Exhibit 4.13
EXECUTION VERSION
MARQUEE HOLDINGS INC.
AND
HSBC BANK USA, NATIONAL ASSOCIATION
AS TRUSTEE
12% SENIOR DISCOUNT NOTES DUE 2014
INDENTURE
DATED AS OF AUGUST 18, 2004
TABLE OF CONTENTS
PAGE
ARTICLE I Definitions and Incorporation by Reference.........................................................1
Section 1.01. Definitions..............................................................................1
Section 1.02. Other Definitions.......................................................................19
Section 1.03. Incorporation by Reference of Trust Indenture...........................................19
Section 1.04. Rules of Construction...................................................................20
ARTICLE II The Securities...................................................................................20
Section 2.01. Amount of Securities; Issuable in Series................................................20
Section 2.02. Form and Dating.........................................................................21
Section 2.03. Execution and Authentication............................................................22
Section 2.04. Registrar and Paying Agent..............................................................22
Section 2.05. Paying Agent To Hold Money in Trust.....................................................23
Section 2.06. Securityholder Lists....................................................................23
Section 2.07. Replacement Securities..................................................................23
Section 2.08. Outstanding Securities..................................................................23
Section 2.09. Temporary Securities....................................................................24
Section 2.10. Cancellation............................................................................24
Section 2.11. Defaulted Interest......................................................................25
Section 2.12. CUSIP, Common Code or ISIN Numbers......................................................25
Section 2.13. Computation of Interest.................................................................26
ARTICLE III Redemption......................................................................................26
Section 3.01. Notices to Trustee......................................................................26
Section 3.02. Selection of Securities To Be Redeemed..................................................26
Section 3.03. Notice of Redemption....................................................................26
Section 3.04. Effect of Notice of Redemption..........................................................27
Section 3.05. Deposit of Redemption Price.............................................................27
Section 3.06. Securities Redeemed in Part.............................................................28
Section 3.07. Special Redemption......................................................................28
ARTICLE IV Covenants........................................................................................28
Section 4.01. Payment of Securities...................................................................28
Section 4.02. Corporate Existence.....................................................................28
Section 4.03. Payment of Taxes and Other Claims.......................................................29
Section 4.04. Maintenance of Properties...............................................................29
Section 4.05. Limitation on Consolidated Indebtedness.................................................29
Section 4.06. Limitation on Restricted Payments.......................................................30
Section 4.07. Limitation on Transactions with Affiliates..............................................32
Section 4.08. Future Guarantors.......................................................................33
Section 4.09. Limitation on Liens.....................................................................33
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Section 4.10. Change of Control.......................................................................33
Section 4.11. Provision of Financial Information......................................................34
Section 4.12. Statement as to Compliance..............................................................34
Section 4.13. Waiver of Certain Covenants.............................................................34
Section 4.14. Activities of Marquee Inc...............................................................35
Section 4.15. Further Instruments and Acts............................................................35
Section 4.16. Limitation on Ability of Company to Release Funds from Escrow...........................35
Section 4.17. Payment for Consent.....................................................................35
Section 4.18. Designation as "Designated Senior Debt".................................................35
ARTICLE V Successor Company.................................................................................35
Section 5.01. Consolidation...........................................................................35
Section 5.02. Successor Substituted...................................................................36
ARTICLE VI Defaults and Remedies............................................................................37
Section 6.01. Events of Default.......................................................................37
Section 6.02. Acceleration; Rescission and Annulment..................................................39
Section 6.03. Other Remedies..........................................................................40
Section 6.04. Waiver of Past Defaults.................................................................40
Section 6.05. Control by Majority.....................................................................40
Section 6.06. Limitation on Suits.....................................................................40
Section 6.07. Rights of Holders to Receive Payment....................................................41
Section 6.08. Collection Suit by Trustee..............................................................41
Section 6.09. Trustee May File Proofs of Claim........................................................41
Section 6.10. Priorities..............................................................................41
Section 6.11. Undertaking for Costs...................................................................42
Section 6.12. Waiver of Stay or Extension Laws........................................................42
ARTICLE VII Trustee.........................................................................................42
Section 7.01. Duties of Trustee.......................................................................42
Section 7.02. Rights of Trustee.......................................................................43
Section 7.03. Individual Rights of Trustee............................................................44
Section 7.04. Trustee's Disclaimer....................................................................44
Section 7.05. Notice of Defaults......................................................................44
Section 7.06. Reports by Trustee to Holders...........................................................45
Section 7.07. Compensation and Indemnity..............................................................45
Section 7.08. Replacement of Trustee..................................................................46
Section 7.09. Successor Trustee by Merger.............................................................47
Section 7.10. Eligibility; Disqualification...........................................................47
Section 7.11. Preferential Collection of Claims Against Company.......................................47
ARTICLE VIII Discharge of Indenture; Defeasance.............................................................48
Section 8.01. Discharge of Liability on Securities; Defeasance........................................48
Section 8.02. Conditions to Defeasance................................................................49
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Section 8.03. Application of Trust Money..............................................................50
Section 8.04. Repayment to Company....................................................................50
Section 8.05. Indemnity for Government Obligations....................................................50
Section 8.06. Reinstatement...........................................................................50
ARTICLE IX Amendments.......................................................................................51
Section 9.01. Without Consent of Holders..............................................................51
Section 9.02. With Consent of Holders.................................................................51
Section 9.03. Compliance with Trust Indenture Act.....................................................52
Section 9.04. Revocation and Effect of Consents and Waivers...........................................52
Section 9.05. Notation on or Exchange of Securities...................................................53
Section 9.06. Trustee To Sign Amendments..............................................................53
ARTICLE X Guarantee.........................................................................................53
Section 10.01. Subsidiary Guarantee...................................................................53
Section 10.02. Execution and Delivery of Subsidiary Guarantee for Future Guarantors...................55
Section 10.03. Limitation on Liability; Termination, Release and Discharge............................55
Section 10.04. Right of Contribution..................................................................57
Section 10.05. No Subrogation.........................................................................57
ARTICLE XI Miscellaneous....................................................................................57
Section 11.01. Trust Indenture Act Controls...........................................................57
Section 11.02. Notices................................................................................57
Section 11.03. Communication by Holders with Other Holders............................................58
Section 11.04. Certificate and Opinion as to Conditions...............................................58
Section 11.05. Statements Required in Certificate or Opinions.........................................58
Section 11.06. When Securities Disregarded............................................................59
Section 11.07. Rules by Trustee, Paying Agent and Registrar...........................................60
Section 11.08. Legal Holidays.........................................................................60
Section 11.09. Governing Law..........................................................................60
Section 11.10. No Recourse Against Others.............................................................60
Section 11.11. Successors.............................................................................60
Section 11.12. Separability Clause....................................................................60
Section 11.13. Reliance on Financial Data.............................................................60
Section 11.14. Multiple Originals.....................................................................61
Section 11.15. Table of Contents; Headings............................................................61
Annex 4.07 Agreements Regarding Related Party Transactions
Exhibit A Provisions Relating To Initial Securities And Exchange Securities
Appendix I to Exhibit A Form Of Initial Security
Exhibit B Form Of Certificate To Be Delivered In Connection With
Transfers To IAI
Exhibit C Form Of Certificate To Be Delivered In Connection With
Transfers Pursuant To Regulation S
iii
Exhibit D Form Of Indenture Supplement To Add Guarantors
Exhibit E Form Of Subsidiary Guarantee
iv
INDENTURE dated as of August 18, 2004, between
MARQUEE HOLDINGS INC.,
a Delaware corporation (the "COMPANY"), and HSBC BANK USA, NATIONAL ASSOCIATION
a national banking association, as Trustee (the "TRUSTEE").
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, each party agrees as follows for the benefit
of the other party and for the equal and ratable benefit of the Holders of (i)
the Company's 12% Senior Discount Notes due 2014, issued on the date hereof and,
if applicable, any guarantees thereof by certain of the Company's subsidiaries
(the "INITIAL SECURITIES"), (ii) if and when issued, an unlimited principal
amount at maturity of additional 12% Senior Discount Notes due 2014 that may be
offered from time to time in one or more series subsequent to the Issue Date as
provided for in this Indenture and, if applicable, any guarantees thereof by
certain of the Company's subsidiaries (the "ADDITIONAL SECURITIES") and (iii) if
and when issued, the Company's 12% Senior Discount Notes due 2014 and, if
applicable, any guarantees thereof by certain of the Company's subsidiaries,
that may be issued from time to time in exchange for Initial Securities or for
Additional Securities each in offers registered under the Securities Act as
provided in Registration Rights Agreements (as hereinafter defined) (the
"EXCHANGE SECURITIES") or if and when issued pursuant to a private exchange of
Initial Securities or Additional Securities (the "PRIVATE EXCHANGE SECURITIES",
and together with the Exchange Securities, the Initial Securities and Additional
Securities, the "SECURITIES"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"2011 NOTES" means the 9 1/2% Senior Subordinated Notes due 2011
issued by AMC Entertainment Inc.
"ACCRETED VALUE" means as of any date (the "SPECIFIED DATE"), the
amount provided below for each $1,000 principal amount at maturity of the
Securities:
(1) if the Specified Date occurs on one of the following dates (each,
a "SEMI-ANNUAL ACCRETION DATE"), the Accreted Value will equal the amount set
forth below for such Semi-Annual Accretion Date:
Semi-Annual Accrual Date Accreted Value
------------------------ --------------
Issue Date $ 558.94
February 15, 2005 $ 591.90
August 15, 2005 $ 627.41
February 15, 2006 $ 665.06
August 15, 2006 $ 704.96
February 15, 2007 $ 747.26
August 15, 2007 $ 792.09
February 15, 2008 $ 839.62
August 15, 2008 $ 890.00
February 15, 2009 $ 943.40
August 15, 2009 $ 1,000.00
(2) if the Specified Date occurs before the first Semi-Annual
Accretion Date, the Accreted Value will equal the sum of (A) the original issue
price of a Security and (B) an amount equal to the product of (x) the Accreted
Value for the first Semi-Annual Accretion Date less such original issue price
multiplied by (y) a fraction, the numerator of which is the number of days from
the Issue Date to the Specified Date, using a 360-day year of twelve 30-day
months, and the denominator of which is the number of days elapsed from the
Issue Date to the first Semi-Annual Accretion Date, using a 360-day year of
twelve 30-day months; and
(3) if the Specified Date occurs between two Semi-Annual Accretion
Dates, the Accreted Value will equal the sum of (A) the Accreted Value for the
Semi-Annual Accretion Date immediately preceding such Specified Date and (B) an
amount equal to the product of (x) the Accreted Value for the Semi-Annual
Accretion Date immediately following such Specified Date less the Accreted Value
for the Semi-Annual Accretion Date immediately preceding such Specified Date
multiplied by (y) a fraction, the numerator of which is the number of days from
the immediately preceding Semi-Annual Accretion Date to the Specified Date,
using a 360-day year of twelve 30-day months, and the denominator of which is
180; and
(4) if the Specified Date occurs after the last Semi-Annual Accretion
Date, the Accreted Value will equal $1,000.
Notwithstanding the foregoing, if the Specified Date is prior to the
last Semi-Annual Accretion Date, but on or after the date on which the Company
elects to commence to pay cash interest (the "CASH ELECTION DATE"), all
references in this document to Accreted Value or principal amount at maturity in
respect of any Security shall be to the aggregate principal amount at maturity
of such Security, which shall be equal to the Accreted Value of such Security as
of the Cash Election Date determined in accordance with clauses (1), (2) and (3)
above.
"ACQUIRED INDEBTEDNESS" of any particular Person means Indebtedness of
any other Person existing at the time such other Person merged with or into or
became a Subsidiary of such particular Person or assumed by such particular
Person in connection with the acquisition of assets from any other Person, and
not incurred by such other Person in connection with, or in contemplation of,
such other Person merging with or into such particular Person or becoming a
Subsidiary of such particular Person or such acquisition.
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"ADDITIONAL INTEREST" means the additional interest, if any, to be
paid on the Initial Securities or any Additional Securities pursuant to any
Registration Rights Agreement as described in Exhibit A.
"AFFILIATE" means, with respect to any specified Person: (i) any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person; or (ii) any other Person
that owns, directly or indirectly, ten percent or more of such Person's Capital
Stock or any officer or director of any such Person or other Person or with
respect to any natural Person, any person having a relationship with such Person
by blood, marriage or adoption not more remote than first cousin. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"APOLLO" means Apollo Management L.P., a Delaware limited partnership.
"APOLLO GROUP" means: (i) Apollo; (ii) the Apollo Holders; and (iii)
any Affiliate of Apollo (including the Apollo Holders).
"APOLLO HOLDERS" means (i) Apollo Investment Fund V, L.P. ("AIF V"),
Apollo Overseas Partners V, L.P., ("AOP V"), Apollo Netherlands Partners V (A),
L.P. ("Apollo Netherlands A"), Apollo Netherlands Partners V (B), L.P. ("Apollo
Netherlands B") and Apollo German Partners V GmbH & Co KG ("Apollo German
Partners") and any other partnership or entity affiliated with and managed by
Apollo or its Affiliates to which AIF V, AOP V, Apollo Netherlands A, Apollo
Netherlands B, or Apollo German Partners assigns any of their respective
interests in Marquee Inc.
"BANKRUPTCY LAWS" means the bankruptcy laws of the United States and
the law of any other jurisdiction relating to bankruptcy, insolvency, winding
up, liquidation, reorganization or relief of debtors.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or
any committee of such Board of Directors duly authorized to act under the
Indenture.
"BOARD RESOLUTION" means a copy of a resolution, certified by the
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 any day other than a Saturday or Sunday or other
day on which banks in
New York,
New York, or the city in which the Corporate
Trust Office is located are authorized or required to be closed or, if no
Security is outstanding, the city in which the principal corporate trust office
of the Trustee is located.
"CAPITAL LEASE OBLIGATION" of any Person means any obligations of such
Person and its Subsidiaries on a consolidated basis under any capital lease or
financing lease of a real or personal property which, in accordance with GAAP,
has been recorded as a capitalized lease obligation (together with Indebtedness
in the form of operating leases entered into by the
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Company or its Subsidiaries after May 21, 1998 and required to be reflected on a
consolidated balance sheet pursuant to EITF 97-10 or any subsequent
pronouncement having similar effect).
"CAPITAL STOCK" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of such Person's
capital stock, including preferred stock, any rights (other than debt securities
convertible into capital stock), warrants or options to acquire such capital
stock, whether now outstanding or issued after the date of this Indenture.
"CASH EQUIVALENTS" means: (i) United States dollars; (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality; (iii) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any United States domestic commercial
bank having capital and surplus in excess of $500 million and a Xxxxx Bank Watch
Rating of "B" or better; (iv) repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clauses (ii)
and (iii) above entered into with any financial institution meeting the
qualifications specified in clause (iii) above; (v) commercial paper having one
of the two highest rating categories obtainable from Moody's or S&P in each case
maturing within six months after the date of acquisition; (vi) readily
marketable direct obligations issued by any State of the United States of
America or any political subdivision thereof having one of the two highest
rating categories obtainable from Moody's or S&P; and (vii) investments in money
market funds which invest at least 95% of their assets in securities of the
types described in clauses (i) through (vi) of this definition.
"CHANGE OF CONTROL" means the occurrence of, after the date of this
Indenture, any of the following events: (a) any "person" or "group" as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act other than one or
more Permitted Holders is or becomes the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that such person or group shall
be deemed to have "beneficial ownership" of all shares that any such person or
group has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, by way of merger,
consolidation or other business combination or purchase of 50% or more of the
total voting power of the Voting Stock of the Company (for purposes of
calculating the total voting power of the Voting Stock held by a group solely in
the context of a merger, consolidation or other business combination with a
Person engaged in a line of business similar to that of the Company and its
Subsidiaries on the Issue Date, the voting power beneficially owned by the
Permitted Holders or by Permitted Co-Investors, to the extent such voting power
of the Voting Stock was acquired by such Permitted Co-Investors on or before
January 31, 2005 in transactions that satisfy the definition of Permitted
Co-Investor, shall be excluded in an amount equal to the lesser of the total
voting power of the Voting Stock beneficially owned by such Permitted
Co-Investors on (x) January 31, 2005 or (y) the date of such merger,
consolidation or other business combination); (b) the adoption of a plan
relating to the liquidation or dissolution of the Company; (c) the sale, lease,
transfer or other conveyance, in one or a series of related transactions, of all
or substantially all of the assets of the Company and its Subsidiaries, taken as
a whole, to any Person other than one or more Permitted Holders; or (d) a change
of control under the indentures relating to the Existing Notes (other than a
change of control under the indenture relating to the 2011 Notes resulting from
the Transactions).
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"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. To the extent necessary to comply
with the requirements of the provisions of Trust Indenture Act Sections 310
through 317 as they are applicable to the Company, the term "Company" shall
include any other obligor with respect to the Securities for the purposes of
complying with such provisions.
"CONSOLIDATED EBITDA" means, with respect to any Person for any
period, the Consolidated Net Income (Loss) of such Person for such period
increased (to the extent deducted in determining Consolidated Net Income (Loss))
by the sum of: (i) all income taxes of such Person and its Subsidiaries paid or
accrued in accordance with GAAP for such period (other than income taxes
attributable to extraordinary, unusual or nonrecurring gains or losses); (ii)
Consolidated Interest Expense of such Person and its Subsidiaries for such
period; (iii) depreciation expense of such Person and its Subsidiaries for such
period; (iv) amortization expense of such Person and its Subsidiaries for such
period including amortization of capitalized debt issuance costs; and (v) any
other non-cash charges of such Person and its Subsidiaries for such period
(including non-cash expenses recognized in accordance with Financial Accounting
Standard Number 106), all determined on a consolidated basis in accordance with
GAAP; PROVIDED, HOWEVER, that for purposes of this definition, all transactions
involving the acquisition of any Person or motion picture theatre by another
Person shall be accounted for on a "pooling of interests" basis and not as a
purchase; PROVIDED, FURTHER, that, solely with respect to calculations of the
Consolidated EBITDA Ratio: (i) Consolidated EBITDA shall include the effects of
incremental contributions the Company reasonably believes in good faith could
have been achieved during the relevant period as a result of a Theatre
Completion had such Theatre Completion occurred as of the beginning of the
relevant period; provided, however, that such incremental contributions were
identified and quantified in good faith in an Officers' Certificate delivered to
the Trustee at the time of any calculation of the Consolidated EBITDA Ratio;
(ii) Consolidated EBITDA shall be calculated on a pro forma basis after giving
effect to any motion picture theatre or screen that was permanently or
indefinitely closed for business at any time on or subsequent to the first day
of such period as if such theatre or screen was closed for the entire period;
and (iii) all preopening expense and theatre closure expense which reduced (or
increased) Consolidated Net Income (or Loss) during any applicable period shall
be added to Consolidated EBITDA.
"CONSOLIDATED EBITDA RATIO" of any Person means, for any period, the
ratio of Consolidated EBITDA to Consolidated Interest Expense for such period
(other than any non-cash Consolidated Interest Expense attributable to any
amortization or write-off of deferred financing costs); provided that, in making
such computation, (A) the Consolidated Interest Expense attributable to interest
on any Indebtedness computed on a pro forma basis and bearing a floating
interest rate shall be computed as if the rate in effect on the date of
computation had been the applicable rate for the entire period and (B) with
respect to any Indebtedness which bears, at the option of such Person, a fixed
or floating rate of interest, such Person shall apply, at its option, either the
fixed or floating rate.
"CONSOLIDATED INTEREST EXPENSE" of any Person means, without
duplication, for any period, as applied to any Person, (A) the sum of (a) the
aggregate of the interest expense on
5
Indebtedness of such Person and its consolidated Subsidiaries for such period,
on a consolidated basis, including, without limitation: (i) amortization of debt
discount; (ii) the net cost under Interest Rate Protection Agreements (including
amortization of discounts); (iii) the interest portion of any deferred payment
obligation; and (iv) accrued interest, plus (b) the interest component of the
Capital Lease Obligations paid, accrued and/or scheduled to be paid or accrued
by such Person and its consolidated Subsidiaries during such period, minus (B)
the cash interest income (exclusive of deferred financing fees) of such Person
and its consolidated subsidiaries during such period, in each case as determined
in accordance with GAAP consistently applied.
"CONSOLIDATED NET INCOME (LOSS)" of any Person means, for any period,
the consolidated net income (loss) of such Person and its consolidated
Subsidiaries for such period as determined in accordance with GAAP, adjusted, to
the extent included in calculating such net income (loss), by excluding all
extraordinary gains or losses (net of reasonable fees and expenses relating to
the transaction giving rise thereto) of such Person and its Subsidiaries.
"CONSTRUCTION INDEBTEDNESS" means Indebtedness incurred by the Company
or its Subsidiaries in connection with the construction of motion picture
theatres or screens.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Corporate Trust.
