
amount not to exceed 5% of the Company's Consolidated Tangible Assets; and
(xiii) Permitted Liens.
SECTION 1016. Limitation on Issuances of Certain Guarantees by, and
-----------------------------------------------------
Debt Securities of, Restricted Subsidiaries.
-------------------------------------------
The Company shall not (i) permit any Restricted Subsidiary to,
directly or indirectly, guarantee any Debt Securities of the Company or (ii)
permit any Restricted Subsidiary to issue any Debt Securities unless, in either
such case, such Restricted Subsidiary simultaneously executes and delivers a
Restricted Subsidiary Guarantee providing for a Guarantee of payment of the
Securities.
SECTION 1017. 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, other than a Sale and
Leaseback Transaction between the Company or a Restricted Subsidiary on the one
hand and a Restricted Subsidiary or the Company on the other hand, unless (i)
the Company or such Restricted Subsidiary would be entitled to Incur a Lien to
secure Debt by reason of the provisions of Section 1015, equal in amount to the
Attributable Value of the Sale and Leaseback Transaction, without equally and
ratably securing the Securities and (ii) the Sale and Leaseback Transaction is
treated as an Asset Disposition and all of the conditions of Section 1018
(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 1018.
SECTION 1018. 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 assets sold or disposed of as
determined by the Board of Directors in good faith and evidenced
80
by a Board Resolution; 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 (other than Debt that is subordinated to the Securities) or of the
Restricted Subsidiary and release from all liability on the Debt assumed. If the
aggregate of Net Available Proceeds within any twelve-month period exceeds $5
million, then all such Net Available Proceeds shall be applied within 360 days
of the last such Asset Disposition (1) first, to the permanent repayment or
reduction of Debt then outstanding under any Credit Facility, to the extent such
agreements would require such application or prohibit payments pursuant to
clause (2) following; (2) second, to the extent of remaining Net Available
Proceeds, to make an Offer to Purchase 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 thereon and premium, if any, not otherwise included
in the Accreted Value to such purchase date and, to the extent required by the
terms thereof, any other Debt of the Company that is pari passu with the
Securities at a price no greater than 100% of the principal amount thereof plus
accrued and unpaid interest to the purchase date (or 100% of the accreted value
plus accrued and unpaid interest and premium, if any, to the purchase date in
the case of original issue discount Debt); (3) third, to the extent of any
remaining Net Available Proceeds following the completion of the Offer to
Purchase, to the repayment of other Debt of the Company or Debt of a Restricted
Subsidiary, to the extent permitted under the terms thereof; and (4) fourth, to
the extent of any remaining Net Available Proceeds, to any other use as
determined by the Company which is not otherwise prohibited by this Indenture.
SECTION 1019. Limitation on Issuances 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 1018 to the extent such provisions
apply; (ii) in a transaction that results in such Restricted Subsidiary becoming
a Permitted Joint Venture, provided (x) such transaction complies with the
provisions of Section 1018 to the extent such provisions apply and (y) the
Company's remaining Investment in such Permitted Joint Venture would have been
permitted as a new Investment under the provisions of Section 1013; (iii) the
transfer, conveyance, sale or other disposition of shares required by applicable
law or regulation; (iv) if required, the issuance, transfer, conveyance, sale or
other disposition of directors' qualifying shares; or (v) Disqualified Stock
issued in exchange for, or upon conversion of, or the proceeds of the issuance
of which are used to redeem, refinance, replace or refund, shares of
Disqualified Stock of such Restricted Subsidiary, provided that the amounts of
the redemption
81
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, redeemed, refinanced, replaced or refunded.
SECTION 1020. Transactions with Affiliates and Related Persons.