"CREDIT FACILITY" means that certain Amended and Restated Credit
Agreement dated as of April 10, 1997, as amended, among AMC Entertainment Inc.,
The Bank of Nova Scotia as administrative agent, Bank of America National Trust
and Savings Association, as document agent, and the various other financial
institutions parties thereto, as the same may be amended from time to time,
together with any extensions, revisions, increases, refinancings or replacements
thereof by a lender or syndicate of lenders.
"CURRENCY HEDGING OBLIGATIONS" means the obligations of any Person
pursuant to an arrangement designed to protect such Person against fluctuations
in currency exchange rates.
"DEBT RATING" means the rating assigned to the Securities by Moody's
or S&P, as the case may be.
"DEFAULT" means any event which is, or after notice or the passage of
time or both, would be, an Event of Default.
"DISCOUNT SECURITIES ESCROW AGREEMENT" means the Pledge and Escrow
Agreement, dated as of August 18, 2004, among the Company, the Trustee and the
Escrow Agent regarding the Initial Securities.
"DTC" means The Depository Trust Company, a
New York corporation, and
its successors.
"EQUITY OFFERING" means a public or private sale for cash by the
Company of its common stock or preferred stock (other than Redeemable Capital
Stock), or options, warrants or
6
rights with respect to its common stock or preferred stock (other than
Redeemable Capital Stock), other than public offerings with respect to the
Company's common stock or preferred stock (other than Redeemable Capital Stock),
or options, warrants or rights, registered on Form S-4 or S-8.
"ESCROW AGENT" means X.X. Xxxxxx Trust Company, National Association
as escrow agent and securities intermediary under the Discount Securities Escrow
Agreements.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXISTING NOTES" shall mean the 2011 Notes, the 9 7/8% Senior
Subordinated Notes due 2012 and the 8% Senior Subordinated Notes due 2014 issued
by AMC Entertainment Inc.
"FAIR MARKET VALUE" means, with respect to any asset or property, the
sale value that would be obtained in an arm's length transaction between an
informed and willing seller under no compulsion to sell and an informed and
willing buyer under no compulsion to buy.
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied.
"GOVERNMENT SECURITIES" means direct obligations (or certificates
representing an ownership interest in such obligations) of, or obligations
guaranteed by, the United States of America (including any agency or
instrumentality thereof) for the payment of which the full faith and credit of
the United States of America is pledged and which are not callable or redeemable
at the issuer's option.
"GUARANTEE" means, with respect to any Person, any obligation,
contingent or otherwise, of such Person directly or indirectly guaranteeing any
Indebtedness or other obligation of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person: (i) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or other obligation of such
other Person (whether arising by virtue of partnership arrangements, or by
agreements to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise); or
(ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness or other obligation of the payment thereof or to protect such
obligee against loss in respect thereof (in whole or in part); provided that the
term "Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"GUARANTEED INDEBTEDNESS" of any Person means, without duplication,
all Indebtedness of any other Person referred to in the definition of
Indebtedness and all dividends of other Persons for the payment of which, in
either case, such Person is directly or indirectly responsible or liable as
obligor, guarantor or otherwise.
"GUARANTOR" shall mean each Subsidiary of the Company that provides a
Subsidiary Guarantee in accordance with the Indenture; PROVIDED that upon the
release or discharge of such Subsidiary from its Subsidiary Guarantee in
accordance with the Indenture, such Subsidiary shall cease to be a Guarantor.
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"GUARANTOR SUBORDINATED OBLIGATION" means, with respect to a
Guarantor, any Indebtedness of such Guarantor (whether outstanding on the Issue
Date or thereafter Incurred) which is expressly subordinate in right of payment
to the obligations of such Guarantor under its Subsidiary Guarantee pursuant to
a written agreement.
"HEDGING OBLIGATION" of any Person means any Currency Hedging
Obligation entered into solely to protect the Company or any of its Subsidiaries
from fluctuations in currency exchange rates and not to speculate on such
fluctuations and any obligations of such Person pursuant to any Permitted
Interest Rate Protection Agreement.
"HOLDER" means the Person in whose name a Security is registered on
the Security register described in Section 2.04 as the registered holder of any
Security.
"INCUR" means, with respect to any Indebtedness or other obligation of
any Person, to create, issue, incur (by merger, conversion, exchange or
otherwise), extend, assume, Guarantee or become liable in respect of such
Indebtedness or other obligation or the recording, as required pursuant to GAAP
or otherwise, of any such Indebtedness or obligation on the balance sheet of
such Person (and "Incurrence" and "Incurred" shall have meanings correlative to
the foregoing); PROVIDED, HOWEVER, that a change in GAAP that results in an
obligation (including, without limitation, preferred stock, temporary equity,
mezzanine equity or similar classification) of such Person that exists at such
time, and is not theretofore classified as Indebtedness, becoming Indebtedness
shall not be deemed an Incurrence of such Indebtedness; provided further,
however, that any Indebtedness or other obligations of a Person existing at the
time such Person becomes a Subsidiary (whether by merger, consolidation,
acquisition or otherwise) shall be deemed to be Incurred by such Subsidiary at
the time it becomes a Subsidiary; and PROVIDED FURTHER, HOWEVER, that solely for
purposes of determining compliance with Section 4.05, amortization of debt
discount shall not be deemed to be the Incurrence of Indebtedness, provided that
in the case of Indebtedness sold at a discount, the amount of such Indebtedness
Incurred shall at all times be the aggregate principal amount at stated
maturity.
"INDEBTEDNESS" means, with respect to any Person, without duplication:
(i) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services, excluding any trade payables and other
accrued current liabilities Incurred in the ordinary course of business, but
including, without limitation, all obligations of such Person in connection with
any letters of credit and acceptances issued under letter of credit facilities,
acceptance facilities or other similar facilities, now or hereafter outstanding;
(ii) all obligations of such Person evidenced by bonds, notes, debentures or
other similar instruments; (iii) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even if the rights and remedies of the seller or lender
under such agreement in the event of default are limited to repossession or sale
of such property), but excluding trade accounts payable arising in the ordinary
course of business; (iv) every obligation of such Person issued or contracted
for as payment in consideration of the purchase by such Person or a Subsidiary
of such Person of the Capital Stock or substantially all of the assets of
another Person or in consideration for the merger or consolidation with respect
to which such Person or a Subsidiary of such Person was a party; (v) all
indebtedness referred to in clauses (i) through (iv) above of other Persons and
all dividends of other Persons, the payment of which is secured by (or for which
the holder of such indebtedness has an existing right,
8
contingent or otherwise, to be secured by) any Lien upon or in property
(including, without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such indebtedness; (vi) all Guaranteed Indebtedness of such Person; (vii) all
obligations under Interest Rate Protection Agreements of such Person; (viii) all
Currency Hedging Obligations of such Person; (ix) all Capital Lease Obligations
of such Person; and (x) any amendment, supplement, modification, deferral,
renewal, extension or refunding of any liability of the types referred to in
clauses (i) through (ix) above.
"INDENTURE" means this instrument as originally executed (including
all exhibits and schedules hereto) and as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof.
"INTEREST RATE PROTECTION AGREEMENT" means any interest rate
protection agreement, interest rate future agreement, interest rate option
agreement, interest rate swap agreement, interest rate cap agreement, interest
rate collar agreement, interest rate hedge agreement, option or future contract
or other similar agreement or arrangement designed to protect the Company or any
of its Subsidiaries against fluctuations in interest rates.
"ISSUE DATE" means August 18, 2004.
"X.X. XXXXXX PARTNERS GROUP" means (1) X.X. Xxxxxx Partners, LLC and
(ii) any Affiliates of X.X. Xxxxxx Partners, LLC.
"LIEN" means any mortgage, lien (statutory or other), pledge, security
interest, encumbrance, claim, hypothecation, assignment for security, deposit
arrangement or preference or other security agreement of any kind or nature
whatsoever. A Person shall be deemed to own subject to a Lien any property which
it has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to Indebtedness of such Person. The right of a distributor to the
return of its film held by a Person under a film licensing agreement is not a
Lien as used herein. Reservation of title under an operating lease by the lessor
and the interest of the lessee therein are not Liens as used herein.
"MARQUEE NOTES" means the 8 5/8% Senior Notes due 2012 and Senior
Floating Rate Notes due 2010 issued by Marquee Inc. on the Issue Date.
"MATURITY" means, with respect to any Security, the date on which the
principal of such Security becomes due and payable as provided in such Security
or this Indenture, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"MERGER" means the merger of Marquee Inc. with and into AMC
Entertainment Inc. pursuant to the
Merger Agreement.
"
MERGER AGREEMENT" means the Agreement and Plan of Merger by and among
the Company, Marquee Inc. and AMC Entertainment Inc. dated as of July 22, 2004.
"MOODY'S" means Xxxxx'x Investor Service, Inc. or any successor to the
rating agency business thereof.
9
"NET CASH PROCEEDS," with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, listing fees,
discounts or commissions and brokerage, consultant and other fees and charges
actually Incurred in connection with such issuance or sale and net of taxes paid
or payable as a result of such issuance or sale (after taking into account any
available tax credit or deductions and any tax sharing arrangements).
"NON-RECOURSE INDEBTEDNESS" means Indebtedness as to which: (i) none
of the Company or any of its Subsidiaries (a) provides credit support (including
any undertaking, agreement or instrument which would constitute Indebtedness) or
(b) is directly or indirectly liable; and (ii) no default with respect to such
Indebtedness (including any rights which the holders thereof may have to take
enforcement action against the relevant Unrestricted Subsidiary or its assets)
would permit (upon notice, lapse of time or both) any holder of any other
Indebtedness of the Company or its Subsidiaries (other than Non-Recourse
Indebtedness) to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity.
"OBLIGATIONS" means any principal (including reimbursement obligations
and guarantees), premium, if any, interest (including interest accruing on or
after the filing of, or which would have accrued but for the filing of, any
petition in bankruptcy or for reorganization relating to the Company whether or
not a claim for post-filing interest is allowed in such proceedings), penalties,
fees, expenses, indemnifications, reimbursements, claims for rescission,
damages, gross-up payments and other liabilities payable under the documentation
governing any Indebtedness or otherwise.
"OFFERING MEMORANDUM" means the Offering Memorandum dated August 6,
2004 relating to the Initial Securities.
"OFFICER" means the Chairman of the Board, any Co-Chairman of the
Board, President, the Chief Executive Officer, any Executive Vice President, any
Senior Vice President and the Chief Financial Officer of the Company.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers.
Each such certificate shall include the statements provided for in Trust
Indenture Act Section 314(e) to the extent applicable.
"OPINION OF COUNSEL" means a written opinion of counsel to the Company
or any other Person reasonably satisfactory to the Trustee.
"PAYMENT DEFAULT" means any default in payment (whether at stated
maturity, upon scheduled installment, by acceleration or otherwise) of principal
of, premium, if any, or interest in respect of any Senior Indebtedness beyond
any applicable grace periods.
"PERMITTED CO-INVESTOR" means any one or more institutional investors
and their respective Affiliates to which any Permitted Holder transfers in the
aggregate up to, but no more than, 35% of (a) its equity commitments to the
Transactions or (b) its equity securities of the Company or Marquee Inc., in
each case on or before January 31, 2005 (all transfers to any Affiliates of such
institutional investor shall be included in such percentage calculation).
10
"PERMITTED HOLDER" means: (i) any member of the Apollo Group; (ii) any
member of the X.X. Xxxxxx Partners Group; and (iii) any Subsidiary, any employee
stock purchase plan, stock option plan or other stock incentive plan or program,
retirement plan or automatic reinvestment plan or any substantially similar plan
of the Company or Marquee Inc. or any Subsidiary or any Person holding
securities of the Company or Marquee Inc. for or pursuant to the terms of any
such employee benefit plan; provided that if any lender or other Person shall
foreclose on or otherwise realize upon or exercise any remedy with respect to
any security interest in or Lien on any securities of the Company or Marquee
Inc. held by any Person listed in this clause (iii), then such securities shall
no longer be deemed to be held by a Permitted Holder
"PERMITTED INDEBTEDNESS" means the following:
(i) (a) Indebtedness of Marquee Inc. in respect of the Marquee
Notes and indebtedness of the guarantors of the Marquee Notes in respect of
their Guarantees of the Marquee Notes, in each case issued on the Issue
Date, and the related exchange notes and exchange guarantees issued in
registered exchange offers pursuant to the related registration rights
agreements, (b) Indebtedness in respect of the Guarantees by the guarantors
of the Existing Notes and (c) Indebtedness of the Company in respect of the
Initial Securities or upon an exchange of such Initial Securities for
Exchange Securities or Private Exchange Securities, or upon an exchange of
such Subsidiary Guarantees for exchange Subsidiary Guarantees issued in any
registered exchange offer;
(ii) Indebtedness of Marquee Inc. under the Credit Facility in an
aggregate principal amount at any one time outstanding not to exceed $425.0
million and the related Guarantees by the Company and the Subsidiaries that
Guarantee the Indebtedness Incurred pursuant to the Credit Facility;
(iii) Indebtedness of the Company or any of its Subsidiaries
outstanding on the Issue Date;
(iv) Indebtedness of the Company or any of its Subsidiaries
consisting of Permitted Interest Rate Protection Agreements;
(v) Indebtedness of the Company or any of its Subsidiaries to any
one or the other of them;
(vi) Indebtedness incurred to renew, extend, refinance or refund
(each, a "refinancing") the Existing Notes or any Indebtedness outstanding
on the Issue Date, including the Initial Securities, in an aggregate
principal amount not to exceed the principal amount of the Indebtedness so
refinanced plus the amount of any premium required to be paid in connection
with such refinancing pursuant to the terms of the Indebtedness 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 expenses of the Company
incurred in connection with such refinancing;
11
(vii) Indebtedness of any Subsidiary incurred in connection with the
Guarantee of any Indebtedness of Marquee Inc. or the Company as permitted
by this Indenture; PROVIDED that in the event such Indebtedness that is
being Guaranteed is a Subordinated Obligation of the Company or a Guarantor
Subordinated Obligation, then the related Guarantee shall be subordinated
in right of payment to the Subsidiary Guarantee;
(viii) Indebtedness relating to Currency Hedging Obligations entered
into solely to protect the Company or any of its Subsidiaries from
fluctuations in currency exchange rates and not to speculate on such
fluctuations;
(ix) Capital Lease Obligations of the Company or any of its
Subsidiaries;
(x) Indebtedness of the Company or any of its Subsidiaries in
connection with one or more standby letters of credit or performance bonds
issued in the ordinary course of business or pursuant to self-insurance
obligations;
(xi) Indebtedness represented by property, liability and workers'
compensation insurance (which may be in the form of letters of credit);
(xii) Acquired Indebtedness; PROVIDED that such Indebtedness, if
incurred by the Company, would be in compliance with Section 4.05;
(xiii) Indebtedness of the Company or any of its Subsidiaries to an
Unrestricted Subsidiary for money borrowed; PROVIDED that (a) such
Indebtedness is subordinated in right of payment to the Securities and (b)
the Weighted Average Life of such Indebtedness is greater than the Weighted
Average Life of the Securities;
(xiv) Construction Indebtedness in an aggregate principal amount
that does not exceed $100.0 million at any time outstanding; and
(xv) Indebtedness not otherwise permitted to be Incurred pursuant
to clauses (i) through (xiv) above which, together with any other
Indebtedness pursuant to this clause (xv), has an aggregate principal
amount that does not exceed $100.0 million at any time outstanding.
"PERMITTED INTEREST RATE PROTECTION AGREEMENTS" means, with respect to
any Person, Interest Rate Protection Agreements entered into the ordinary course
of business by such Person that are designed to protect such Person against
fluctuations in interest rates with respect to Permitted Indebtedness and that
have a notional amount no greater than the payment due with respect to Permitted
Indebtedness hedged thereby.
"PERMITTED LIENS" means, with respect to any Person:
(i) Liens on the property and assets of the Company and its
Subsidiaries securing Indebtedness and Guarantees permitted to be Incurred
under this Indenture (other than Subordinated Obligations and Guarantor
Subordinated Obligations) in an aggregate principal amount not to exceed
the sum of (x) $425.0 million and (y) 10% of Total Tangible Assets;
12
(ii) pledges or deposits by such Person under workmen's
compensation laws, unemployment insurance laws or similar legislation, or
good faith deposits in connection with bids, tenders, contracts (other than
for the payment of Indebtedness) or leases to which such Person is a party,
or deposits to secure public or statutory obligations of such Person or
deposits of cash or United States government bonds to secure surety or
appeal bonds to which such Person is a party, or deposits as security for
contested taxes or import or customs duties or for the payment of rent, in
each case Incurred in the ordinary course of business;
(iii) Liens imposed by law, including carriers', warehousemen's and
mechanics' Liens and other similar Liens, on the property of the Company or
any Subsidiary, in each case arising in the ordinary course of business and
securing payment of obligations that are not more than 60 days past due, or
are being contested in good faith by appropriate proceedings if a reserve
or other appropriate provisions, if any, as shall be required by GAAP shall
have been made in respect thereof;
(iv) Liens for taxes, assessments or other governmental charges not
yet subject to penalties for non-payment or which are being contested in
good faith by appropriate proceedings provided appropriate reserves
required pursuant to GAAP have been made in respect thereof;
(v) Liens in favor of issuers of surety or performance bonds or
letters of credit or bankers' acceptances issued pursuant to the request of
and for the account of such Person in the ordinary course of its business;
provided, however, that such letters of credit do not constitute
Indebtedness;
(vi) encumbrances, ground leases, easements or reservations of, or
rights of others for, licenses, rights of way, sewers, electric lines,
telegraph and telephone lines and other similar purposes, or zoning,
building codes or other restrictions (including, without limitation, minor
defects or irregularities in title and similar encumbrances) as to the use
of real properties or liens incidental to the conduct of the business of
such Person or to the ownership of its properties which do not in the
aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such
Person;
(vii) Liens securing Hedging Obligations so long as the related
Indebtedness is, and is permitted to be under the Indenture, secured by a
Lien on the same property securing such Hedging Obligation;
(viii) leases, licenses, subleases and sublicenses of assets
(including, without limitation, real property and intellectual property
rights) which do not materially interfere with the ordinary conduct of the
business of the Company or any of its Subsidiaries;
(ix) judgment Liens not giving rise to an Event of Default so long
as such Lien is adequately bonded and any appropriate legal proceedings
which may have been duly initiated for the review of such judgment have not
been finally terminated or the period within which such proceedings may be
initiated has not expired;
13
(x) Liens for the purpose of securing the payment of all or a part
of the purchase price of, or Capital Lease Obligations, purchase money
obligations or other payments Incurred to finance the acquisition,
improvement or construction of, assets or property acquired or constructed
in the ordinary course of business; PROVIDED that:
(a) the aggregate principal amount of Indebtedness secured
by such Liens is otherwise permitted to be Incurred under this
Indenture and does not exceed the cost of the assets or property so
acquired or constructed; and
(b) such Liens are created within 180 days of construction
or acquisition of such assets or property and do not encumber any
other assets or property of the Company or any Subsidiary other than
such assets or property and assets affixed or appurtenant thereto;
(xi) Liens arising solely by virtue of any statutory or common law
provisions relating to banker's Liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a
depositary institution;
(xii) Liens arising from Uniform Commercial Code financing statement
filings regarding operating leases entered into by the Company and its
Subsidiaries in the ordinary course of business;
(xiii) Liens existing on the Issue Date (excluding Liens relating to
obligations under the Credit Facility);
(xiv) Liens on property or shares of stock of a Person at the time
such Person becomes a Subsidiary; provided, however, that such Liens are
not created, Incurred or assumed in connection with, or in contemplation
of, such other Person becoming a Subsidiary; provided further, however,
that any such Lien may not extend to any other property owned by the
Company or any Subsidiary;
(xv) Liens on property at the time the Company or a Subsidiary
acquired the property, including any acquisition by means of a merger or
consolidation with or into the Company or any Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in connection
with, or in contemplation of, such acquisition; provided further, however,
that such Liens may not extend to any other property owned by the Company
or any Subsidiary;
(xvi) Liens securing Indebtedness or other obligations of a
Subsidiary owing to the Company or another Subsidiary;
(xvii) Liens securing the Securities and any Subsidiary Guarantees;
(xviii) Liens securing Indebtedness Incurred to refinance Indebtedness
that was previously so secured (other than Liens Incurred pursuant to
clauses (i), (xxi) or (xxii)), provided that any such Lien is limited to
all or part of the same property or assets (plus improvements, accessions,
proceeds or dividends or distributions in respect thereof) that
14
secured (or, under the written arrangements under which the original Lien
arose, could secure) the Indebtedness being refinanced;
(xix) any interest or title of a lessor under any Capital Lease
Obligation or operating lease;
(xx) Liens relating to the Discount Securities Escrow Agreements in
effect on the Issue Date and future escrow arrangements securing
Indebtedness Incurred in accordance with the Indenture;
(xxi) Liens securing Construction Indebtedness not to exceed $100.0
million; and
(xxii) Liens securing letters of credit in an amount not to exceed
$25.0 million in the aggregate at any one time.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
"PREFERRED STOCK" as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"REDEEMABLE CAPITAL STOCK" means any Capital Stock that, either by its
terms, by the terms of any security into which it is convertible or exchangeable
or otherwise, is or upon the happening of an event or passage of time would be
required to be redeemed prior to the final Stated Maturity of the Securities or
is mandatorily redeemable at the option of the holder thereof at any time prior
to such final Stated Maturity (except for any such Capital Stock that would be
required to be redeemed or is redeemable, at the option of the holder thereof if
the issuer thereof may redeem such Capital Stock for consideration consisting
solely of Capital Stock that is not Redeemable Capital Stock) or is convertible
into or exchangeable for debt securities at any time prior to such final Stated
Maturity at the option of the thereof.
"REFINANCING INDEBTEDNESS" means Indebtedness that is Incurred to
refund, refinance, replace, exchange, renew, repay or extend (including pursuant
to any defeasance or discharge mechanism) (collectively, "refinance,"
"refinances," and "refinanced" shall have a correlative meaning) any
Subordinated Obligation or Guarantor Subordinated Obligation (including
Indebtedness of the Company that refinances Indebtedness of any Subsidiary and
Indebtedness of any Subsidiary that refinances Indebtedness of another
Subsidiary) including Indebtedness that refinances Refinancing
Indebtedness;PROVIDED, HOWEVER, that:
(i) (a) if the Stated Maturity of the Indebtedness being
refinanced is earlier than the Stated Maturity of the Securities, the
Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being refinanced or (b) if the Stated Maturity
of the Indebtedness being refinanced is later than the Stated Maturity
15
of the Securities, the Refinancing Indebtedness has a Stated Maturity at
least 91 days later than the Stated Maturity of the Securities;
(ii) the Refinancing Indebtedness has a Weighted Average Life at
the time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Weighted Average Life of the Indebtedness being
refinanced;
(iii) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate
issue price) that is equal to or less than the sum of the aggregate
principal amount (or if issued with original issue discount, the aggregate
accreted value) then outstanding of the Indebtedness being refinanced
(plus, without duplication, any additional Indebtedness Incurred to pay
interest or premiums required by the instruments governing such existing
Indebtedness and fees Incurred in connection therewith); and
(iv) such Refinancing Indebtedness is subordinated in right of
payment to the Securities or any Subsidiary Guarantee of a Guarantor, as
the case may be, on terms at least as favorable to the holders of the
Securities as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"RESTRICTED PAYMENTS COMPUTATION PERIOD" means the period (taken as
one accounting period) from the date immediately succeeding the closing of the
Transactions to the last day of the Company's fiscal quarter preceding the date
of the applicable proposed Restricted Payment.
"S&P" means Standard & Poor's Ratings Service or any successor to the
rating agency business thereof.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITYHOLDER" means the Person in whose name a Security is
registered on the Security register described in Section 2.04 as the registered
holder of any Security.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission.
"STATED MATURITY," when used with respect to any Security or any
installment of interest thereof, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"SUBORDINATED OBLIGATION" means any Indebtedness of the Company
(whether outstanding on the Issue Date or thereafter Incurred) which is
subordinate or junior in right of payment to the Securities pursuant to a
written agreement.
16
"SUBSIDIARY" of any person means: (i) any corporation of which more
than 50% of the outstanding shares of Capital Stock having ordinary voting power
for the election of directors is owned directly or indirectly by such Person;
and (ii) any partnership, limited liability company, association, joint venture
or other entity in which such Person, directly or indirectly, has more than a
50% equity interest, and, except as otherwise indicated herein, references to
Subsidiaries shall refer to Subsidiaries of the Company. Notwithstanding the
foregoing, for purposes hereof, an Unrestricted Subsidiary shall not be deemed a
Subsidiary of the Company other than for purposes of the definition of
"Unrestricted Subsidiary" unless the Company shall have designated in writing to
the Trustee an Unrestricted Subsidiary as a Subsidiary. A designation of an
Unrestricted Subsidiary as a Subsidiary may not thereafter be rescinded.
"SUBSIDIARY GUARANTEE" shall mean, individually, any Guarantee of
payment of the Securities, and Exchange Securities pursuant to this Indenture by
a Guarantor and any supplemental indenture applicable thereto (including
pursuant to Exhibit D), and, collectively, all such Guarantees. Each such
Subsidiary Guarantee will be substantially in the form prescribed in this
Indenture.
"THEATRE COMPLETION" means any motion picture theatre or screen which
was first opened for business by the Company or a Subsidiary of the Company
during any applicable period.
"TOTAL TANGIBLE ASSETS" shall mean the total consolidated assets of
the Company and its Subsidiaries, as shown on the most recent balance sheet of
the Company, less goodwill, patents, trademarks and other intangible assets as
determined in accordance with GAAP.
"TRANSACTIONS" means the transactions set forth in the
Merger
Agreement and the transactions related thereto.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.77aaa-77bbbb) as
in effect on the Issue Date; PROVIDED, HOWEVER, that, in the event the TIA is
amended after such date, "Trust Indenture Act" means, to the extent required by
any such amendments, the Trust Indenture Act of 1939 as so amended.
"TRUST OFFICER" means any officer within the Corporate Trust
Administration department of the Trustee (or any successor group of the Trustee)
with direct responsibility for the administration of this Indenture 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.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument, until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"U.S. DOLLARS", "UNITED STATES DOLLARS"; "US$" and the symbol "$" each
mean currency of the United States of America.
"UNIFORM COMMERCIAL CODE" means the
New York Uniform Commercial Code
as in effect from time to time.
17
"UNRESTRICTED SUBSIDIARY" means a Subsidiary of the Company designated
in writing to the Trustee: (i) whose properties and assets, to the extent they
secure Indebtedness, secure only Non-Recourse Indebtedness; (ii) that has no
Indebtedness other than Non-Recourse Indebtedness; and (iii) that has no
Subsidiaries.
"VOTING STOCK" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"WEIGHTED AVERAGE LIFE" means, as of any date, with respect to any
debt security, the quotient obtained by dividing (i) the sum of the products of
the number of years from such date to the dates of each successive scheduled
principal payment (including any sinking fund payment requirements) of such debt
security multiplied by the amount of such principal payment, by (ii) the sum of
all such principal payments.
"WHOLLY-OWNED SUBSIDIARY" of any Person means a Subsidiary of such
Person, all of the Capital Stock (other than Directors' qualifying shares) or
other ownership interests 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.
18
SECTION 1.02. OTHER DEFINITIONS.
TERM DEFINED IN SECTION
"Bankruptcy Order".................................................................. 6.01
"Change of Control Offer"........................................................... 4.10
"Change of Control Payment Date".................................................... 4.10
"Change of Control Purchase Price".................................................. 4.10
"covenant defeasance option"........................................................ 8.01
"Custodian"......................................................................... 6.01
"Event of Default".................................................................. 6.01
"Exchange Security"................................................................. Exhibit A
"Global Security"................................................................... Exhibit A
"Initial Securities"................................................................ 2.01
"legal defeasance option"........................................................... 8.01
"Legal Holiday"..................................................................... 11.08
"OID"............................................................................... 2.01
"Paying Agent"...................................................................... 2.04
"Private Exchange Security"......................................................... Exhibit A
"Registered Exchange Offer"......................................................... Exhibit A
"Registrar"......................................................................... 2.04
"Registration Rights Agreement"..................................................... Exhibit A
"Restricted Payments"............................................................... 4.06
"Shelf Registration Statement"...................................................... Exhibit A
"Special Interest Payment Date" .................................................... 2.11
"Special Mandatory Redemption Event"................................................ 3.07
"Special Record Date" .............................................................. 2.11
"Special Redemption Date" .......................................................... 3.07
"Surviving Entity".................................................................. 5.01
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE. Prior to
the effectiveness of the registration statement to the Registered Exchange Offer
or the Shelf Registration Statement, this Indenture shall incorporate and be
governed by the provisions of the TIA. After the effectiveness of either the
registration statement relating to the Registered Exchange Offer or the Shelf
Registration statement, this Indenture shall be subject to the provisions of the
TIA that are required to be a part of this Indenture and shall, to the extent
applicable, be governed by such provisions. The following TIA terms have the
following meanings:
"Commission" means the SEC.
"Indenture securities" means the Securities.
"indenture Security Holder" means a Securityholder.
"indenture to be Qualified" means this Indenture.
"Indenture Trustee" or "institutional Trustee" means the Trustee.
19
"obligor" on the indenture securities means the Company and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04. RULES OF CONSTRUCTION. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) unsecured Indebtedness shall not be deemed to be subordinate or
junior to secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness; and
(7) the principal amount of any non-interest bearing or other discount
security at any date shall be the principal amount thereof that would be
shown on a balance sheet of the issuer dated such date prepared in
accordance with GAAP.
ARTICLE II
THE SECURITIES
SECTION 2.01. AMOUNT OF SECURITIES; ISSUABLE IN SERIES. As provided
for in Exhibit A hereto, the aggregate principal amount at maturity of the
Securities which may be authenticated and delivered under this Indenture is
unlimited. All Securities shall be substantially identical in all respects other
than issue prices, issuance dates and denominations. The Securities may be
issued in one or more series; PROVIDED, HOWEVER, that any Securities issued with
original issue discount ("OID") for Federal income tax purposes shall not be
issued as part of the same series as any Securities that are issued with a
different amount of OID or are not issued with OID.
Subject to Section 2.03, the Trustee shall authenticate Initial
Securities for original issue on the Issue Date in the aggregate principal
amount at maturity of $304,000,000. With respect to any Securities issued after
the Issue Date (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, Initial
Securities pursuant to Section 2.07, 2.09 or 3.06 or Exhibit A), there shall be
established in or pursuant to a resolution of the Board of Directors, and
subject to Section 2.03, set forth, or determined in the
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manner provided in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of such Securities:
(1) whether such Securities shall be issued as part of a new or
existing series of Securities and the title of such Securities (which shall
distinguish the Securities of the series from Securities of any other
series);
(2) the aggregate principal amount at maturity of such Securities that
may be authenticated and delivered under this Indenture (which shall be
calculated without reference to any Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, other
Securities of the same series pursuant to Section 2.07, 2.09 or 3.06 or
Exhibit A or any Securities which, pursuant to Section 2.03, are deemed
never to have been authenticated and delivered hereunder);
(3) the issue price and issuance date of such Securities, including
the date from which interest on such Securities shall accrue;
(4) if applicable, that such Securities shall be issuable in whole or
in part in the form of one or more Global Securities and, in such case, the
respective depositories for such Global Securities, the form of any legend
or legends that shall be borne by any such Global Security in addition to
or in lieu of that set forth in Exhibit A and any circumstances in addition
to or in lieu of those set forth in Section 2.3 of Exhibit A in which any
such Global Security may be exchanged in whole or in part for Securities
registered, and any transfer of such Global Security in whole or in part
may be registered, in the name or names of Persons other than the
depository for such Global Security or a nominee thereof; and
(5) if applicable, that such Securities shall not be issued in the
form of Initial Securities or Additional Securities, but shall be issued in
the form of Private Exchange Securities or Exchange Securities.
If any of the terms of any series are established by action taken
pursuant to a resolution of the Board of Directors, a copy of an appropriate
record of such action shall be certified by the Secretary or any Assistant
Secretary of the Company and delivered to the Trustee at or prior to the
delivery of the Officers' Certificate or the trust indenture supplemental hereto
setting forth the terms of the series.
SECTION 2.02. FORM AND DATING. Provisions relating to the Securities
are set forth in Exhibit A, which is hereby incorporated in and expressly made
part of this Indenture. The Securities of each series and the Trustee's
certificate of authentication shall be substantially in the form of Appendix 1
to Exhibit A which is hereby incorporated in and expressly made a part of this
Indenture. Without limiting the generality of the foregoing, Securities offered
and sold to Qualified Institutional Buyers in reliance on Rule 144A shall
include the form of assignment set forth in Appendix I to Exhibit A and
Securities offered and sold in offshore transactions in reliance on Regulation S
(other than Initial Securities offered on the Issue Date) shall include the form
of certificate set forth in Exhibit C. The Securities of each series may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to
21
which the Company is subject, if any, or usage, provided that any such notation,
legend or endorsement is in a form reasonably acceptable to the Company. Each
Security shall be dated the date of its authentication. The terms of the
Securities of each series set forth in Appendix I to Exhibit A are part of the
terms of this Indenture.
SECTION 2.03. EXECUTION AND AUTHENTICATION. Two Officers (or one
Officer and the Vice President and Secretary of the Company) shall sign the
Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication, together with a written order of the
Company in the form of an Officers' Certificate for the authentication and
delivery of such Securities, and the Trustee in accordance with such written
order of the Company shall authenticate and deliver such Securities.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Unless limited by the terms of
such appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Registrar, Paying Agent or agent for service of notices and
demands.
The Trustee shall not be required to authenticate such Securities if
the issue thereof will adversely affect the Trustee's own rights, duties,
indemnities or immunities under the Securities and this Indenture.
SECTION 2.04. REGISTRAR AND PAYING AGENT. The Company shall maintain
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "REGISTRAR") and an office or agency where
Securities may be presented for payment (the "PAYING AGENT"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent and
"Registrar" includes any co-registrar.
The Company shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this Indenture, which shall incorporate
the terms of the TIA. The agreement shall implement the provisions of this
Indenture that relate to such agent. The Company shall notify the Trustee of the
name and address of any such agent. If the Company fails to maintain a Registrar
or Paying Agent, the Trustee shall act as such and shall be
22
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any of its domestic Wholly-Owned Subsidiaries may act as Paying
Agent, Registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and Paying
Agent in connection with the Securities.
SECTION 2.05. PAYING AGENT TO HOLD MONEY IN TRUST. Prior to each due
date of the principal and interest on any Security, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal and interest so
becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Securityholders or the Trustee all money held by the Paying Agent for
the payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company or any Guarantor in making any such
payment. If the Company or a domestic Wholly-Owned Subsidiary acts as Paying
Agent, it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee and to account for any funds disbursed by
the Paying Agent. Upon complying with this Section, the Paying Agent (if other
than the Company or a domestic Wholly-Owned Subsidiary) shall have no further
liability for the money delivered to the Trustee.
SECTION 2.06. SECURITYHOLDER LISTS. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders and shall otherwise comply with
TIA 312(a). If the Trustee is not the Registrar, the Company on its own behalf
and on the behalf of each of the Guarantors shall furnish to the Trustee, in
writing at least five Business Days before each interest payment date and at
such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and addresses
of Securityholders and the Company and the Guarantors shall otherwise comply
with TIA 312(a).
SECTION 2.07. REPLACEMENT SECURITIES. If a mutilated security is
surrendered to the Registrar or if the Holder of a Security claims that such
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies
any other reasonable requirements of the Trustee. If required by the Trustee or
the Company, such Holder shall furnish an indemnity bond sufficient in the
judgment of the Company and the Trustee to protect the Company, the Trustee, the
Paying Agent, the Registrar and any co-registrar from any loss which any of them
may suffer if a Security is replaced. The Company and the Trustee may charge the
Holder for their expenses in replacing a Security.
Every replacement Security is an additional obligation of Company.
SECTION 2.08. OUTSTANDING SECURITIES. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding. A Security does not cease to be outstanding because
the Company or an Affiliate of the Company holds the Security.
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If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a protected purchaser.
If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal and interest payable on that date with respect to the Securities
(or portions thereof) to be redeemed or maturing, as the case may be, and the
Paying Agent is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture, then on and after that date
such Securities (or portions thereof) cease to be outstanding and interest on
them ceases to accrue.
SECTION 2.09. TEMPORARY SECURITIES. Until definitive Securities are
ready for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities and
deliver them in exchange for temporary Securities. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at any office
or agency maintained by the Company for that purpose and such exchange shall be
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 make available for delivery in exchange therefor, one or more
definitive Securities representing an equal principal amount at maturity of
Securities. Until so exchanged, the Holder of temporary Securities shall in all
respects be entitled to the same benefits under this Indenture as a Holder of
definitive Securities.
SECTION 2.10. CANCELLATION. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel
(subject to the record retention requirements of the Exchange Act) all
Securities surrendered for registration of transfer, exchange, payment or
cancellation and deliver cancelled Securities to the Company upon a written
direction of the Company. Except as expressly permitted herein, the Company may
not issue new Securities to replace Securities it has redeemed, paid or
delivered to the Trustee for cancellation.
If the Company or any Guarantor acquires any of the Securities, 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 pursuant to this Section 2.10. The
Company may not issue new Securities to replace Securities it has paid or
delivered to the Trustee for cancellation for any reason other than in
connection with a registration of transfer or exchange of such Securities.
At such time as all beneficial interests in a Global Security have
either been exchanged for definitive Securities, transferred, redeemed,
repurchased or canceled, such Global Security shall be returned by DTC to the
Trustee for cancellation or retained and canceled by the Trustee. At any time
prior to such cancellation, if any beneficial interest in a Global Security is
24
exchanged for definitive Securities, transferred in exchange for an interest in
another Global Security, redeemed, repurchased or canceled, the principal amount
at maturity of Securities represented by such Global Security shall be reduced
and an adjustment shall be made on the books and records of the Trustee (if it
is then the Securities Custodian for such Global Security) with respect to such
Global Security, by the Trustee or the Securities Custodian, to reflect such
reduction.
SECTION 2.11. DEFAULTED INTEREST. If the Company defaults in a payment
of interest on the Securities, the Company shall pay the defaulted interest
(plus interest on such defaulted interest at the rate borne by the Securities to
the extent lawful) in any lawful manner. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Security
and the date (not less than 30 days after such notice) of the proposed payment
(the "SPECIAL INTEREST PAYMENT DATE"), and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such defaulted interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the 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 record date (the "SPECIAL RECORD
DATE") for the payment of such defaulted interest, which date shall be not more
than 15 days and not less than 10 days prior to the Special Interest Payment
Date and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company 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 and Special Interest Payment Date therefor to be given in the manner
provided for in Section 11.02, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such defaulted interest and the
Special Record Date and Special Interest Payment Date therefor having been so
given, such defaulted interest shall be paid on the Special Interest Payment
Date 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.
The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, 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 2.12. CUSIP, COMMON CODE OR ISIN NUMBERS. The Company in
issuing the Securities may use "CUSIP", "Common Code" or "ISIN" numbers (if then
generally in use) and, if so, the Trustee shall use "CUSIP", "Common Code" or
"ISIN" numbers in notices of redemption as a convenience to Holders; provided,
however, that neither the Company nor the Trustee shall have any responsibility
for any defect in the "CUSIP", "Common Code" or "ISIN" number that appears on
any Security, check, advice of payment or redemption notice, and any
25
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of a redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company shall promptly notify
the Trustee in writing of any change in the CUSIP, Common Code or ISIN number.
SECTION 2.13. COMPUTATION OF INTEREST. Interest and accretion on the
Securities shall be computed on the basis of a 360-day year of twelve 30-day
months and actual days elapsed.
ARTICLE III
REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE. If the Company elects to redeem
Securities pursuant to paragraph 5 of the Securities or is required to redeem
the Securities pursuant to Section 3.07 hereof, it shall notify the Trustee in
writing of the redemption date, the principal amount at maturity of Securities
to be redeemed, the redemption price and that such redemption is being made
pursuant to paragraph 5 of the Securities or Section 3.07 hereof.
The Company shall give notice to the Trustee provided for in this
Section 3.01 at least 45 days but not more than 60 days before the redemption
date if the redemption is pursuant to paragraph 5 of the Securities or at least
two Business Days prior to the Special Redemption Date if the redemption is
pursuant to Section 3.07 hereof, unless in each case, the Trustee consents to a
shorter period. Such notice shall be accompanied by an Officers' Certificate and
an Opinion of Counsel from the Company to the effect that such redemption will
comply with the conditions herein.
SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED. If fewer than
all the Securities are to be redeemed, not more than 60 days prior to the
redemption date, the Trustee shall select the Securities to be redeemed pro rata
or by lot or by a method that complies with applicable legal and securities
exchange requirements, if any, and that the Trustee considers fair and
appropriate and in accordance with methods generally used at the time of
selection by fiduciaries in similar circumstances. The Trustee shall make the
selection from outstanding Securities not previously called for redemption. The
Trustee may select for redemption portions of the principal amount at maturity
of Securities that have denominations larger than $1,000 principal amount at
maturity. Securities and portions of them the Trustee selects shall be in
amounts of $1,000 principal amount at maturity or a whole multiple of $1,000
principal amount at maturity. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption. The Trustee shall notify the Company promptly of the Securities or
portions of Securities to be redeemed.