------------------------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, enter into any transaction (or series of related transactions) with an
Affiliate or Related Person of the Company (other than the Company or a
Restricted Subsidiary), including any Investment, unless such transaction is on
terms no less favorable to the Company or such Restricted Subsidiary than those
that could be obtained in a comparable arm's-length transaction with an entity
that is not an Affiliate or Related Person and is in the best interests of the
Company or such Restricted Subsidiary, provided that the Company or any
Restricted Subsidiary may enter into: (i) transactions pursuant to the
Company's tax sharing agreement entered into with Anschutz Company existing at
the date of execution of this Indenture described under the caption "Certain
Transactions" in the Offering Memorandum, provided that any amendment of,
supplement to or substitute for such agreement is on terms that are no less
favorable to the Company or such Restricted Subsidiary than such existing
agreement; (ii) transactions pursuant to employee compensation arrangements
approved by the Board of Directors, either directly or indirectly; and (iii)
Receivables Sales between the Company or a Restricted Subsidiary and an
Affiliate of the Company or such Restricted Subsidiary, provided that such
Receivables Sales satisfy the provisions of clauses (i) and (ii) of Section
1018. For any transaction that involves in excess of $10 million but less than
or equal to $15 million, the Company shall deliver to the Trustee an Officers'
Certificate stating that the transaction satisfies the above criteria. For any
transaction that involves in excess of $15 million, a majority of the
disinterested members of the Board of Directors shall determine that the
transaction satisfies the above criteria and shall evidence such a determination
by a Board Resolution or, in the event that there shall not be disinterested
members of the Board of Directors with respect to the transaction, the Company
shall file with the Trustee a written opinion stating that the transaction
satisfies the above criteria 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.
SECTION 1021. 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 (a "Designation") unless:
82
(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 1011;
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 Fair Market Value of the net Investment of the
Company or any other Restricted Subsidiary in 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
1013 for all purposes of this Indenture in the Designation Amount. 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
property, (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 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 Section 1013 or 1020.
A Designation may be revoked (a "Revocation") by a Board Resolution,
provided that the Company shall 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 certifying compliance with the foregoing provisions.
83
SECTION 1022. No Repayment of Existing Parent Company Advances with
-----------------------------------------------------
the Proceeds of the Securities.
------------------------------
The Company shall not apply any portion of the proceeds of the
offering of the Securities toward the repayment of advances made to the Company
or any of its subsidiaries by any parent company of the Company outstanding at
the date of execution of this Indenture.
SECTION 1023. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1007 through 1022, inclusive,
if before or after the time for such compliance the Holders of at least a
majority in principal amount of the Outstanding Securities, by Act of such
Holders, waive such compliance in such instance with such term, provision or
condition, but no such waiver shall extend to or affect such term, provision or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such term, provision or condition shall remain in full force
and effect.
SECTION 1024. Trustee Not to Monitor Performance.
----------------------------------
The Trustee shall have no duty to confirm or monitor the performance
by the Company of its duties pursuant to the covenants set forth in this Article
Ten.
84
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 on or after
February 1, 2003, upon not less than 30 nor more than 60 days' prior notice,
subject to the conditions and at the redemption prices (expressed as percentages
of Accreted Value) set forth in the form of Security, plus accrued and unpaid
interest thereon (if any) to the Redemption Date. In addition, prior to
February 1, 2001, the Company may redeem the Securities subject to the
conditions set forth in the form of Security.
SECTION 1102. Applicability of Article.
------------------------
Redemption of Securities at the election of the Company or otherwise,
as permitted or required by any provision of this Indenture, shall be made in
accordance with such provision and this Article.
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. In case of any
redemption at the election of the Company, 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 principal amount at maturity 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.
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, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
of the principal amount at maturity 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.
85
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.
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
amount 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 principal amount at maturity thereof remaining
unredeemed,
(5) that on the Redemption Date the Redemption Price (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 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.
86
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.
---------------------------
Prior to any Redemption 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 accrued interest 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 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) 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 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 principal or Accreted Value (and premium,
if any) shall, until paid, accrete or bear interest from the Redemption Date at
the rate of accretion of and interest 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 principal amount at maturity equal to and in exchange
for the unredeemed portion of the principal amount at maturity of the Security
so surrendered.