SECTION 3.03. NOTICE OF REDEMPTION. At least 30 days but not more than
60 days before a date for redemption of Securities, the Company shall mail a
notice of redemption by first-class mail to each Holder of Securities to be
redeemed.
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The notice shall identify the Securities (or portion thereof) to be
redeemed (including CUSIP numbers if any) and shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be redeemed,
or if a Security is to be redeemed in part only, the identification and
principal amounts at maturity of the particular Securities (or portion
thereof) to be redeemed;
(6) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment pursuant
to the terms of this Indenture, interest on Securities (or portion thereof)
called for redemption ceases to accrue on and after the redemption date;
and
(7) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
At the Company's written request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section at least 45 days before the redemption date, unless the Trustee consents
to a shorter period.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the related interest payment date that is on or prior to
the date of redemption). Failure to give notice or any defect in the notice to
any Holder shall not affect the validity of the notice to any other Holder.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE. Prior to 10:00 a.m.,
New
York City time, on the redemption date, the Company shall deposit with the
Paying Agent (or, if the Company or a domestic Wholly-Owned Subsidiary is the
Paying Agent, shall segregate and hold in trust) money sufficient to pay the
redemption price of and accrued interest (subject to the right of Holders of
record on the relevant record date to receive interest due on the related
interest payment date that is on or prior to the date of redemption) on all
Securities to be redeemed on that date other than Securities or portions of
Securities called for redemption that have been delivered by the Company to the
Trustee for cancellation.
27
SECTION 3.06. SECURITIES REDEEMED IN PART. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount at maturity to the unredeemed portion of the Security
surrendered.
SECTION 3.07. SPECIAL REDEMPTION. In the event that (i) the
Merger
Agreement is terminated or (ii) the Transactions are not closed on or before
January 31, 2005 (each a "Special Mandatory Redemption Event"), then the Company
will redeem the Securities, in whole but not in part, within two Business Days'
notice, at a redemption price in cash equal to 100% of the Accreted Value of the
Securities to, but excluding, the Special Redemption Date pursuant to the terms
of the Discount Securities Escrow Agreement. The "Special Redemption Date" means
the second Business Day after the first Special Mandatory Redemption Event. Any
redemption made pursuant to this Section 3.07 shall be made pursuant to the
procedures set forth in the Discount Securities Escrow Agreement.
ARTICLE IV
COVENANTS
SECTION 4.01. PAYMENT OF SECURITIES. The Company shall promptly pay
the Accreted Value or principal of and premium and interest on the Securities,
in immediately available funds, on the dates and in the manner provided in the
Securities and in this Indenture. Accreted Value or principal and premium and
interest shall be considered paid on the date due if on such date the Trustee or
the Paying Agent holds in accordance with this Indenture money sufficient to pay
all Accreted Value or principal and premium and interest then due and the
Trustee or the Paying Agent, as the case may be, is not prohibited from paying
such money to the Securityholders on that date pursuant to the terms of this
Indenture.
The Company shall pay interest on overdue principal amount at maturity
at the rate specified therefor in the Securities, and it shall pay interest on
overdue installments of interest at the rate borne by the Securities to the
extent lawful.
The Company and the Guarantors will pay any present or future stamp,
court or documentary taxes or any other excise or property taxes, charges or
similar levies that arise in any jurisdiction from the execution, delivery,
enforcement or registration of the Securities, the Subsidiary Guarantees, this
Indenture or any other document or instrument in relation thereof, or the
receipt of any payments with respect to the Securities or the Subsidiary
Guarantees, excluding such taxes, charges or similar levies imposed by any
jurisdiction outside of the United States, the jurisdiction of incorporation of
any successor of the Company or any Guarantor or any jurisdiction in which a
Paying Agent is located, other than those resulting from, or required to be paid
in connection with, the enforcement of the Securities, the Subsidiary Guarantees
or any other such document or instrument following the occurrence of any Event
of Default with respect to the Securities. The Company or any Guarantors will
indemnify the Holders for any such taxes paid by such Holders.
SECTION 4.02. CORPORATE EXISTENCE. Subject to Article Five, the
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect the
28
corporate existence and corporate power and authority of the Company and each
Subsidiary; PROVIDED, HOWEVER, that the Company shall not be required to
preserve any such corporate existence and corporate power and authority if the
Company shall determine that the preservation thereof is no longer desirable in
the conduct of the business of the Company and its Subsidiaries taken as a
whole.
SECTION 4.03. PAYMENT OF TAXES AND OTHER CLAIMS. The Company will pay
or discharge or cause to be paid or discharged, before the same shall become
delinquent,
(a) all material taxes, assessments and governmental charges
levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary and
(b) all material lawful claims for labor, materials and supplies,
which, if unpaid, might by law become a Lien upon the property of the
Company or any Subsidiary that could produce a material adverse effect on
the consolidated financial condition of the Company; 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 4.04. MAINTENANCE OF PROPERTIES. The Company will cause all
Properties owned by the Company or any Subsidiary or used or held for use in the
conduct of its business or the business of any Subsidiary to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the 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, except, in
every case, as and to the extent that the Company may be prevented by fire,
strikes, lockouts, acts of God, inability to obtain labor or materials,
governmental restrictions, enemy action, civil commotion or unavoidable casualty
or similar causes beyond the control of the Company; PROVIDED, HOWEVER, that
nothing in this Section shall prevent the Company from discontinuing the
maintenance of any such Properties if such discontinuance is, in the judgment of
the Company, desirable in the conduct of its business or the business of any
Subsidiary and not disadvantageous in any material respect to the Holders.
SECTION 4.05. LIMITATION ON CONSOLIDATED INDEBTEDNESS. The Company
will not, and will not permit any of its Subsidiaries to, Incur any Indebtedness
(excluding Permitted Indebtedness); PROVIDED, HOWEVER, (i) that the Company may
incur Indebtedness if, after giving effect to such event on a pro forma basis,
the Company's Consolidated EBITDA Ratio for the four (4) full fiscal quarters
immediately preceding such event, taken as one period calculated on the
assumption that such Indebtedness had been incurred on the first day of such
four-quarter period, is greater than or equal to 2.0:1 and (ii) Marquee Inc. and
its Subsidiaries may incur Indebtedness if, after giving effect to such event on
a pro forma basis, the Marquee Inc.'s Consolidated EBITDA Ratio for the four (4)
full fiscal quarters immediately preceding such event, taken as one period
calculated on the assumption that such Indebtedness had been incurred on the
first day of such four-quarter period, is greater than or equal to 2.0:1.
29
SECTION 4.06. LIMITATION ON RESTRICTED PAYMENTS. The Company shall
not, directly or indirectly:
(a) declare or pay any dividend on, or make any distribution in
respect of, any shares of the Company's or any Subsidiary's Capital Stock
(excluding dividends or distributions payable in shares of its Capital
Stock or in options, warrants or other rights to purchase such Capital
Stock, but including dividends or distributions payable in Redeemable
Capital Stock or in options, warrants or other rights to purchase
Redeemable Capital Stock (other than dividends on such Redeemable Capital
Stock payable in shares of such Redeemable Capital Stock)) held by any
Person other than the Company, Marquee Inc. or any of their Wholly-Owned
Subsidiaries;
(b) purchase, redeem or acquire or retire for value any Capital
Stock of the Company or any Affiliate thereof (other than Marquee Inc. or
any Wholly-Owned Subsidiary of the Company) or any options, warrants or
other rights to acquire such Capital Stock; or
(c) purchase, repurchase, redeem, defease or otherwise acquire or
retire for value, prior to scheduled maturity, scheduled repayment or
scheduled sinking fund payment, any Subordinated Obligations or Guarantor
Subordinated Obligations (other than the purchase, repurchase, redemption,
defeasance or other acquisition or retirement of Subordinated Obligations
or Guarantor Subordinated Obligations purchased in anticipation of
satisfying a sinking fund obligation, principal installment or final
maturity, in each case due within one year of the date of purchase,
repurchase, redemption, defeasance or other acquisition or retirement);
(such payments or any other actions described in (a) through (c) above are
collectively referred to as "RESTRICTED PAYMENTS") unless at the time of and
after giving effect to the proposed Restricted Payment (the amount of any such
Restricted Payment, if other than cash, as determined by the Board of Directors,
whose determination shall be conclusive and evidenced by a Board Resolution):
(A) no Default or Event of Default shall have occurred and be continuing; (B)
the Company shall have made the election to pay cash interest on the Securities
and shall have made at least one cash interest payment or the last Semi-Annual
Accretion Date shall have occurred, (C) the Company could incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness) under the provisions
of Section 4.05 and (D) the aggregate amount of all Restricted Payments declared
or made on or after the date of consummation of the Transactions does not exceed
the sum of:
(i) (x) Consolidated EBITDA for the Restricted Payments
Computation Period minus (y) 2.0 times Consolidated Interest Expense for
the Restricted Payments Computation Period;
(ii) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors, whose
determination shall be conclusive, except that for any property whose Fair
Market Value exceeds $10.0 million such Fair Market Value shall be
confirmed by an independent appraisal obtained by the Company), received
after the date of the consummation of the Transactions by the
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Company from the issuance or sale (other than to any of its Subsidiaries)
of shares of Capital Stock of the Company (other than Redeemable Capital
Stock) or warrants, options or rights to purchase such shares of Capital
Stock;
(iii) the aggregate net proceeds, including the Fair Market Value of
property other than cash (as determined by the Board of Directors, whose
determination shall be conclusive, except that for any property whose Fair
Market Value exceeds $10.0 million such Fair Market Value shall be
confirmed by an independent appraisal obtained by the Company), received
after the date of the consummation of the Transactions by the Company from
debt securities that have been converted into or exchanged for Capital
Stock of the Company (other than Redeemable Capital Stock) to the extent
such debt securities were originally sold for such net proceeds plus the
aggregate cash received by the Company at the time of such conversion; and
(iv) the specific dollar amount of funds (or 100% of any deficit)
that Marquee Inc. would be permitted under the indentures relating to the
Marquee Notes to dividend to the Company immediately after giving effect to
the Transactions (as calculated on and as of the date of consummation of
the Transactions).
Notwithstanding the foregoing limitation, the Company may:
(i) pay dividends on its Capital Stock within sixty days of the
declaration thereof if, on the declaration date, such dividends could have
been paid in compliance with the foregoing limitation;
(ii) acquire, redeem or retire Capital Stock in exchange for, or in
connection with a substantially concurrent issuance of, Capital Stock of
the Company (other than Redeemable Capital Stock);
(iii) make any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Subordinated Obligations of the Company or
Guarantor Subordinated Obligations of any Guarantor made by exchange for,
or out of the proceeds of the substantially concurrent sale of, Capital
Stock of the Company (other than Redeemable Capital Stock and other than
Capital Stock issued or sold to a Subsidiary or an employee stock ownership
plan or similar trust to the extent such sale to an employee stock
ownership plan or similar trust is financed by loans from or Guaranteed by
the Company or any Subsidiary unless such loans have been repaid with cash
on or prior to the date of determination); provided, however, that the net
proceeds from such sale of Capital Stock will be excluded from clause
(D)(ii) of the preceding paragraph;
(iv) make any purchase, repurchase, redemption, defeasance or other
acquisition or retirement of Subordinated Obligations of the Company or
Guarantor Subordinated Obligations of any Guarantor made by exchange for,
or out of the proceeds of the substantially concurrent sale of,
Subordinated Obligations of the Company or any purchase, repurchase,
redemption, defeasance or other acquisition or retirement of Guarantor
Subordinated Obligations made by exchange for or out of the proceeds of the
substantially concurrent sale of Guarantor Subordinated Obligations that,
in each case, is
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permitted to be Incurred pursuant to Section 4.05 and that in each case
constitutes Refinancing Indebtedness; or
(v) make any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of any Subordinated Obligation at a
purchase price not greater than 101% of the principal amount of such
Subordinated Obligation plus accrued and unpaid interest in the event of a
Change of Control in accordance with provisions similar to Section 4.10
hereof; provided that, prior to or simultaneously with such purchase,
repurchase, redemption, defeasance or other acquisition or retirement, the
Company has made the Change of Control Offer (as defined in Section 4.10)
as provided in such covenant with respect to the Securities and has
completed the repurchase or redemption of all Securities validly tendered
for payment in connection with such Change of Control Offer.
SECTION 4.07. LIMITATION ON TRANSACTIONS WITH AFFILIATES. (a) The
Company will not, and will not permit any of its Subsidiaries to, directly or
indirectly enter into or suffer to exist any transaction or series of related
transactions (including, without limitation, the sale, purchase, exchange or
lease of assets, property or services) with any Affiliate of the Company (other
than a Wholly-Owned Subsidiary of the Company) involving aggregate consideration
in excess of $5.0 million unless (A) such transaction or series of transactions
is on terms that are no less favorable to the Company or such Subsidiary, as the
case may be, than would be available at the time of such transaction or series
of transactions in a comparable transaction in an arm's-length dealing with an
unaffiliated third party, (B) such transaction or series of transactions is in
the best interests of the Company and (C) with respect to a transaction or
series of transactions involving aggregate payments equal to or greater than
$50.0 million, a majority of disinterested members of the Board of Directors
determines that such transaction or series of transactions complies with clauses
(A) and (B) above, as evidenced by a Board Resolution.
(b) Notwithstanding the foregoing limitation, the Company and its
Subsidiaries may enter into or suffer to exist the following:
(i) any transaction pursuant to any contract of the Company or AMC
Entertainment Inc. in existence on the Issue Date;
(ii) any Restricted Payment permitted to be made pursuant to the
provisions of Section 4.06;
(iii) any transaction or series of transactions between the Company
and one or more of its Subsidiaries or between two or more of its
Subsidiaries (provided that no more than 5% of the equity interest in any
such Subsidiary is owned, directly or indirectly (other than by direct or
indirect ownership of an equity interest in the Company), by any Affiliate
of the Company other than a Subsidiary);
(iv) the payment of compensation (including amounts paid pursuant
to employee benefit plans) for the personal services of officers, directors
and employees of the Company or any of its Subsidiaries; and
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(v) the existence of, or the performance by the Company or any of
its Subsidiaries of its obligations under the terms of, any agreements that
are described in the Offering Memorandum under the headings "Management"
and "Certain Relationships and Related Party Transactions" (copies of which
descriptions are included in Annex 4.07 to this Indenture) and any
amendments thereto; PROVIDED, however, that the existence of, or the
performance by the Company or any of its Subsidiaries of its obligations
under, any future amendment to such agreements shall only be permitted by
this clause (v) to the extent that the terms of any such amendment, taken
as a whole, are not more disadvantageous to the holders of the Securities
in any material respect than the terms of such agreements in effect on the
date of the consummation of the Transactions.
SECTION 4.08. FUTURE GUARANTORS. After the Issue Date, the Company
will cause each Subsidiary which guarantees obligations under any Indebtedness
of the Company or the Guarantors to execute and deliver to the Trustee a
supplemental indenture pursuant to which such Guarantor will unconditionally
Guarantee, on a joint and several basis, the full and prompt payment of the
principal or Accreted Value of, premium, if any, interest and Additional
Interest, if any, on the Securities on a senior basis and all other obligations
under this Indenture. Each Subsidiary Guarantee will be limited to an amount not
to exceed the maximum amount that can be guaranteed by that Subsidiary without
rendering the Subsidiary Guarantee, as it relates to such Subsidiary, voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally. Notwithstanding the
foregoing, if a Guarantor is released and discharged in full from its
obligations under its Guarantees of all other Indebtedness of the Company, then
the Subsidiary Guarantee of such Guarantor shall be automatically and
unconditionally released and discharged.
SECTION 4.09. LIMITATION ON LIENS. The Company will not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, Incur or
suffer to exist any Lien (other than Permitted Liens) upon any of its property
or assets (including Capital Stock of Subsidiaries of the Company), whether
owned on the Issue Date or acquired after that date, which Lien is securing any
Indebtedness of the Company or, in the case of a Subsidiary, any Guarantee of
Indebtedness of the Company, unless contemporaneously with the Incurrence of
such Liens effective provision is made to secure the Indebtedness due under this
Indenture and the Securities and any Subsidiary Guarantees by any Subsidiary of
the Securities as required by Section 4.08 of this Indenture, equally and
ratably with (or prior to in the case of Liens with respect to Subordinated
Obligations or Guarantor Subordinated Obligations, as the case may be) the
Indebtedness secured by such Lien for so long as such Indebtedness is so
secured.
SECTION 4.10. CHANGE OF CONTROL. Upon the occurrence of a Change of
Control, the Company will be required to make an offer (a "CHANGE OF CONTROL
OFFER") to purchase all outstanding Securities at a purchase price equal to 101%
(the "CHANGE OF CONTROL PURCHASE PRICE") of their Accreted Value plus accrued
and unpaid interest, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
relevant interest payment date).
Within 30 days following the date upon which the Change of Control
occurred, the Company must send, by first class mail, a notice to each Holder,
with a copy to the Trustee, which notice shall govern the terms of the Change of
Control Offer. Such notice will state,
33
among other things, the purchase date, which must be no earlier than 30 days nor
later than 60 days from the date such notice is mailed, other than as may be
required by law (the "CHANGE OF CONTROL PAYMENT DATE"). The Change of Control
Offer is required to remain open for at least 20 Business Days and until the
close of business on the Change Control Payment Date.
In the event that the Company makes a Change of Control Offer to
purchase the Securities pursuant to this Section 4.10, the Company will comply
with any applicable securities laws and regulations, including any applicable
requirements of Section 14(e) of, and Rule l4e-1 under, the Exchange Act.
SECTION 4.11. PROVISION OF FINANCIAL INFORMATION. Notwithstanding that
the Company may not be subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, the Company shall file with the SEC and provide the
Trustee and the Securityholders such annual reports and such information,
documents and other reports as are specified in Sections 13 and 15(d) of the
Exchange Act and applicable to a U.S. corporation subject to such Sections, such
information, documents and reports to be so filed and provided at the times
specified for the filing of such information, documents and reports under such
Sections; PROVIDED, HOWEVER, that the Company shall not be so obligated to file
such information, documents and reports with the SEC if the SEC does not permit
such filings but shall still be obligated to provide such information, documents
and reports to the Trustee and the Securityholders. Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from any information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 4.12. STATEMENT AS TO COMPLIANCE. The Company shall deliver to
the Trustee, within 90 days after the end of each fiscal year ending after the
date hereof (the fiscal year as of the date hereof is the 52/53 week period
ending on the Thursday nearest March 31), a brief certificate of its principal
executive officer, principal financial officer or principal accounting officer
stating whether, to such officer's knowledge, the Company is in compliance with
all covenants and conditions to be complied with by it under this Indenture in
accordance with TIA 314(a)(4); PROVIDED that the first such certificate shall be
delivered no later than June 29, 2005. For purposes of this Section 4.12, such
compliance shall be determined without regard to any period of grace or
requirement of notice under this Indenture.
When a Default has occurred and is continuing or if the Trustee, any
Holder or the trustee for or the holder of any other evidence of Indebtedness of
the Company or any Subsidiary gives any notice or takes any other action with
respect to a claimed Default, the Company shall deliver to the Trustee an
Officers' Certificate specifying such Default, notice or other action within 10
Business Days of its occurrence.
SECTION 4.13. WAIVER OF CERTAIN COVENANTS. The Company may omit in any
particular instance to comply with any covenant or condition set forth in
Sections 4.03 to 4.10 and Section 4.11(a), if before the time for such
compliance, the Holders of a majority in aggregate principal amount at maturity
of the Securities at the time outstanding shall, by written direction of such
Holders, waive such compliance in such instance with such covenant or
34
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such covenant or condition shall remain in full force and
effect.
SECTION 4.14. ACTIVITIES OF MARQUEE INC. Prior to the consummation of
the Merger, the Company will not, and will not permit Marquee Inc. to, engage in
any activity or enter into any transaction or agreement (including Incurring any
Indebtedness other than the Marquee Notes, making any Restricted Payments,
engaging in any transactions with Affiliates, incurring any Liens or entering
into any mergers (other than the Merger) or sales of substantially all of its
assets) except to the extent necessary to effectuate the Transactions
substantially in accordance with the description of the Transactions set forth
in the Offering Memorandum.
SECTION 4.15. FURTHER INSTRUMENTS AND ACTS. Upon request of the
Trustee, the Company shall execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.16. LIMITATION ON ABILITY OF COMPANY TO RELEASE FUNDS FROM
ESCROW. The Company agrees that (i) the terms of the Discount Securities Escrow
Agreement shall exclusively control the conditions under which and procedures
pursuant to which Collateral (as defined in the Discount Securities Escrow
Agreement) can be released and (ii) it will not attempt to have any Collateral
(as defined in the Discount Securities Escrow Agreement) released from escrow
except in accordance with the Discount Securities Escrow Agreement.