87
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 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 rights of
Holders of Outstanding Securities to receive, solely from the trust fund
described in Section 1204 and as more fully set forth in such Section, payments
in respect of the principal or Accreted Value of, premium, if any, and interest
on such Securities when such payments are due (but not the Purchase Price
referred to in Section 1010) and any rights of the Holders with respect to such
amounts, (B) the Company's obligations with respect to such Securities under
Sections 304, 305, 306, 1002 and 1003, (C) the rights, powers, trusts, duties
and immunities of the Trustee hereunder 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.
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 Section 801(4) and in Sections 1007
through 1021 with respect to the Outstanding
88
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 or declaration or Act of Holders (and the consequences of any thereof)
in connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Outstanding Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant 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), 501(4) or 501(5), but, except as specified
above, the remainder of this Indenture and such Securities shall be unaffected
thereby.
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: (A)
money in an amount, or (B) Government Securities which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one day before the
due date of any 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, and
which shall be applied by the Trustee (or other qualifying trustee) to pay
and discharge, the principal or Accreted Value of (and premium, if any) and
interest on the Outstanding Securities on the Stated Maturity (or
Redemption Date, if applicable) of such principal or Accreted Value (and
premium, if any) or installment of interest; provided that the 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.
89
(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 (8) and (9) of Section 501 are concerned, at any time
during the period ending on the 91st 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 material 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 January 22, 1998 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 (i)
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 and (ii) the Company's deposit
will not result in the Trust or the Trustee being subject to regulation
under the Investment Company Act of 1940.
(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.
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
90
Trustee, in accordance with the provisions of such 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 Holders of such Securities of all sums due and to become due
thereon in respect of principal or Accreted Value, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
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 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 obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 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 with
Section 1205; provided, however, that if the Company makes any payment of
principal or Accreted Value of, premium, if any, or interest on any Security
following the reinstatement of its obligations, the Company 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.
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.
QWEST COMMUNICATIONS
INTERNATIONAL INC.
/s/
By:__________________________________
Title:
/s/
Attest:___________________________
Title:
BANKERS TRUST COMPANY, as Trustee
/s/
By:______________________________________
Title:
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.
[If a Rule 144A Security, then insert:] THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT (A)(1) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A") IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (2) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (3) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES.
A-2
[If a Regulation S Security, then insert:] THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, PRIOR TO THE EXPIRATION OF THE RESTRICTED PERIOD
(DEFINED AS 40 DAYS AFTER THE ISSUE DATE WITH RESPECT TO THE SECURITIES), MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S OR
(2) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, AND (B) IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES.
QWEST COMMUNICATIONS
INTERNATIONAL INC.
8.29% [Series B]* Senior Discount Note Due 2008
CUSIP: ________
No. __________ $_____________
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, AND THE RULES AND REGULATIONS THEREUNDER, THIS
SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT; FOR EACH $1,000 OF
PRINCIPAL AMOUNT (1) THE "ISSUE PRICE" IS $665.92; (2) THE "STATED REDEMPTION
PRICE AT MATURITY" IS $1,414.50; (3) THE AMOUNT OF ORIGINAL ISSUE DISCOUNT (THE
EXCESS OF THE "STATED REDEMPTION PRICE AT MATURITY" OVER THE "ISSUE PRICE") IS
$748.58; (4) THE ISSUE DATE IS JANUARY 29, 1998; (5) THE YIELD TO MATURITY
(COMPOUNDED SEMI-ANNUALLY) IS 8.29%; AND (6) THE METHOD USED TO DETERMINE YIELD
TO MATURITY IS THE EXACT METHOD.
Qwest Communications International Inc., 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
-----------------------
* Include only for Exchange Securities.
A-3
assigns, the principal sum of ____________________ Dollars [if a Global
Security, then insert: (which principal amount may from time to time be
increased or decreased to such other principal amounts which, taken together
with the principal amounts of all other Outstanding Securities, shall not exceed
$450,505,000 in the aggregate at any time, by adjustments made on the records of
the Trustee hereinafter referred to in accordance with the Indenture)] on
February 1, 2008, at the office or agency of the Company referred to below and
to pay cash interest thereon, semi-annually on February 1 and August 1 in each
year, initially on August 1, 2003, accruing from February 1, 2003 or from the
most recent Interest Payment Date to which cash interest has been paid or duly
provided for; provided, however, that the Company may elect, upon not less than
60 days' prior notice, to commence the accrual of cash interest on all
outstanding Securities on any February 1 or August 1 on or after February 1,
2001 and prior to February 1, 2003, in which case the outstanding principal
amount at maturity of each Security will on such commencement date be reduced to
the Accreted Value of this Security as of such date and cash interest shall be
payable with respect to this Security on each August 1 and February 1
thereafter. Except as otherwise described in this paragraph, interest on the
Securities will accrue at the rate of 8.29% per annum, until the principal
amount at maturity hereof is paid or duly provided for, and (to the extent
lawful) to pay on demand interest on any overdue interest at the rate borne by
the Securities from the date on which such overdue interest becomes payable to
the date payment of such interest has been made or duly provided for [provided,
however, that if (i) (a) Company has not filed a registration statement (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act") within 90 days after January 29, 1998, with respect to a
registered offer (the "Exchange Offer") to exchange this Security for a security
(an "Exchange Security") with terms identical in all material respects to this
Security (except that such security will not contain terms with respect to
registration rights or transfer restrictions, and provisions regarding interest
and Liquidated Interest (described below) will be modified or eliminated, as
appropriate), or (b) the Registration Statement has not been declared effective
within 150 days after January 29, 1998, or (c) the Exchange Offer has not been
consummated within 180 days after January 29, 1998; or (ii) in lieu thereof, the
Company has not filed a shelf registration statement (the "Shelf Registration
Statement") under the Securities Act within 210 days after January 29, 1998,
covering resales of this Security and such Shelf Registration Statement has not
been declared effective; or (iii) either the Registration Statement or, if
applicable, the Shelf Registration Statement is filed and declared effective but
shall thereafter cease to be effective or usable (subject to certain exceptions)
in connection with resales of this Security or Exchange Securities in accordance
with and during the periods specified in the Registration Agreement without
being succeeded promptly by an additional registration statement filed and
declared effective, in each case (i) through (iii) upon the terms and conditions
set forth in the Registration Agreement (each such event referred to in clauses
(i) through (iii), a "Registration Default"), then additional interest
("Liquidated Interest") will accrue (in addition to the accretion of principal
and any stated interest on the Securities) from and including the date on which
any such Registration Default shall occur to but excluding the date on which all
A-4
Registration Defaults have been cured. Liquidated Interest will be payable at a
rate per annum equal to 0.5% on the principal amount at maturity of the
Securities during the 90-day period immediately following the occurrence of any
Registration Default and shall increase by 0.25% per annum of the principal
amount at maturity of the Securities at the end of each subsequent 90-day
period, but in no event shall such rates exceed 2.00% per annum in the aggregate
regardless of the number of Registration Defaults. Accrued Liquidated Interest,
if any, shall be paid in cash semiannually on February 1 and August 1 in each
year; and the amount of accrued Liquidated Interest shall be determined on the
basis of the number of days actually elapsed. Any accrued and unpaid interest
(including Liquidated 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 Liquidated
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 January 15 or July 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 be paid at any time in
any other lawful manner, all as more fully provided in said Indenture. Payment
of the principal of (and premium, if any, on) 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.
---------------
** Include for Initial Securities and, if there has occurred a Registration
Default, include for Exchange Securities.
A-5
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.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: __________________ QWEST COMMUNICATIONS
INTERNATIONAL INC.
By: _______________________
Authorized Signatory
A-6
Form of Reverse of Security
---------------------------
This Security is one of a duly authorized issue of securities of the
Company designated as its 8.29% [Series B]* 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
$450,505,000, which may be issued under an indenture (herein called the
"Indenture") dated as of January 29, 1998 between the Company and Bankers Trust
Company, 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 were issued at a discount to their aggregate principal amount at
maturity and accrete at a rate of 8.29% per annum, compounded semiannually, to
an aggregate principal amount of $450,505,000 by February 1, 2003.