SECTION 4.17. PAYMENT FOR CONSENT. The Company shall not, and shall
not permit any Affiliate or Subsidiary of the Company to, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder for or as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this Indenture
or the Securities unless such consideration is offered to be paid to all Holders
that so consent, waive or agree to amend in the time frame set forth in
solicitation documents relating to such consent, waiver or agreement.
SECTION 4.18. DESIGNATION AS "DESIGNATED SENIOR DEBT". Substantially
concurrently with, but in any event, no later than one Business Day after the
Merger is consummated, the Securities shall be designated as "Designated Senior
Debt" as defined in and pursuant to the terms of the indentures relating to the
Existing Notes.
ARTICLE V
SUCCESSOR COMPANY
SECTION 5.01. CONSOLIDATION. The Company shall not, in a single
transaction or through a series of related transactions, consolidate with or
merge with or into any other Person (other than any Wholly-Owned Subsidiary) or
sell, assign, transfer, lease or otherwise dispose of all or substantially all
of its properties and assets to any Person (other than any Wholly-Owned
Subsidiary) or group of affiliated Persons unless at the time and after giving
effect thereto:
35
(a) either (A) the Company shall be the continuing corporation or
(B) the Person (if other than the Company) formed by such consolidation or
into which the Company is merged or the Person which acquires by
conveyance, transfer, lease or disposition the properties and assets of the
Company substantially as an entirety (the "SURVIVING ENTITY") shall be a
corporation duly organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia and
shall, in either case, expressly assume all the Obligations of the Company
under the Securities and the Indenture,
(b) immediately after giving effect to such transaction on a
pro forma basis, no Default or Event of Default shall have occurred and be
continuing,
(c) immediately after giving effect to such transaction on a
pro forma basis, except in the case of the consolidation or merger of any
Subsidiary with or into the Company, the Company (or the Surviving Entity
if the Company is not the continuing corporation) could incur $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.05 hereof (determined in either case on a consolidated basis),
and
(d) any Guarantor (unless it is the other party to the
transactions above, in which case clause (a)(B) shall apply) shall have by
supplemental indenture confirmed that its Subsidiary Guarantee shall apply to
such Person's obligations in respect of the Securities and the Indenture and, if
applicable, its obligations under any Registration Rights Agreement shall
continue to be in effect.
In connection with any consolidation, merger, transfer or lease
contemplated hereby, the Company shall deliver, or cause to be delivered, to the
Trustee, in the form and substance reasonably satisfactory to the Trustee, an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, transfer or lease and the supplemental indenture in
respect thereto comply with the provisions described herein and that all
conditions precedent herein provided for or relating to such transaction have
been complied with.
SECTION 5.02. SUCCESSOR SUBSTITUTED. Upon any consolidation or merger
or any transfer of all or substantially all of the assets of the Company in
accordance with Section 5.01, the successor corporation formed by such a
consolidation or into which the Company is merged or to which such transfer is
made shall succeed to, shall be substituted for and may exercise every right and
power of the Company under the Securities and this Indenture, with the same
effect as if such successor corporation had been named as the Company herein. In
the event of any transaction (other than a lease) described and listed in
Section 5.01 in which the Company is not the continuing corporation, the
successor Person formed or remaining shall succeed to, be substituted for and
may exercise every right and power of the Company, and the Company shall be
discharged from all obligations and covenants under the Securities and this
Indenture.
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ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any interest (including any
Additional Interest) on any Security when it becomes due and payable, and
continuance of such default for a period of 30 days;
(b) default in the payment of the Accreted Value, principal of or
premium, if any, on any Security at its Maturity (upon acceleration,
optional redemption, required purchase or otherwise);
(c) failure to comply with the requirements of Article Five;
(d) default in the performance, or breach, of any covenant or
warranty of the Company contained in this Indenture (other than a default
in the performance, or breach, of a covenant or warranty which is
specifically dealt with in clause (a), (b) or (c) above) and continuance of
such default or breach for a period of 60 days after written notice shall
have been given 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 Securities then outstanding;
(e) (A) one or more defaults in the payment of principal of or
premium, if any, on Indebtedness of the Company or any Significant
Subsidiary, aggregating $5.0 million or more, when the same becomes due and
payable at the stated maturity thereof, and such default or defaults shall
have continued after any applicable grace period and shall not have been
cured or waived or (B) Indebtedness of the Company or any Significant
Subsidiary, aggregating $5.0 million or more, shall have been accelerated
or otherwise declared due and payable, or required to be prepaid or
repurchased (other than by regularly scheduled prepayment) prior to the
stated maturity thereof;
(f) any holder of any Indebtedness in excess of $5.0 million in
the aggregate of the Company or any Significant Subsidiary shall notify the
Trustee of the intended sale or disposition of any assets of the Company or
any Significant Subsidiary that have been pledged to or for the benefit of
such Person to secure such Indebtedness or shall commence proceedings, or
take action (including by way of set-off) to retain in satisfaction of any
such Indebtedness, or to collect on, seize, dispose of or apply, any such
asset of the Company or any Significant Subsidiary pursuant to the terms of
any agreement or instrument evidencing any such Indebtedness of the Company
or any Significant Subsidiary or in accordance with applicable law;
37
(g) one or more final judgments or orders shall be rendered
against the Company or any Significant Subsidiary for the payment of money,
either individually or in an aggregate amount, in excess of $5.0 million
and shall not be discharged and either (A) an enforcement proceeding shall
have been commenced by any creditor upon such judgment or order or (B)
there shall have been a period of 60 consecutive days during which a stay
of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, was not in effect;
(h) the Company or any Significant Subsidiary pursuant to or under
or within the meaning of any Bankruptcy Law:
(1) commences a voluntary case or proceeding;
(2) consents to the entry of a Bankruptcy Order in an
involuntary case or proceeding or the commencement of any case against
it;
(3) consents to the appointment of a Custodian of it or for
any substantial part of its property;
(4) makes a general assignment for the benefit of its
creditors or files a proposal or other scheme of arrangement involving
the rescheduling or composition of its indebtedness;
(5) files a petition in bankruptcy or an answer or consent
seeking reorganization or relief; or
(6) consents to the filing of such petition in bankruptcy
or the appointment of or taking possession by a Custodian; or
(i) a court of competent jurisdiction in any involuntary case or
proceeding enters a Bankruptcy Order against the Company or any Significant
Subsidiary, and such Bankruptcy Order remains unstayed and in effect for 60
consecutive days; or
(j) a Custodian shall be appointed out of court with respect to
the Company or any Significant Subsidiary, or with respect to all or any
substantial part of the property of the Company or any Significant
Subsidiary; and
(k) during the period from the Issue Date to the closing of the
Transactions, any violation of the covenants in the indentures relating to
the Existing Notes.
"CUSTODIAN" means any receiver, interim receiver, receiver and
manager, trustee, assignee, liquidator, sequestrate or similar official under
any Bankruptcy Law or any other person with like powers. "BANKRUPTCY ORDER"
means any court order made in a proceeding pursuant to or within the meaning of
any Bankruptcy Law, containing an adjudication of bankruptcy or insolvency, or
providing for liquidation, winding up, dissolution or reorganization, or
appointing a Custodian of a debtor or of all or any substantial part of a
debtor's property, or providing for the staying, arrangement, adjustment or
composition of indebtedness or other relief of a debtor.
38
SECTION 6.02. ACCELERATION; RESCISSION AND ANNULMENT. If an Event of
Default (other than an Event of Default specified in Section 6.01(h), (i) or
(j)) occurs and is continuing, then and in every such case the Trustee, by
notice to the Company, or the Holders of not less than 25% in aggregate
principal amount at maturity of the Securities outstanding, by notice to the
Company and the Trustee, may declare the Accreted Value of, premium, if any, and
accrued and unpaid interest, if any, on all the Securities to be due and
payable. If an Event of Default specified in Section 6.01(h), (i) or (j) occurs
and is continuing, then the Accreted Value of, premium, if any, and accrued and
unpaid interest, if any, on all the Securities shall automatically become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder and if such Event of Default occurs prior to the
earlier of (i) the Cash Election Date and (ii) August 15, 2009, the Company will
thereafter be obligated to pay cash interest on each subsequent interest payment
date and the Securities will cease to accrete. The Company will deliver to the
Trustee, within 10 days after the occurrence thereof, notice of any default or
acceleration referred to in Sections 6.01(d) and 6.01(e).
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 in this Article provided, the Holders of a majority
in aggregate principal amount at maturity of the Securities outstanding, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:
(a) the Company has paid or deposited, or caused to be paid or
deposited, with the Trustee a sum sufficient to pay
(1) all overdue interest (including Additional Interest) on
all Securities,
(2) the Accreted Value of (and premium, if any, on) any
Securities that has become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Securities,
(3) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate borne by the Securities,
and
(4) 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
(b) all Events of Default, other than the non-payment of principal
of the Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 6.04.
No such rescission shall affect any subsequent default or impair any
right consequent thereon.
Notwithstanding the preceding paragraph, in the event of a declaration
of acceleration in respect of the Securities because an Event of Default
specified in Section 6.01(e) shall have occurred and be continuing, such
declaration of acceleration shall be automatically
39
annulled if the Indebtedness that is the subject of such Event of Default (1) is
Indebtedness in the form of an operating lease entered into by the Company or
its Subsidiaries after May 21, 1998 and required to be reflected on a
consolidated balance sheet pursuant to EITF 97-10, or any subsequent
pronouncement having similar effect, (2) has been discharged or the holders
thereof have rescinded their declaration of acceleration in respect of such
Indebtedness, and (3) 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 Indebtedness 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 6.03. OTHER REMEDIES. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04. WAIVER OF PAST DEFAULTS. Subject to Section 6.02, the
Holders of a majority in aggregate principal amount at maturity of the
Securities then outstanding by notice to the Trustee may waive an existing
Default and its consequences except (i) a Default in the payment of the
principal of or interest on a Security, (ii) a Default arising from a failure to
make or consummate a Change of Control Offer in accordance with the provisions
of Section 4.10, or (iii) a Default in respect of a provision that under Section
9.02 cannot be amended without the consent of each Securityholder affected. When
a Default is waived, it is deemed cured, but no such waiver shall extend to any
subsequent or other Default or impair any consequent right.
SECTION 6.05. CONTROL BY MAJORITY. The Holders of a majority in
aggregate principal amount at maturity of the Securities then outstanding may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the
Trustee with respect to the Securities. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture or, subject to
Section 7.01, that the Trustee determines is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal liability;
PROVIDED, HOWEVER, that subject to Section 315 of the TIA, the Trustee may take
any other action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to reasonable indemnification against all losses and expenses caused by taking
or not taking such action.
SECTION 6.06. LIMITATION ON SUITS. A Securityholder may not pursue any
remedy with respect to this Indenture or the Securities unless:
40
(1) such Holder shall have previously given to the Trustee written
notice of a continuing Event of Default;
(2) the Holders of at least 25% in aggregate principal amount at
maturity of the Securities then outstanding shall have made a written
request, and such Holder of or Holders shall have offered reasonable
indemnity, to the Trustee to pursue such proceeding as trustee; and
(3) the Trustee has failed to institute such proceeding and has
not received from the Holders of at least a majority in aggregate principal
amount at maturity of the Securities outstanding a direction inconsistent
with such request, within 60 days after such notice, request and offer.
The foregoing limitations on the pursuit of remedies by a
Securityholder shall not apply to a suit instituted by a Holder of Securities
for the enforcement of payment of the principal of or interest on such Security
on or after the applicable due date specified in such Security. A Securityholder
may not use this Indenture to prejudice the rights of another Securityholder or
to obtain a preference or priority over another Securityholder.
SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of, Accreted Value and interest on the securities held by
such Holder, on or after the respective due dates expressed in the Securities,
or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default
specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount then due and owing (together with interest on any
unpaid interest to the extent lawful) and the amounts provided for in Section
7.07.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in bankruptcy or other
Person performing similar functions, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder to make 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 to the Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and its counsel, and any other amounts due the Trustee under Section
7.07.
SECTION 6.10. PRIORITIES. If the Trustee collects any money or
property pursuant to this Article Six, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
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SECOND: to Securityholders for amounts due and unpaid on the
securities for principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for principal and interest respectively;
THIRD: to the Company; and,
FOURTH: the Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section. At least 15 days
before such record date, the Company shall mail to each Securityholder and
the Trustee a notice that states the record date, the payment date and
amount to be paid.
SECTION 6.11. UNDERTAKING FOR COSTS. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in aggregate principal amount at maturity of the Securities.
SECTION 6.12. WAIVER OF STAY OR EXTENSION LAWS. The Company (to the
extent it may lawfully do so) 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, that 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 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 VII
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee
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and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture (but
need not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(3) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to
the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers.
(h) 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 and to the provisions of the TIA and
the provisions of this Article Seven shall apply to the Trustee in its role as
Registrar, Paying Agent and Security Custodian.
(i) The Trustee shall not be deemed to have notice of a Default or
an Event of Default unless (a) the Trustee has received written notice thereof
from the Company or any Holder or (b) a Trust Officer shall have actual
knowledge thereof.
SECTION 7.02. RIGHTS OF TRUSTEE. Subject to 315(a)-(d) of the TIA:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document. The Trustee may,
however, in its discretion make such further inquiry or investigation into such
facts or matters as it may see fit and, if the Trustee shall
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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.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within its
rights or powers; PROVIDED, HOWEVER, that the Trustee's conduct does not
constitute willful misconduct or negligence.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect to any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The permissive rights of the Trustee to do things enumerated
in this Indenture shall not be construed as a duty unless so specified herein.
(g) The Trustee shall at no time have any responsibility or
liability for or with respect to the legality, validity or enforceability of any
Collateral (as defined in the Discount Securities Escrow Agreement) or any
arrangement or agreement between the Company and any Person with respect
thereto, or the perfection or priority of any security interest created in any
of the Collateral (as defined in the Discount Securities Escrow Agreement) or
the maintenance of any such perfection and priority, or for or with respect to
the sufficiency of the Collateral (as defined in the Discount Securities Escrow
Agreement) following an Event of Default.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliate with the same rights it
would have if it were not Trustee. Any Paying Agent, Registrar or co-registrar
may do the same with like rights. However, the Trustee must comply with Sections
7.10 and 7.11.
SECTION 7.04. TRUSTEE'S DISCLAIMER. The Trustee shall not be
responsible for and makes no representation as to the validity, priority or
adequacy of this Indenture or the Securities, it shall not be accountable for
the Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Company in this Indenture or in any
document issued in connection with the sale of the Securities or in the
Securities other than the Trustee's certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS. If a Default or Event of Default
occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to each Securityholder notice of the Default or Event of Default within 90
days after it is known to a Trust Officer or written notice of it is received by
the Trustee. Except in the case of a Default or Event of Default in
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payment of principal of or interest on any Security, the Trustee may withhold
the notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interests of Securityholders.
In addition, during the term of the Discount Securities Escrow Agreement, the
Trustee shall provide written notice to the Escrow Agent thereunder upon the
occurrence of (i) Default, (ii) Event of Default or (iii) the principal of,
premium, if any, and accrued but unpaid interest on the Securities having become
immediately due and payable pursuant to Section 6.02 and, in the case of clause
(iii), either (x) a court of competent jurisdiction by final and nonappealable
judgment having determined that such acceleration of the Securities was
appropriate as a result of a bona fide Event of Default hereunder or (y) such
acceleration not having been rescinded prior to January 30, 2005, in each case
of which the Trustee has actual knowledge
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS. As promptly as
practicable after each May 15 beginning with May 15, 2005, and in any event
prior to July 15 in each year thereafter, the Trustee shall mail to each
Securityholder a brief report dated as of May 15 each year that complies with
TIA 313(a), if and to the extent required by such subsection. The Trustee shall
also comply with TIA 313(b) and (c).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange (if any) on which the
Securities are listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange and of any delisting
thereof.
SECTION 7.07. COMPENSATION AND INDEMNITY. The Company shall pay to the
Trustee and any predecessor Trustee from time to time such compensation for its
services as shall from time to time be agreed to in writing by the Company and
the Trustee. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses incurred or made
by it, including costs of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company shall indemnify the Trustee against any and all loss,
liability or expense (including reasonable attorneys' fees) incurred by it in
connection with the acceptance and administration of this trust and the
performance of its duties hereunder. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Company shall not relieve the Company of its obligations
hereunder. The Company shall defend the claim and the Trustee may have separate
counsel and the Company shall pay the fees and expenses of such counsel. The
Company need not reimburse any expenses or indemnify against any loss, liability
or expense incurred by the Trustee through the Trustee's own willful misconduct,
negligence or bad faith. The Company need not pay for any settlement made by the
Trustee without the Company's consent, such consent not to be unreasonably
withheld. All indemnifications and releases from liability granted hereunder to
the Trustee shall extend to its officers, directors, employees, agents,
successors and assigns.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities.
45
The Company's payment obligations pursuant to this Section shall
survive the resignation or removal of the Trustee and the discharge of this
Indenture. When the Trustee incurs expenses after the occurrence of a Default
specified in Section 6.01(h), (i) or (j) with respect to the Company, the
expenses are intended to constitute expenses of administration under the
Bankruptcy Law.
The provisions of this Section shall survive the resignation or
removal of the Trustee and the termination of this Indenture.
SECTION 7.08. REPLACEMENT OF TRUSTEE. The Trustee may resign at any
time by so notifying the Company. The Holders of a majority in aggregate
principal amount at maturity of the Securities then outstanding may remove the
Trustee by so notifying the Trustee and may appoint a successor Trustee. The
Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders a
majority in aggregate principal amount at maturity of the Securities then
outstanding and such Holders do not reasonably promptly appoint a successor
Trustee, or if a vacancy exists in the office of Trustee for any reason (the
Trustee in such event being referred to herein as the retiring Trustee), the
Company shall promptly appoint a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.07.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in aggregate principal amount at maturity of the Securities then outstanding
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
who has been a bona fide Holder of a Security for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
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SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation or banking
association without any further act shall be the successor Trustee. In case at
the time such successor or successors by merger, conversion or consolidation to
the Trustee shall succeed to the trusts created by this Indenture any of the
Securities shall have been authenticated but not delivered, any such successor
to the Trustee may adopt the certificate of authentication of any predecessor
trustee, and deliver such Securities so authenticated; and in case at that time
any of the Securities shall not have been authenticated, any such successor to
the Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor to the Trustee; and in all
such cases such certificates shall have the full force which it is anywhere in
the Securities or in this Indenture provided that the certificate of the Trustee
shall have.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION. The Trustee shall at all
times satisfy the requirements of TIA 310(a). The Trustee shall have (or, in the
case of a corporation included in a bank holding company system, the related
bank holding company shall have) a combined capital and surplus of at least
$50,000,000 as set forth in its (or its related bank holding company's) most
recent published annual report of condition. The Trustee shall comply with TIA
310(b), subject to the penultimate paragraph thereof; PROVIDED, HOWEVER, that
there shall be excluded from the operation of TIA 310(b)(1) any indenture or
indentures under which other securities or certificates of interest or
participation in other securities of the Company are outstanding if the
requirements for such exclusion set forth in TIA 310(b)(1) are met.
For purposes of this Section 7.10 and clause (i) of the first proviso
contained in TIA Section 310(b), the Indenture, dated August 18, 2004, among
Marquee Inc. and HSBC Bank USA, National Association providing for the issuance
of the 8 5/8% Senior Notes due 2012, the Indenture, dated August 18, 2004, among
Marquee Inc. and HSBC Bank USA, National Association providing for the issuance
of the Senior Floating Rate Notes due 2010, the Indenture, dated as of January
27, 1999 as amended, among AMC Entertainment Inc. and HSBC Bank USA, National
Association as successor to The Bank of
New York, providing for the issuance of
the 9 1/2% Senior Subordinated Notes due 2011, the Indenture, dated as of
January 16, 2002, as amended, among AMC Entertainment Inc. and HSBC Bank USA,
National Association as successor to The Bank of
New York, providing for the
issuance of the 9 7/8% Senior Subordinated Notes due 2012 and the Indenture,
dated as of February 24, 2004, among AMC Entertainment Inc. and HSBC Bank USA,
National Association providing for the issuance of the 8% Senior Subordinated
Notes due 2014, are hereby deemed to be specifically described.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The
Trustee shall comply with TIA 311(a), excluding any creditor relationship listed
in TIA 311(b). A Trustee who has resigned or been removed shall be subject to
TIA 311(a) to the extent indicated.
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ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES; DEFEASANCE. (a)
When (i) either (1) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.07) for
cancellation or (2) all outstanding Securities have become due and payable,
whether at maturity or upon redemption or will become due and payable within one
year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption pursuant to
Article Three and the Company irrevocably deposits or caused to be deposited
with the Trustee funds in trust solely for the benefit of the Holders money in
U.S. dollars, Government Securities, or a combination thereof, in such amounts
as will be sufficient without consideration of any reinvestment of interest to
pay and discharge the entire Indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation for principal, premium, if any, and
interest (including Additional Interest, if any) to the date of maturity or
redemption (other than Securities replaced pursuant to Section 2.07); (ii) no
Default or Event of Default shall have occurred and be continuing on the date of
such deposit or shall occur as a result of such deposit and such deposit will
not result in a breach or violation of, or constitute a default under, any other
instrument to which the Company or any Guarantor is a party or by which the
Company or any Guarantor is bound; (iii) the Company or any Guarantor has paid
or caused to be paid all sums payable under this Indenture and the Securities;
and (iv) the Company has delivered irrevocable instructions to the Trustee under
this Indenture to apply the deposited money toward the payment of such
Securities at maturity or the redemption date, as the case may be, then upon
demand of the Company (accompanied by an Officers' Certificate and an Opinion of
Counsel stating that all conditions precedent specified herein relating to the
satisfaction and discharge of this Indenture have been complied with) this
Indenture shall cease to be of further effect with respect to the Securities and
the Trustee shall acknowledge satisfaction and discharge of this Indenture, at
the cost and expense of the Company.
(b) Subject to Sections 8.01(c) and 8.02, the Company at any time
may terminate (i) all of its obligations under the Securities and this Indenture
("LEGAL DEFEASANCE OPTION") or (ii) its obligations under Section 5.01(c) and
Sections 4.05, 4.06, 4.07, 4.08, 4.09, 4.10 and 4.11(a), and the operation of
Sections 6.01(c) (with respect to a Event of Default due to a failure to meet
obligations under Section 5.01(c)), (d), (e), (f) and (g) ("COVENANT DEFEASANCE
OPTION"). The Company may exercise its legal defeasance option notwithstanding
its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Sections 6.01(d) (with
respect to the covenants of Article Four identified in the immediately preceding
paragraph and the provisions of 5.01(c)), 6.01(e), (f) or (g).
Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
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(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 4.01, 4.02,
4.03, 4.12, 7.07, 7.08, 8.03, 8.04, 8.05 and 8.06 shall survive until the
Securities have been paid in full. Thereafter, the Company's obligations in
Sections 7.07, 8.04, 8.05 and 8.06 shall survive.
SECTION 8.02. CONDITIONS TO DEFEASANCE. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 who shall agree to comply with the provisions of this
Article Eight 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)
cash in U.S. Dollars 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, cash in U.S. Dollars 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 of (and premium, if any) and interest (including any
Additional Interest) on the outstanding Securities on the Stated Maturity
(or redemption date, if applicable) of such principal (and premium, if any)
or installment of interest; PROVIDED that the Trustee shall have been
irrevocably instructed 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 the Trustee, in accordance with
Section 3.01 hereof, a notice of its election to redeem all of the
outstanding Securities at a future date in accordance with Article Three
which notice shall be irrevocable.
(b) No Default or Event of Default shall have occurred and be
continuing on the date of such deposit or, insofar as Section 6.01(h), (i)
or (j) is 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);
(c) the deposit does not constitute a default hereunder or under
any other material agreement binding on the Company;
(d) the Company delivers to the Trustee an Opinion of Counsel to
the effect that the trust resulting from the deposit does not constitute,
or is qualified as, a regulated investment company under the Investment
Company Act of 1940;
(e) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (i) the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling, or (ii) since the date of this Indenture there
has been a change in the applicable Federal income tax law, in either case
to the effect that, and based thereon such Opinion of Counsel shall
49
confirm that, the Securityholders 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;
(f) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Securityholders 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
(g) the Company delivers to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent to
the defeasance and discharge of the Securities as contemplated by this
Article Eight have been complied with.
SECTION 8.03. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or Government Securities
deposited with it pursuant to this Article Eight. It shall apply the deposited
money and the money from Government Securities through the Paying Agent and in
accordance with this Indenture to the payment of principal of and interest on
the Securities.
SECTION 8.04. REPAYMENT TO COMPANY. The Trustee and the Paying Agent
shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon request any money held by them for
the payment of principal, premium or interest that remains unclaimed for two
years, and, thereafter, Securityholders entitled to the money must look to the
Company for payment as general creditors.
SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge imposed
on or assessed against deposited Government Securities or the principal and
interest received on such Government Securities.
SECTION 8.06. REINSTATEMENT. If the Trustee or Paying Agent is unable
to apply any money or Government Securities in accordance with this Article
Eight by reason of any legal proceeding or by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the Company's obligations under this Indenture and
the Securities shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Eight until such time as the Trustee or Paying Agent is
permitted to apply all such money or Government Securities in accordance with
this Article Eight; PROVIDED, HOWEVER, that, if the Company has made any payment
of interest on or principal of any Securities because of the reinstatement of
its obligations, the Company shall be
50
subrogated to the rights of the Holders of such Securities to receive such
payment from the money or Government Securities held by the Trustee or Paying
Agent.
ARTICLE IX
AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company and the Trustee
may amend this Indenture or the Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article Five;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; PROVIDED, HOWEVER, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees with respect to the Securities or to secure
the Securities;
(5) 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;
(6) to comply with any requirements of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the
TIA; or
(7) to make any change that does not adversely affect the rights
of any Securityholder.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 9.02. WITH CONSENT OF HOLDERS. The Company and the Trustee may
amend this Indenture or the Securities without notice to any Securityholder but
with the written consent of the Holders of at least a majority in aggregate
principal amount at maturity of the Securities then outstanding (including
consents obtained in connection with a tender offer or exchange offer for the
Securities). However, without the consent of each Securityholder affected
thereby, an amendment may not:
(a) change the Stated Maturity of the principal of, or Accreted
Value of, or any installment of interest (including Additional Interest)
on, any Security, or reduce the principal amount at maturity or Accreted
Value thereof or the rate of interest (including Additional Interest, if
any) thereon or any premium payable upon the redemption thereof, or change
the coin or currency in which the principal of any Security or any premium
or the interest (including Additional Interest) thereon is payable, or
impair the right to
51
institute suit for the enforcement of any such payment after the Stated
Maturity thereof (or, in the case of redemption, on or after the redemption
date); or
(b) reduce the amount of, or change the coin or currency of, or
impair the right to institute suit for the enforcement of, the Change of
Control Purchase Price; or
(c) reduce the percentage in 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
(d) modify any of the provisions of this Section or Sections 6.04,
6.07 and 4.13, 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 Security affected thereby.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment to
this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. A consent
to an amendment or a waiver by a Holder of a Security shall bind the Holder and
every subsequent Holder of that Security or portion of the Security that
evidences the same debt as the consenting Holder's Security, even if notation of
the consent or waiver is not made on the Security. However, any such Holder or
subsequent Holder may revoke the consent or waiver as to such Holder's Security
or portion of the Security if the Trustee receives the notice of revocation
before the date the amendment or waiver becomes effective. After an amendment or
waiver becomes effective, it shall bind every Securityholder. An amendment or
waiver becomes effective upon the execution of such amendment or waiver by the
Trustee.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. Such record date shall be a date not more than 30
days prior to the first solicitation of holders generally in connection
therewith and no later than the date such solicitation is completed. If a record
date is fixed, then notwithstanding the immediately preceding paragraph or
Section 316(c) of the TIA, those Persons who were Securityholders at such record
date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such
52
record date. No such consent shall be valid or effective for more than 180
days after such record date.
For all purposes of this Indenture, all Initial Securities, Additional
Securities of the same series, Exchange Securities for the same series of
Securities and Private Exchange Securities for the same series of Securities
shall vote together as one series of Securities under this Indenture.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver such Security to the Trustee. The Trustee may place an
appropriate notation on the Security regarding the changed terms and return such
Security to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Security shall issue and the Trustee
shall authenticate a new Security that reflects the changed terms. Failure to
make the appropriate notation or to issue a new Security shall not affect the
validity of such amendment.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS. The Trustee shall sign any
amendment authorized pursuant to this Article Nine if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, in addition to the documents required by Section 11.04 and (subject
to Section 7.01) shall be fully protected in relying upon, an Officers'
Certificate and an Opinion of Counsel stating that such amendment is authorized
or permitted by this Indenture.
ARTICLE X
GUARANTEE
SECTION 10.01. SUBSIDIARY GUARANTEE. Subject to the provisions of this
Article Ten, each Guarantor hereby fully, unconditionally and irrevocably
guarantees, as primary obligor and not merely as surety, jointly and severally
with each other Guarantor, to each Holder of the Securities and the Trustee, the
full and punctual payment when due, whether at maturity, by acceleration, by
redemption or otherwise, of the Accreted Value, principal of, premium, if any,
and interest, including Additional Interest, if any, on the Securities and all
other obligations and liabilities of the Company under this Indenture (including
without limitation interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Company or any Guarantor whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding and the
obligations under Section 7.07) (all the foregoing being hereinafter
collectively called the "GUARANTOR OBLIGATIONS"). Each Guarantor agrees that the
Guarantor Obligations will rank equally in right of payment with other
Indebtedness of such Guarantor, except to the extent such other Indebtedness is
subordinate to the Guarantor Obligations. Each Guarantor further agrees (to the
extent permitted by law) that the Guarantor Obligations may be extended or
renewed, in whole or in part, without notice or further assent from it, and that
it will remain bound under this Article Ten notwithstanding any extension or
renewal of any Guarantor Obligation.
53
Each Guarantor waives presentation to, demand of payment from and
protest to the Company of any of the Guarantor Obligations and also waives
notice of protest for nonpayment. Each Guarantor waives notice of any default
under the Securities or the Guarantor Obligations.
Each Guarantor further agrees that its Subsidiary Guarantee herein
constitutes a Guarantee of payment when due (and not a Guarantee of collection)
and waives any right to require that any resort be had by any Holder to any
security held for payment of the Guarantor Obligations.
Except as set forth in Section 10.02, the obligations of each
Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (other than payment of the Guarantor
Obligations in full), including any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to any defense of setoff,
counterclaim, recoupment or termination whatsoever or by reason of the
invalidity, illegality or unenforceability of the Guarantor Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Guarantor herein shall not be discharged or impaired or otherwise affected
by (a) the failure of any Holder to assert any claim or demand or to enforce any
right or remedy against the Company or any other person under this Indenture,
the Securities or any other agreement or otherwise; (b) any extension or renewal
granted; (c) any rescission, waiver, amendment or modification of any of the
terms or provisions of this Indenture, the Securities or any other agreement;
(d) the release of any security held by any Holder or the Trustee for the
Guarantor Obligations or any of them; (e) the failure of any Holder to exercise
any right or remedy against any other Guarantor; (f) any change in the ownership
of the Company; (g) any default, failure or delay, willful or otherwise, in the
performance of the Guarantor Obligations; or (h) any other act or thing or
omission or delay to do any other act or thing which may or might in any manner
or to any extent vary the risk of any Guarantor or would otherwise operate as a
discharge of such Guarantor as a matter of law or equity.
Subject to the provisions of Section 4.08, each Guarantor agrees that
its Subsidiary Guarantee herein shall remain in full force and effect until
payment in full of all the Guarantor Obligations or such Guarantor is released
from its Subsidiary in compliance with Section 10.03 hereof. Each Guarantor
further agrees that its Subsidiary Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any of the Guarantor Obligations is
rescinded or must otherwise be restored by any Holder upon the bankruptcy or
reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other
right which any Holder has at law or in equity against any Guarantor by virtue
hereof, upon the failure of the Company to pay any of the Guarantor Obligations
when and as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, each Guarantor hereby promises to and will, upon
receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in
cash, to the Holders an amount equal to the sum of (i) the unpaid amount of such
Guarantor Obligations then due and owing and (ii) accrued and unpaid interest on
such Guarantor Obligations then due and owing (but only to the extent not
prohibited by law).
54
Each Guarantor further agrees that, as between such Guarantor, on the
one hand, and the Holders, on the other hand, (x) the maturity of the Guarantor
Obligations guaranteed hereby may be accelerated as provided in this Indenture
for the purposes of its Subsidiary Guarantee herein, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Guarantor Obligations guaranteed hereby and (y) in the event of any such
declaration of acceleration of such Guarantor Obligations, such Guarantor
Obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantor for the purposes of this Subsidiary Guarantee.
Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees and expenses) incurred by the Trustee or
the Holders in enforcing any rights under this Section.
SECTION 10.02. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE FOR
FUTURE GUARANTORS.
To further evidence its Subsidiary Guarantee, each Subsidiary and
other Person that is required to become a Guarantor hereby agrees to execute a
supplement to this Indenture, substantially in the form of Exhibit D hereto, or
a Subsidiary Guarantee, substantially in the form of Exhibit E hereto, and
deliver it to the Trustee. Such Subsidiary Guarantee or supplement to this
Indenture shall be executed on behalf of each Guarantor by either manual or
facsimile signature of one Officer or other person duly authorized by all
necessary corporate action of each Guarantor who shall have been duly authorized
to so execute by all requisite corporate action. The validity and enforceability
of any Subsidiary Guarantee shall not be affected by the fact that it is not
affixed to any particular Security.
Each of the Guarantors hereby agrees that its Subsidiary Guarantee
shall remain in full force and effect notwithstanding any failure to endorse on
each Security a notation of such Subsidiary Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Security on which such Subsidiary Guarantee is endorsed or at
any time thereafter, such Guarantor's Subsidiary Guarantee of such Security
shall nevertheless be valid.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Subsidiary Guarantee set
forth in this Indenture on behalf of each Guarantor.
SECTION 10.03. LIMITATION ON LIABILITY; TERMINATION, RELEASE AND
DISCHARGE.
(a) Any term or provision of this Indenture to the contrary
notwithstanding, the obligations of each Guarantor hereunder will be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Guarantor (including, without limitation, any
Guarantees under the Credit Facility) and after giving effect to any collections
from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Subsidiary Guarantee or pursuant
to its contribution obligations
55
under this Indenture, result in the obligations of such Guarantor under its
Subsidiary Guarantee not constituting a fraudulent conveyance or fraudulent
transfer under federal or state law and not otherwise being void or voidable
under any similar laws affecting the rights of creditors generally.
(b) In addition, the Company shall not permit any Guarantor to
consolidate with or merge with or into any person (other than another Guarantor)
and shall not permit the conveyance, transfer or lease of substantially all of
the assets of any Guarantor UNLESS:
(1) the resulting, surviving or transferee Person shall be a
corporation, partnership, trust or limited liability company
organized and existing under the laws of the United States of
America, any State of the United States or the District of
Columbia and such Person (if not such Guarantor) shall
expressly assume, by supplemental indenture, executed and
delivered to the Trustee, all the obligations of such
Guarantor under its Subsidiary Guarantee;
(2) immediately after giving effect to such transaction (and
treating any Indebtedness that becomes an obligation of the
resulting, surviving or transferee Person or any Subsidiary as
a result of such transaction as having been Incurred by such
Person or such Subsidiary at the time of such transaction), no
Default or Event of Default shall have occurred and be
continuing;
(3) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental
indenture (if any) comply with this Indenture; or
(4) the transaction is made in compliance with Section 5.01 (other
than clause (c) of Section 5.01).
Upon the sale or disposition of a Guarantor (by merger, consolidation,
the sale of its Capital Stock or the sale of all or substantially all of its
assets (other than by lease)) and whether or not the Guarantor is the surviving
corporation in such transaction to a Person which is not the Company or a
Subsidiary, such Guarantor will be automatically released from all its
obligations under this Indenture and its Subsidiary Guarantee and the
Registration Rights Agreement and such Subsidiary Guarantee will terminate;
PROVIDED, HOWEVER, that (1) the sale or other disposition is in compliance with
this Indenture, including Section 5.01 (other than clause (c) thereof); and (2)
all the obligations of such Guarantor under the Credit Facility and related
documentation and any other obligations of such Guarantor relating to any other
Indebtedness of the Company or its Subsidiaries terminate upon consummation of
such transaction.
(c) Each Guarantor shall be deemed released from all its
obligations under this Indenture and the Registration Rights Agreement and such
Subsidiary Guarantee shall terminate upon the legal defeasance of the Securities
pursuant to the provisions of Article Eight hereof.
56
(d) Each Guarantor shall be released from its obligations under
this Indenture, its Subsidiary Guarantee and the Registration Rights Agreement
if the Company designates such Guarantor as an Unrestricted Subsidiary and such
designation complies with the other applicable provisions of this Indenture.
SECTION 10.04. RIGHT OF CONTRIBUTION. Each Guarantor hereby agrees
that to the extent that any Guarantor shall have paid more than its
proportionate share of any payment made on the obligations under the Subsidiary
Guarantees, such Guarantor shall be entitled to seek and receive contribution
from and against the Company, or any other Guarantor who has not paid its
proportionate share of such payment. The provisions of this Section 10.04 shall
in no respect limit the obligations and liabilities of each Guarantor to the
Trustee and the Holders and each Guarantor shall remain liable to the Trustee
and the Holders for the full amount guaranteed by such Guarantor hereunder.
SECTION 10.05. NO SUBROGATION. Notwithstanding any payment or payments
made by each Guarantor hereunder, no Guarantor shall be entitled to be
subrogated to any of the rights of the Trustee or any Holder against the Company
or any other Guarantor or any collateral security or guarantee or right of
offset held by the Trustee or any Holder for the payment of the Guarantor
Obligations, nor shall any Guarantor seek or be entitled to seek any
contribution or reimbursement from the Company or any other Guarantor in respect
of payments made by such Guarantor hereunder, until all amounts owing to the
Trustee and the Holders by the Company on account of the Guarantor Obligations
are paid in full. If any amount shall be paid to any Guarantor on account of
such subrogation rights at any time when all of the Guarantor Obligations shall
not have been paid in full, such amount shall be held by such Guarantor in trust
for the Trustee and the Holders, segregated from other funds of such Guarantor,
and shall, forthwith upon receipt by such Guarantor, be turned over to the
Trustee in the exact form received by such Guarantor (duly indorsed by such
Guarantor to the Trustee, if required), to be applied against the Guarantor
Obligations.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. TRUST INDENTURE ACT CONTROLS. If any provision of this
Indenture limits, qualifies or conflicts with another provision that is required
to be included in this Indenture by the TIA, the required provision shall
control.
SECTION 11.02. NOTICES. Any notice or communication shall be in
writing and delivered in person or mailed by first-class mail or sent by
facsimile (with a hard copy delivered in person or by mail promptly thereafter)
and addressed as follows:
if to the Company:
Xxxxxxx Xxxxxxxxxxx
Marquee Holdings Inc.
c/o X.X. Xxxxxx Partners (BHCA), LLC
57
1221 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
if to the Trustee:
HSBC Bank USA, National Association
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention of: Corporate Trust
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
Any notice or communication mailed to a Securityholder shall be mailed
to the Securityholder at the Securityholder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 11.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA 312(c).
SECTION 11.04. CERTIFICATE AND OPINION AS TO CONDITIONS. Upon any
request or application by the Company to the Trustee to take or refrain from
taking any action under this Indenture, other than the authentication of the
Initial Securities on the date hereof, the Company shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 11.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINIONS. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
58
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(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 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 or not, in the opinion of such
individual, such covenant or condition has been complied with.
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 and
form one instrument.
SECTION 11.06. WHEN SECURITIES DISREGARDED. In determining whether the
Holders of the required principal amount at maturity of Securities have
concurred in any direction, waiver or consent, Securities owned by the Company,
Marquee Inc. or the Guarantors or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with of
them shall be disregarded and deemed not to be outstanding, except that, for the
purpose of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Securities that a Trust Officer knows
are so owned shall be so disregarded. Also, subject to the foregoing, only
Securities outstanding at the time shall be considered in any such
determination.
59
SECTION 11.07. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR. The
Trustee may make reasonable rules for action by or a meeting of Securityholders.
The Registrar and the Paying Agent or co-registrar may make reasonable rules for
their functions.
SECTION 11.08. LEGAL HOLIDAYS. A "LEGAL HOLIDAY" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open in the
States of
New York or Missouri. If a payment date is a Legal Holiday, payment
shall be made on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period. If a regular record date is a
Legal Holiday, the record date shall not be affected.
SECTION 11.09. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW
YORK.
SECTION 11.10. NO RECOURSE AGAINST OTHERS. A director, officer,
employee or stockholder, as such, of the Company, Marquee Inc. and any
Guarantors shall not have any liability for any obligations of the Company or
the Guarantors under the Securities or this Indenture or for any claim based on,
in respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder shall waive and release all such liability. The
waiver and release shall be part of the consideration for the issue of the
Securities.