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 February 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, if
redeemed during the twelve months beginning February 1 of the years indicated
below:
YEAR REDEMPTION PRICE
---- ----------------
2003......................... 104.145%
2004......................... 102.763%
2005......................... 101.382%
2006 and thereafter.......... 100.000%
In addition, prior to February 1, 2001, the Company may redeem up to
35% of the Accreted Value at the redemption date of the Securities at a
redemption price equal to 108.29% of the Accreted Value of the Securities so
redeemed, plus accrued and unpaid interest thereon (if any) to the redemption
date, with the net proceeds of one or more Public Equity Offerings resulting in
gross proceeds of at least $100 million in the aggregate; provided that at least
65% of the Accreted Value of the originally issued Securities would remain
outstanding immediately after giving effect to such redemption.
------------------
* Include for Exchange Securities only.
A-7
Within 30 days of the occurrence of a Change of Control, the Company
will be required, subject to certain limitations provided in the Indenture, to
make an Offer to Purchase all Outstanding Securities at a purchase price in cash
in an amount equal to 101% of the Accreted Value of the Securities on the
purchase date plus any accrued and unpaid interest and premium, if any, not
otherwise included in the Accreted Value to such purchase 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
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.
If an Event of Default shall occur and be continuing, the principal
amount at maturity of all the Securities may be declared due and payable in the
manner and with the effect provided in the Indenture and in an amount equal to
the Accreted Value of the Securities as of the date on which the Securities
first become due and payable, plus any accrued and unpaid interest and premium,
if any, not otherwise included in the Accreted Value to such date.
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 the related 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 waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by or on behalf of the Holder of this Security shall
be conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange
A-8
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 principal or 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 registerable 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, will be issued to the designated transferee or
transferees.
The Securities are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, the Securities
are exchangeable for a like aggregate principal amount 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 Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to 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.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
A-9
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-10
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 this Security occurring prior to
the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act of 1933, as amended (the "Securities Act"), covering resales of this
Security (which effectiveness shall not have been suspended or terminated at the
date of the transfer) and (ii) the date two years (or such shorter period of
time as may be permitted by Rule 144(k) under the Securities Act or any
successor provision thereunder) after the later of the original issuance date
appearing on the face of this Security (or any Predecessor Security) or the last
date on which the Company or any Affiliate of the Company was the owner of this
Security (or any Predecessor Security), the undersigned confirms that it has not
utilized any general solicitation or general advertising in connection with the
transfer and that this Security is being transferred in compliance with the
exemption from registration under the Securities Act provided by Rule 144A
thereunder.
A-11
If the above is not correct, the Trustee or Security Registrar shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer or
registration set forth herein and in Section 313 of the Indenture shall have
been satisfied.
________________________________________________________________________________
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:__________________________
TO BE COMPLETED BY PURCHASER:
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
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
[The Transferee Certificates (Exhibit B to the Indenture) will be attached to
the Security]
A-12
Option of Holder to Elect Purchase
----------------------------------
If you wish to have this Security purchased by the Company pursuant to
Section 1010 or 1018 of the Indenture, check the box: [ ]
If you wish to have a portion of this Security purchased by the
Company pursuant to Section 1010 or 1018 of the Indenture, state the amount:
$_____________
Dated:______________________ Your Signature:__________________________
(Sign exactly as your name appears on the
other side of this Security)
EXHIBIT B
Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
----------------------------------------
[Date]
Bankers Trust Company
Four Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Market Services
Re: Qwest Communications International Inc. (the "Company") 8.29% Senior
Discount Notes Due 2008 (the "Securities")
--------------------------------------------------------------------
Dear Sirs:
In connection with our proposed sale of $___________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been pre-
arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities; and
B-2
(6) if the circumstances set forth in Rule 904(c) under the Securities
Act are applicable, we have complied with the additional conditions
therein, including (if applicable) sending a confirmation or other notice
stating that the Securities may be offered and sold: during the restricted
period specified in Rule 903(c)(2) or (3), as applicable; in accordance
with the provisions of Regulation S; pursuant to registration of the
Securities under the Securities Act; or pursuant to an available exemption
from the registration requirements under the Securities Act.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:__________________________
Authorized Signatory