SECTION 11.11. SUCCESSORS. All agreements of the Company and any
Guarantor in this Indenture and the Securities shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 11.12. 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 11.13. RELIANCE ON FINANCIAL DATA. In computing any amounts
under this Indenture: (i) to the extent relevant in computing any amounts under
this Indenture the Company shall use audited financial statements of the
Company, its Subsidiaries, any Person that would become a Subsidiary in
connection with the transaction that requires the computation and any Person
from which the Company or a Subsidiary has acquired an operating business, or is
acquiring an operating business in connection with the transaction that requires
the computation (each such Person whose financial statements are relevant in
computing any particular amount, a "RELEVANT PERSON") for the period or portions
of the period to which the computation relates for which audited financial
statements are available on the date of computation and unaudited financial
statements and other current financial data based on the books and records of
the Relevant Person or Relevant Persons, as the case may be, to the extent
audited financial statements for the period or any portion of the period to
which the computation relates are not available on the date of computation; and
(ii) the Company shall be permitted to rely in good faith on the financial
statements and other financial data derived from the books and records of any
Relevant Person that are available on the date of the computation.
60
SECTION 11.14. MULTIPLE 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. One signed copy is enough to prove this
Indenture.
SECTION 11.15. TABLE OF CONTENTS; HEADINGS. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
61
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
MARQUEE HOLDINGS INC.
By: /s/ Xxxxxx Xxxx
-------------------------------
Name: Xxxxxx Xxxx
Title: President
HSBC BANK USA, NATIONAL ASSOCIATION
as Trustee
By: /s/ Herawattee Alli
-------------------------------
Name: Herawattee Alli
Title: Assistant Vice President
62
ANNEX 4.07(1)
MANAGEMENT
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
ARRANGEMENTS
AMCE has entered into employment agreements with Messrs. Xxxxx X.
Xxxxx, Xxxxxx X. Xxxxxxxxx, Xxxxxxx X. Xxxxx, Xxxx X. XxXxxxxx and Xxxxx X.
Xxxxxx each dated as of July 1, 2001. Such persons currently receive the
following annual salaries pursuant to their employment contracts: Xx.
Xxxxx--$728,300; Xx. Xxxxxxxxx--$468,200; Xx. Xxxxx--$338,200; Xx.
Xxxxxx--$331,500; and Xx. XxXxxxxx--$312,200. The employment agreements also
provide for discretionary bonuses, an automobile allowance, reimbursement of
reasonable travel and entertainment expenses and other benefits offered from
time to time to other executive officers. The employment agreement of Xx. Xxxxx
has a term of five years, that of Xx. Xxxxxxxxx has a term of three years and
those of Xx. Xxxxx, Xx. Xxxxxx and Xx. XxXxxxxx have terms of two years. On the
anniversary date of each employment agreement, one year is added to its term, so
that each employment agreement always has a five-year, three-year or two-year
term, as the case may be, as of each anniversary date. Each employment agreement
terminates generally without severance if such employee is terminated for cause
or upon such employee's retirement or resignation without good reason, each as
defined in his employment agreement. AMCE will pay the employee a pro rata
portion of the bonus he would otherwise be eligible to receive upon termination
by reason of the employee's retirement. If any of Messrs. Xxxxx, McDonald or
Xxxxxx dies or is terminated without cause or following his disability or
terminates his agreement subsequent to specified changes in his
responsibilities, annual base salary or benefits following a change of control,
each as defined in the agreement, he will be entitled to receive a lump sum cash
payment equal to two years annual base salary. If either Xx. Xxxxx or Xx.
Xxxxxxxxx dies or is terminated without cause or following his disability or
terminates his agreement for good reason or following a change of control, each
as defined in the agreement, he will be entitled to receive (i) a lump sum cash
payment equal to five times the sum of such employee's then annual base salary
and annual bonus such employee would be entitled to receive as if the target
level had been obtained and (ii) a cash payment equal to the difference between
(a) the value of all vested and unvested stock options granted to the employee
which have an exercise price per share less than the closing price per share of
our common stock on the date of termination and (b) the exercise price of such
options. The amounts payable under these employment agreements, assuming
termination by reason of a change of control as of July 1, 2004, were as
follows: Xx. Xxxxx--$6,091,500; Xx. Xxxxxxxxx--$2,340,600, Xx. Xxxxx--$676,400;
Xx. XxXxxxxx--$624,400, and Xx. Xxxxxx--$663,000. The values of outstanding
employee stock options that would be payable under these employment agreements,
assuming termination by reason of a change of control as of July 1, 2004, were
as follows: Xx. Xxxxx--$809,000 and Xx. Xxxxxxxxx--$333,000. Xx. Xxxxx and Xx.
Xxxxxxxxx have each waived their right to termination payments that would
otherwise be payable in connection with a change of control as a result of the
Merger, subject to (i) our adoption within 60 days following the
----------
(1) Capitalized terms used but not defined herein shall have the meanings set
forth in the Offering Memorandum.
consummation of the Merger of a new management stock option plan for
approximately 6% of the number of fully-diluted shares of our common stock
outstanding as of the date of the Merger and (ii) the opportunity to directly
purchase our shares at or around the time of the consummation of the Merger. Xx.
Xxxxx and Xx. Xxxxxxxxx will be granted options to purchase approximately 113
and 116, respectively, of the shares initially reserved under the new option
plan, at an exercise price equal to the effective per share price paid by the
Sponsors in the Merger. Such options will vest 20% per year subject to the
executive's continued employment and will vest in full upon consummation of a
change of control of us or Holdings. The Merger does not constitute a change of
control as defined in the employment agreements of Messrs. Xxxxx, McDonald or
Xxxxxx.
As permitted by AMCE's 1994 and 1999 stock option and incentive plans,
stock options granted to participants thereunder provide for acceleration upon
the termination of employment within one year after the occurrence of certain
change of control events, whether such termination is voluntary or involuntary,
or with or without cause. In addition, the compensation committee may permit
acceleration upon the occurrence of certain extraordinary transactions which may
not constitute a change of control. The compensation committee may also permit
acceleration of awards under the 2003 Long-Term Incentive Plan upon the
occurrence of a change of control. The Merger will constitute a change of
control under AMCE's 1994 and 1999 stock option and incentive plans and
accordingly all outstanding options will be cancelled and holders of
in-the-money options under these plans will receive cash payments as a result of
the Merger. See "Use of Proceeds."
AMCE maintain a severance pay plan for full-time salaried
nonbargaining employees with at least 90 days of service. For an eligible
employee who is subject to the Fair Labor Standards Act overtime pay
requirements, referred to as a "nonexempt eligible employee," the plan provides
for severance pay in the case of involuntary termination of employment due to
layoff of the greater of two week's basic pay or one week's basic pay multiplied
by the employee's full years of service up to no more than twelve weeks' basic
pay. There is no severance pay for a voluntary termination, unless up to two
weeks' pay is authorized in lieu of notice. There is no severance pay for an
involuntary termination due to an employee's misconduct. Only two weeks'
severance pay is paid for an involuntary termination due to substandard
performance. For an eligible employee who is exempt from the overtime pay
requirements, severance pay is discretionary (at the department head/supervisor
level), but will not be less than the amount that would be paid to a nonexempt
eligible employee.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
AMC Entertainment seeks to ensure that all transactions with related
parties are fair, reasonable and in its best interest. In this regard, generally
its board of directors or one of its committees reviews material transactions
between it and related parties to determine that, in their best business
judgment, such transactions meet that standard. AMC Entertainment believes that
each of these transactions was on terms at least as favorable to it as could
have been obtained from an unaffiliated third party. Set forth below is a
description of certain transactions which have occurred since April 4, 2003 or
which include obligations that remain outstanding as of April 1, 2004.
In connection with the Company's 1997 merger with Xxxxxxx, Inc., the
Company agreed to pay Xx. Xxxxxxx X. Xxxxxxx'x estate any credit amounts arising
after March 31, 2000 that result from next tax benefits that the Company
realizes from the utilization of alternative minimum tax credit carry-forwards
and Missouri operating loss carry-forwards of Xxxxxxx, Inc. The maximum amount
of credit amounts that could be paid to Xx. Xxxxxxx'x estate is approximately
$1.1 million. As of April 1, 2004, the Company has not realized any of Xxxxxxx,
Inc.'s net tax benefits on the tax returns it has filed since 1998.
AMC Entertainment leases certain of its theatres from Entertainment
Properties Trust ("EPT"). Xx. Xxxxx X. Xxxxx, Chairman of the Board, Chief
Executive Officer and President of AMCE was also the Chairman of the Board of
Trustees of EPT until May of 2003 at which time his term expired and he did not
stand for reelection to the Board of Trustees of EPT. Payments to EPT for rent
were approximately $65,000,000 in fiscal 2004.
During fiscal 2004, AMC Entertainment sold the real estate assets
associated with three theatres to EPT for an aggregate purchase price of
approximately $63.9 million and then leased the real estate assets associated
with the theatres from EPT pursuant to non-cancelable operating leases with
terms of 20 years at an initial lease rate of 9.5% with options to extend for up
to an additional 15 years. The leases are triple net leases that require AMC
Entertainment to pay substantially all expenses associated with the operation of
the theatres, such as taxes and other governmental charges, insurance,
utilities, service, maintenance and any ground lease payments.
On December 23, 2003 and January 29, 2004, AMC Entertainment approved
payment of legal fees in the amount of $590,000 and reimbursement of other
out-of-pocket expenses in the amount of $170,000 on behalf of the initial
purchasers of its Series A convertible preferred stock. On November 18, 2003,
December 23, 2003 and May 25, 2004, AMC Entertainment approved payment of legal
fees in the amount of $235,000 on behalf of its Class B stockholder, the Xxxxxxx
Voting Trust. The costs were incurred in connection with the consideration of a
possible business combination between AMC Entertainment and Loews Cineplex
Entertainment Corporation. On January 22, 2004, AMC Entertainment announced that
its previously announced discussions with Loews Cineplex Entertainment
Corporation relating to a possible business combination have been terminated.
On April 19, 2001, AMC Entertainment entered into an investment
agreement and certain related agreements with certain affiliates of Apollo, one
of the Sponsors. Pursuant to that agreement, AMC Entertainment sold the Apollo
affiliates an aggregate of 92,000 shares of Series A convertible preferred stock
and 158,000 shares of Series B exchangeable preferred stock. All outstanding
Series B exchangeable preferred stock was subsequently exchanged for Series A
convertible preferred stock. As of April 19, 2004, the Apollo affiliates owned
94.1% of AMC Entertainment's Series A convertible preferred stock. Pursuant to
its agreements with the Apollo affiliates, AMC Entertainment may not take
certain corporate actions, including the consummation of the Merger and the
issuance of the Opco notes, without the prior consent of Apollo. We refer to
these approval rights granted to the Apollo affiliates as the "preferred stock
approval rights."
Apollo has consented to the Merger for purposes of its preferred stock
approval rights. See "Apollo and Xxxxxxx voting agreements" below. In connection
with the Merger, Apollo will receive up to an aggregate amount of cash proceeds
for its AMCE shares of approximately (i) $869.8 million if the Merger is
consummated on or after October 1, 2004 up to and including December 31, 2004,
including $85.7 million attributable to distributions payable to Apollo pursuant
to the terms of the Series A convertible preferred stock and (ii) due to the
timing of dividend payments at the end of each calendar quarter for the Series A
convertible preferred stock, $855.3 million if the Merger is consummated on or
after January 1, 2005 up to and including January 31, 2005, including $71.3
million attributable to distributions payable to Apollo pursuant to the terms of
the Series A convertible preferred stock. Additionally, the Sponsors will
receive $20.0 million in the aggregate in payment of transaction fees in
connection with the Transactions, which are included in "Use of Proceeds." Upon
consummation of the Merger, JPMP and Apollo will own a majority, and certain
members of management will own a portion, of the voting stock of Holdings.
Affiliates of JPMorgan Chase Bank, who are affiliates of JPMP, are an
initial purchaser of the notes and have provided commitments with respect to
certain of the financings contemplated hereby. See "Summary--The Transactions."
In addition, X.X. Xxxxxx Trust Company, National Association, which is an
affiliate of JPMP, is acting as escrow agent and securities intermediary in
connection with the escrow account described in this offering memorandum and in
connection with the Opco Notes, for which it will be paid customary fees.
For a description of certain employment agreements between AMC
Entertainment and Messrs. Xxxxx X. Xxxxx, Xxxxxx X. Xxxxxxxxx, Xxxx X. XxXxxxxx,
Xxxxxxx X. Xxxxx and Xxxxx X. Xxxxxx, see "Management--Employment Contracts,
Termination of Employment and Change of Control Arrangements."
SUBSCRIPTION AGREEMENT
In connection with the Transactions, JPMP and Apollo entered into a
subscription agreement on July 22, 2004 that provided that JPMP and Apollo have
committed to contribute approximately $393.5 million and approximately $391.9
million, respectively, to Holdings in exchange for 50.1% and 49.9% of Holdings'
common stock, respectively, although these percentages will be reduced once
certain members of management purchase common stock of Holdings in amounts to be
determined. The agreement provides that we will be prohibited from taking
certain significant actions including those related to tax structuring,
financing, selection and arrangements for retention of management and regulatory
approvals and from taking any action or making any decision relating to the
merger agreement without the approval of both Sponsors. The Sponsors also agreed
to in good faith negotiate their rights and obligations with respect to
registration rights, tag-along rights, drag-along rights and obligations,
transfer restrictions and pre-IPO preemptive rights before consummation of the
Merger, but have not done so as of the date of this offering memorandum.
Holdings may pay the Sponsors an annual management fee of up to $2.0 million in
the aggregate although no final decision has been made in this regard.
APOLLO AND XXXXXXX VOTING AGREEMENTS
In connection with the Transactions, AMC Entertainment entered into
voting agreements with Apollo and certain of its affiliates as well as the
Xxxxxxx Voting Trust. Under each of their respective agreements, Apollo and the
Xxxxxxx Voting Trust each agreed to vote, with respect to Apollo and its
affiliates, their respective shares of common stock, including any common stock
received upon the conversion of preferred stock and, with respect to the Xxxxxxx
Voting Trust, its shares of Class B common stock, in favor of the Merger and
related transactions and against any action that Apollo or the Xxxxxxx Voting
Trust, as the case may be, is aware would result in a breach of the
Merger
Agreement or would reasonably be expected to result in a failure of a condition
to the
Merger Agreement. AMC Entertainment also granted a waiver of certain
restrictions under existing agreements, allowing Apollo and other stockholders
to convert their shares of preferred stock into common stock immediately prior
to the Merger in accordance with AMC Entertainment's certificate of designations
relating to the preferred stock. In addition, pursuant to the Apollo voting
agreement, Apollo has consented to the Merger. Both of the Apollo and Xxxxxxx
voting agreements terminate in the event the Company's Independent Committee or
Board of Directors changes its recommendation of the Merger to the shareholders
or in the event the
Merger Agreement terminates in accordance with its terms.
Apollo has also consented to the Merger and the other transactions contemplated
by the
Merger Agreement for purposes of its "preferred stock approval rights"
granted to it pursuant to the April 2001 investment agreement.
TAX SHARING AGREEMENT
We will enter into a tax sharing agreement with AMC Entertainment
under which AMC Entertainment will make cash payments to us to enable us to pay
any (i) Federal, state or local income taxes to the extent that such income
taxes are directly attributable to AMC Entertainment and its subsidiaries income
and (ii) franchise taxes and other fees required to maintain our legal existence
as well as up to $3.5 million in any fiscal year to permit us to pay our
corporate overhead expenses incurred in the ordinary course of business and
salaries or other compensation of employees who perform services for both us and
AMC Entertainment.
EXHIBIT A
PROVISIONS RELATING TO INITIAL
SECURITIES AND EXCHANGE SECURITIES
I. DEFINITIONS
For the purposes of this Exhibit A the following terms shall have the
meanings indicated below:
"ADDITIONAL SECURITIES" means the 12% Senior Discount Notes due 2014,
to be originally issued from time to time, excluding Exchange Securities and
Private Exchange Securities, in one or more series as provided for in this
Indenture.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
transaction involving a Regulation S Global Security or beneficial interest
therein, the rules and procedures of the Depository for such Global Security,
Euroclear and Clearstream, in each case to the extent applicable to such
transaction and as in effect from time to time.
"CLEARSTREAM" means Clearstream Luxembourg, a societe anonyme.
"DEFINITIVE SECURITY" means a certificated Initial Security or an
Exchange Security or Private Exchange Security bearing, if required, the
restricted securities legend set forth in Section 2.3(e).
"DEPOSITORY" means The Depository Trust Company, its nominees and
their respective successors.
"DISTRIBUTION COMPLIANCE PERIOD", with respect to any Securities,
means the period of 40 consecutive days beginning on and including the later of
(i) the day on which such Securities are first offered to persons other than
distributors (as defined in Regulation S under the Securities Act) in reliance
on Regulation S, notice of which day shall be promptly given by the Company to
the Trustee and (ii) the Issue Date, and with respect to any Additional
Securities that are Transfer Restricted Securities, it means the comparable 40
consecutive days.
"EUROCLEAR" means Xxxxxx Guaranty Trust Company of
New York, Brussels
office, as operator of Euroclear System.
"EXCHANGE SECURITIES" means the 12% Senior Discount Notes due 2014 to
be issued pursuant to this Indenture in connection with a Registered Exchange
Offer pursuant to the Registration Rights Agreement.
"GLOBAL SECURITIES LEGEND" means the legend appearing under such title
on Appendix 1 to this Exhibit A.
"IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
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"INITIAL PURCHASERS" means X.X. Xxxxxx Securities Inc., Citigroup
Global Markets Inc., UBS Securities LLC, BNP Paribas Securities Corp. and Scotia
Capital (USA) Inc.
"INITIAL SECURITIES" means Initial Securities in the aggregate
principal amount at maturity of $304,000,000 issued on August 18, 2004.
"NEW SECURITIES" shall have the meaning set forth in Section 1 of the
Registration Rights Agreement.
"PRIVATE EXCHANGE" means the offer by the Company, pursuant to
Section 2(f) of the Registration Rights Agreement dated August 18, 2004, or
pursuant to any similar provision of any other Registration Rights Agreement, to
issue and deliver to certain purchasers, in exchange for the Initial Securities
held by such purchasers as part of their initial distribution, a like aggregate
principal amount at maturity of Private Exchange Securities.
"PRIVATE EXCHANGE SECURITIES" means those New Securities to be issued
pursuant to this Indenture in connection with a Private Exchange pursuant to a
Registration Rights Agreement.
"PURCHASE AGREEMENT" means the Purchase Agreement dated August 6,
2004, between the Company and the Initial Purchasers relating to the Initial
Securities, or any similar agreement relating to any future sale of Additional
Securities by the Company.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"REGISTERED EXCHANGE OFFER" means the offer by the Company, pursuant
to a Registration Rights Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial or Additional
Securities, as the case may be, a like aggregate principal amount at maturity of
Exchange Securities registered under the Securities Act.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement dated August 18, 2004, between the Company and the Initial Purchasers
relating to the Initial Securities, or any similar agreement relating to any
Additional Securities.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S SECURITIES" means all Initial Securities offered and
sold outside the United States in reliance on Regulation S.
"RESTRICTED SECURITIES LEGEND" means any of the restricted securities
legends set forth in Section 2.3(e)(i) herein.
"RULE 144A SECURITIES" means all Initial Securities offered and sold
to QIBs in reliance on Rule 144A.
"SECURITIES" means the Initial Securities, the Additional Securities,
the Exchange Securities and the Private Exchange Securities, treated as a single
class.
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"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES CUSTODIAN" means the custodian with respect to a Global
Security (as appointed by the Depository) or any successor person thereto, who
shall initially be the Trustee.
"SHELF REGISTRATION STATEMENT" means a registration statement issued
by the Company in connection with the offer and sale of Initial Securities,
Additional Securities or Private Exchange Securities pursuant to a Registration
Rights Agreement.
"TEMPORARY REGULATION S GLOBAL SECURITY" means the securities offered
and sold outside the United States in reliance on Regulation S, issued and only
available initially in the form of one or more temporary global Securities with
such applicable legends as are provided for in Section 2.3(e)(i).
"TRANSFER RESTRICTED SECURITIES" means Definitive Securities and any
other Securities that bear or are required to bear the legend set forth in
Section 2.3(e)(i) hereto.
1.1 OTHER DEFINITIONS
TERM DEFINED IN SECTION
"Agent Members"..................................................................... 2.1(c)
"Global Security"................................................................... 2.1(b)
"IAI Global Security"............................................................... 2.1(b)
"Regulation S"...................................................................... 2.1
"Regulation S Global Security"...................................................... 2.1(b)
"Rule 144A"......................................................................... 2.1
II. THE SECURITIES
2.1 FORM AND DATING. (a) The Initial Securities and any Additional
Securities will be offered and sold by the Company, from time to time, pursuant
to one or more Purchase Agreements. Unless registered or exempt from
registration under the Securities Act, the Initial Securities and any Additional
Securities will be resold, initially only to QIBs in reliance on Rule 144A under
the Securities Act ("RULE 144A") and to non-U.S. persons in reliance on
Regulation S under the Securities Act ("REGULATION S"). Initial Securities and
Additional Securities so issued may thereafter be transferred to, among others,
QIBs, purchasers in reliance on Regulation S and IAIs under Rule 501(a)(1), (2),
(3) or (7) under the Securities Act, subject to the restrictions on transfers
set forth herein.
(b) GLOBAL SECURITIES. Rule 144A Securities shall be issued initially in
the form of one or more permanent global Securities in definitive, fully
registered form (collectively, the "Rule 144A Global Security") and Regulation S
Securities shall be issued initially in the form of one or more global Temporary
Regulation S Global Securities (collectively, the "Regulation S Global
Security"), in each case without interest coupons and bearing the Global
Securities Legend and Restricted Securities Legend, which shall be deposited on
behalf of the purchasers of the Securities represented thereby with the
Securities Custodian, and registered in the name of the Depository or a nominee
of the Depository, duly executed by the Company and authenticated
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by the Trustee as provided in this Indenture. One or more global securities in
definitive, fully registered form without interest coupons and bearing the
Global Securities Legend and the Restricted Securities Legend (collectively, the
"IAI Global Security") shall also be issued on the Issue Date, deposited with
the Securities Custodian, and registered in the name of the Depository or a
nominee of the Depository, duly executed by the Company and authenticated by the
Trustee as provided in this Indenture to accommodate transfers of beneficial
interests in the Securities to IAIs subsequent to the initial distribution.
Beneficial ownership interests in the Temporary Regulation S Global Security
shall not be exchangeable for interests in the Rule 144A Global Security, the
IAI Global Security, a permanent Regulation S Global Security or any Security
without a Restricted Securities Legend until the expiration of the Distribution
Compliance Period. The Rule 144A Global Security, the IAI Global Security and
the Regulation S Global Security are each referred to herein as a "Global
Security" and are collectively referred to herein as "Global Securities";
PROVIDED that the term "Global Security" when used in Sections 2.1(b), 2.1(c),
2.3(g)(i), 2.3(h)(i) and 2.4 shall also include any Security in global form
issued in connection with a Registered Exchange Offer. The aggregate principal
amount at maturity of the Global Securities may from time to time be increased
or decreased by adjustments made on the records of the Trustee and the
Depository or its nominee and on the schedules thereto as hereinafter provided.
(c) BOOK-ENTRY PROVISIONS. This Section 2.1(b) shall apply only to
a Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.1(b) and pursuant to an order of the Company, authenticate and
deliver initially one or more Global Securities that (a) shall be registered in
the name of the Depository for such Global Security or Global Securities or the
nominee of such Depository and (b) shall be delivered by the Trustee to such
Depository or pursuant to such Depository's instructions or held by the Trustee
as Securities Custodian.
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 by the Trustee as Securities Custodian or
under such 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
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depository or impair, as between the
Depository and its Agent Members, the operation of customary practices of such
Depository governing the exercise of the rights of a holder of a beneficial
interest in any Global Security.
(d) DEFINITIVE SECURITIES. Except as provided in Section 2.3,
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of certificated Securities.
2.2 AUTHENTICATION. The Trustee shall authenticate and deliver:
(1) Initial Securities for original issue in an aggregate principal amount at
maturity of $304,000,000, (2) any Additional Securities, if and when issued
pursuant to the Indenture; and (3) the Exchange
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Securities for issue only in a Registered Exchange Offer or a Private Exchange,
respectively, pursuant to a Registration Rights Agreement, for a like principal
amount at maturity of Initial Securities or Additional Securities, in each case
upon a written order of the Company signed by two Officers or by an Officer and
either a Treasurer or an Assistant Treasurer or a Secretary or an Assistant
Secretary of the Company. Such order shall specify the amount of the Securities
to be authenticated and the date on which the original issue of Securities is to
be authenticated and whether the Securities are to be Initial Securities,
Additional Securities, Exchange Securities or Private Exchange Securities.
2.3 TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF DEFINITIVE
SECURITIES. When Definitive Securities are presented to the Registrar or a
co-registrar with a request:
(i) to register the transfer of such Definitive Securities; or
(ii) to exchange such Definitive Securities for an equal principal
amount at maturity of Definitive Securities of other authorized
denominations, the Registrar or co-registrar shall register the transfer or
make the exchange as requested if its reasonable requirements for such
transaction are met; provided, however, that the Definitive Securities
surrendered for transfer or exchange:
(1) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company
and the Registrar or co-registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing; and
(2) are being transferred or exchanged pursuant to an
effective registration statement under the Securities Act or pursuant
to clause (A), (B) or (C) below, and are accompanied by the following
additional information and documents, as applicable:
(A) if such Definitive Securities are being delivered
to the Registrar by a Holder for registration in the name of
such Holder, without transfer, a certification from such
Holder to that effect; or
(B) if such Definitive Securities are being
transferred to the Company, a certification to that effect; or
(C) if such Definitive Securities are being
transferred pursuant to an exemption from registration in
accordance with Rule 144 under the Securities Act, (i) a
certification to that effect and (ii) if the Company so
requests, an opinion of counsel or other evidence reasonably
satisfactory to it as to the compliance with the restrictions
set forth in the legend set forth in Section 2.3(e)(i).
(b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE SECURITY FOR A BENEFICIAL
INTEREST IN A GLOBAL SECURITY. A Definitive Security may not be exchanged for a
beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below. Upon receipt by the
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Trustee of a Definitive Security, duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company and the
Registrar, together with:
(i) certification (in the form set forth on the reverse side of
the Initial Security) that such Definitive Security is being transferred
(1) to a QIB in accordance with Rule 144A, (2) to an IAI that has furnished
to the Trustee a signed letter substantially in the form of Exhibit B or
(3) outside the United States in an offshore transaction within the meaning
of Regulation S and in compliance with Rule 904 under the Securities Act,
which certification shall be accompanied by a signed letter substantially
in the form of Exhibit C; and
(ii) written instructions directing the Trustee to make, or to
direct the Securities Custodian to make, an adjustment on its books and
records with respect to such Global Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Global
Security, such instructions to contain information regarding the Depository
account to be credited with such increase,
then the Trustee shall cancel such Definitive Security and cause, or direct
the Securities Custodian to cause, in accordance with the standing
instructions and procedures existing between the Depository and the
Securities Custodian, the aggregate principal amount of Securities
represented by the Global Security to be increased by the aggregate
principal amount of the Definitive Security to be exchanged and shall
credit or cause to be credited to the account of the Person specified in
such instructions a beneficial interest in the Global Security equal to the
principal amount of the Definitive Security so canceled. If no Global
Securities are then outstanding and the Global Security has not been
previously exchanged for certificated securities pursuant to Section 2.4,
the Company shall issue and the Trustee shall authenticate, upon written
order of the Company in the form of an Officers' Certificate, a new Global
Security in the appropriate principal amount.
(c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES.
(i) The transfer and exchange of Global Securities or beneficial
interests therein shall be effected through the Depository, in accordance
with this Indenture (including applicable restrictions on transfer set
forth herein, if any) and the procedures of the Depository therefor. A
transferor of a beneficial interest in a Global Security shall deliver a
written order given in accordance with the Depository's procedures
containing information regarding the participant account of the Depository
to be credited with a beneficial interest in the Global Security and such
account shall be credited in accordance with such instructions with a
beneficial interest in the Global Security and the account of the Person
making the transfer shall be debited by an amount equal to the beneficial
interest in the Global Security being transferred. Transfers by an owner of
a beneficial interest in the Rule 144A Global Security or the IAI Global
Security to a transferee who takes delivery of such interest through the
Regulation S Global Security, whether before or after the expiration of the
Distribution Compliance Period, shall be made only upon receipt by the
Trustee of a certification in the form provided on the reverse of the
Initial Securities from the transferor to the effect that such transfer is
being made in accordance with Regulation S or (if available) Rule 144 under
the Securities Act and that, if such
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transfer is being made prior to the expiration of the Distribution
Compliance Period, the interest transferred shall be held immediately
thereafter through Euroclear or Clearstream. In the case of a transfer of a
beneficial interest in either the Regulation S Global Security or the Rule
144A Global Security for an interest in the IAI Global Security, the
transferee must furnish a signed letter substantially in the form of
Exhibit B to the Trustee.
(ii) If the proposed transfer is a transfer of a beneficial
interest in one Global Security to a beneficial interest in another Global
Security, the Registrar shall reflect on its books and records the date and
an increase in the principal amount at maturity of the Global Security to
which such interest is being transferred in an amount equal to the
principal amount at maturity of the interest to be so transferred, and the
Registrar shall reflect on its books and records the date and a
corresponding decrease in the principal amount at maturity of Global
Security from which such interest is being transferred.
(iii) Notwithstanding any other provisions of this Exhibit A (other
than the provisions set forth in Section 2.4), a Global Security may not be
transferred as a whole except 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 or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(iv) In the event that a Global Security is exchanged for
Securities in definitive registered form pursuant to Section 2.4 prior to
the consummation of a Registered Exchange Offer or the effectiveness of a
Shelf Registration Statement with respect to such Securities, such
Securities may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3 (including
the certification requirements set forth on the reverse of the Initial
Securities or Additional Securities intended to ensure that such transfers
comply with Rule 144A, Regulation S or such other applicable exemption from
registration under the Securities Act, as the case may be) and such other
procedures as may from time to time be adopted by the Company.
(d) RESTRICTIONS ON TRANSFER OF REGULATION S GLOBAL SECURITY. (i) Prior to
the expiration of the Distribution Compliance Period, interests in the
Regulation S Global Security may only be held through Euroclear or Clearstream.
During the Distribution Compliance Period, beneficial ownership interests in the
Regulation S Global Security may only be sold, pledged or transferred through
Euroclear or Clearstream in accordance with the Applicable Procedures and only
(1) to the Company, (2) so long as such security is eligible for resale pursuant
to Rule 144A, to a person whom the selling holder reasonably believes is a QIB
that purchases for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule
144A, (3) in an offshore transaction in accordance with Regulation S, (4)
pursuant to an exemption from registration under the Securities Act provided by
Rule 144 (if applicable) under the Securities Act, (5) to an IAI purchasing for
its own account, or for the account of such an IAI, in each case, in a minimum
principal amount of Securities of $250,000 or (6) pursuant to an effective
registration statement under the Securities Act, in each case in accordance with
any applicable securities laws of any state of the United States. Prior to the
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expiration of the Distribution Compliance Period, transfers by an owner of a
beneficial interest in the Regulation S Global Security to a transferee who
takes delivery of such interest through the Rule 144A Global Security or the IAI
Global Security shall be made only in accordance with Applicable Procedures and
upon receipt by the Trustee of a written certification from the transferor of
the beneficial interest in the form provided on the reverse of the Initial
Security to the effect that such transfer is being made to (1) a QIB within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A or
(2) an IAI purchasing for its own account, or for the account of such an IAI, in
a minimum principal amount of the Securities of $250,000. Such written
certification shall no longer be required after the expiration of the
Distribution Compliance Period. In the case of a transfer of a beneficial
interest in the Regulation S Global Security for an interest in the IAI Global
Security, the transferee must furnish a signed letter substantially in the form
of Exhibit B to the Trustee.
(ii) Upon the expiration of the Distribution Compliance Period, beneficial
ownership interests in the Regulation S Global Security shall be transferable in
accordance with applicable law and the other terms of this Indenture.
(e) LEGEND.
(i) Except as permitted by the following paragraphs (ii), (iii),
(iv) and (v), each certificate evidencing the Global Securities and the
Definitive Securities and the Temporary Regulation S Global Security (prior
to the expiration of the Distribution Compliance Period) (and all
Securities issued in exchange therefor or in substitution thereof) shall
bear a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (1) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (2) PURSUANT
TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (3) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A (AS INDICATED
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BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE
REVERSE OF THIS SECURITY), (4) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (5) TO AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE
SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT AT MATURITY OF THE SECURITIES OF $250,000, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION
WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (6) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSES (4), (5) OR (6) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER
THE RESALE RESTRICTION TERMINATION DATE.
THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS (A) A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A, (B) AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT
AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION OR (C) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT.
Each Definitive Security will also bear the following additional
legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
Prior to the Distribution Compliance Period, each Temporary Regulation
S Global Security will also bear the following additional legend:
EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN
THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN
INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND
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CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE "40-DAY
DISTRIBUTION COMPLIANCE PERIOD" (WITHIN THE MEANING OF RULE 903(B)(2) OF
REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM
REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED
EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A
TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING
SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED
THROUGH EUROCLEAR SYSTEM OR CLEARSTREAM LUXEMBOURG, A SOCIETE ANONYME AND ONLY
(1) TO THE COMPANY, (2) WITHIN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (3) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904
UNDER THE SECURITIES ACT OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (1) THROUGH (4) IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND OTHER
JURISDICTIONS. HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATIONS S GLOBAL
SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS
REFERRED TO ABOVE, IF THEN APPLICABLE.
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
MAY BE EXCHANGED FOR INTERESTS IN A GLOBAL TRANSFER RESTRICTED SECURITY ONLY IF
(1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN
COMPLIANCE WITH RULE 144A, AND (2) THE TRANSFEROR OF THE TEMPORARY REGULATION S
GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM
ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL
SECURITY IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY
BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A,
(B) TO A PERSON WHO IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A AND (C) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF
THE UNITED STATES AND OTHER JURISDICTIONS.
BENEFICIAL INTERESTS IN A GLOBAL TRANSFER RESTRICTED SECURITY MAY BE
TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE
REGULATION S GLOBAL SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE
40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO
THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO
THE EFFECT THAT IF SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR
904 OF REGULATION S OR RULE 144 (IF AVAILABLE) AND THAT, IF SUCH TRANSFER OCCURS
PRIOR TO THE EXPIRATION OF THE 40-DAY DISTRIBUTION
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COMPLIANCE PERIOD, THE INTEREST TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER
THROUGH EUROCLEAR SYSTEM OR CLEARSTREAM LUXEMBOURG, A SOCIETE ANONYME.
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global
Security) pursuant to Rule 144 under the Securities Act:
(A) in the case of any Transfer Restricted Security that is
a Definitive Security, the Registrar shall permit the Holder thereof
to exchange such Transfer Restricted Security for a Definitive
Security that does not bear the legends set forth above and rescind
any restriction on the transfer of such Transfer Restricted Security;
and
(B) in the case of any Transfer Restricted Security that is
represented by a Global Security, the Registrar shall permit the
beneficial owner thereof to exchange such Transfer Restricted Security
for a beneficial interest in a Global Security that does not bear the
legends set forth above and rescind any restriction on the transfer of
such Transfer Restricted Security, in either case, if the Holder
certifies in writing to the Registrar that its request for such
exchange was made in reliance on Rule 144 (such certification to be in
the form set forth on the reverse of the Initial Security).
(iii) After a transfer of any Initial Securities, Additional
Securities or Private Exchange Securities, as the case may be, during the
period of the effectiveness of a Shelf Registration Statement with respect
to such Initial Securities, Additional Securities or Private Exchange
Securities, all requirements pertaining to restricted legends on such
Initial Security or such Private Exchange Securities will cease to apply,
and a global Initial Security or Private Exchange Security without
restricted legends will be available to the transferee of the beneficial
interests in such Initial Securities, Additional Securities or Private
Exchange Securities. Upon the occurrence of any of the circumstances
described in this paragraph, the Company will deliver an Officers'
Certificate to the Trustee instructing the Trustee to issue Securities
without legends.
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Securities or Additional Securities pursuant to
which certain Holders of such Initial Securities or Additional Securities
are offered Exchange Securities in exchange for their Initial Securities,
Additional Securities, or Exchange Securities in global form without
restrictive legends will be available to Holders or beneficial owners that
exchange such Initial Securities or Additional Securities (or beneficial
interests therein) in such Registered Exchange Offer. Upon the occurrence
of any of the circumstances described in this paragraph, the Company will
deliver an Officers' Certificate to the Trustee instructing the Trustee to
issue Securities without restricted legends.
(v) Upon the consummation of a Private Exchange with respect to
the Initial
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Securities or Additional Securities pursuant to which Holders of such
Initial Securities or Additional Securities are offered Private Exchange
Securities in exchange for their Initial Securities or Additional
Securities, as the case may be, all requirements pertaining to such Initial
Securities that Initial Securities issued to certain Holders be issued in
global form will continue to apply, and Private Exchange Securities in
global form with, to the extent required by applicable law, the Restricted
Securities Legend set forth in Appendix I hereto will be available to
Holders that exchange such Initial Securities or Additional Securities in
such Private Exchange.
(vi) Upon a sale or transfer after the expiration of the
Distribution Compliance Period of any Initial Security acquired pursuant to
Regulation S, all requirements that such Initial Security bear any
Restricted Securities Legend shall cease to apply and the requirements
requiring any such Initial Security be issued in global form shall continue
to apply.
(f) CANCELLATION OR ADJUSTMENT OF GLOBAL SECURITY. At such time as
all beneficial interests in a Global Security have either been exchanged for
certificated or Definitive Securities, redeemed, repurchased or canceled, such
Global Security shall be returned by the Depository to the Trustee for
cancellation or retained and canceled by the Trustee. At any time prior to such
cancellation, if any beneficial interest in a Global Security is exchanged for
certificated or Definitive Securities, redeemed, repurchased or canceled, the
principal amount at maturity of Securities represented by such Global Security
shall be reduced and an adjustment shall be made on the books and records of the
Trustee (if it is then the Securities Custodian for such Global Security) with
respect to such Global Security, by the Trustee or the Securities Custodian, to
reflect such reduction.
(g) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF
SECURITIES.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate certificated
Securities, Definitive Securities and Global Securities at the Registrar's
or co-registrar's request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company or the Trustee may require payment of
a sum sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any such
transfer taxes, assessments or similar governmental charge payable upon
exchange or registration of transfer pursuant to Sections 3.06, 4.10 and
9.05 of this Indenture).
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of any Security for a period beginning
15 days before the mailing of a notice of redemption or an offer to
repurchase Securities or 15 days before an interest payment date.
(iv) Prior to the due presentation for registration of transfer of
any Security, the Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such Security and for all
other purposes whatsoever, whether or not such Security is overdue,
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and none of the Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar shall be affected by notice to the contrary.
(v) All Securities issued upon any registration of transfer or
exchange pursuant to the terms of this Indenture shall evidence the same
debt and shall be entitled to the same benefits under this Indenture as the
Securities surrendered upon such registration of transfer or exchange.
(h) NO OBLIGATION OF THE TRUSTEE.
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in the
Depository or any other Person with respect to the accuracy of the records
of the Depository or its nominee or of any participant or member thereof,
with respect to any ownership interest in the Securities or with respect to
the delivery to any participant, member, beneficial owner or other Person
(other than the Depository) of any notice (including any notice of
redemption or repurchase) or the payment of any amount, under or with
respect to such Securities. All notices and communications to be given to
the Holders and all payments to be made to Holders under the Securities
shall be given or made only to the registered Holders (which shall be the
Depository or its nominee in the case of a Global Security). The rights of
beneficial owners in any Global Security shall be exercised only through
the Depository subject to the applicable rules and procedures of the
Depository. The Trustee may rely and shall be fully protected in relying
upon information furnished by the Depository with respect to its members,
participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between
or among Depository participants, members or beneficial owners in any
Global Security) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do so
if and when expressly required by, the terms of this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
2.4 CERTIFICATED SECURITIES.
(a) Global Security deposited with the Depository or with the
Trustee as Securities Custodian pursuant to Section 2.1 shall be transferred to
the beneficial owners thereof in the form of certificated Securities in an
aggregate principal amount at maturity equal to the principal amount at maturity
of such Global Security, in exchange for such Global Security, only 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
depositary is not appointed by the Company within 90 days of such notice, or
(ii) a Default or an Event of Default has occurred and is continuing under the
Indenture or (iii) the Company, in its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of certificated Securities under
this Indenture.
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(b) Any Global Security that is transferable to the beneficial
owners thereof pursuant to this Section 2.4 shall be surrendered by the
Depository to the Trustee located in the Borough of Manhattan, The City of New
York, to be so transferred, in whole or from time to time in part, without
charge (although the Company may require payment of a sum sufficient to cover
any tax or governmental charge imposed in connection therewith), and the Trustee
shall authenticate and deliver, upon such transfer of each portion of such
Global Security, an equal aggregate principal amount at maturity of certificated
Securities of authorized denominations. Certificated Securities issued in
exchange for any portion of a Global Security transferred pursuant to this
Section shall be executed, authenticated and delivered only in denominations of
$1,000 principal amount at maturity and any integral multiple thereof and
registered in such names as the Depository shall direct. Any certificated
Initial Security delivered in exchange for an interest in the Global Security
shall, except as otherwise provided by Section 2.3(c), bear the restricted
securities legend set forth in Appendix I hereto.
(c) The registered Holder of a Global Security may grant proxies
and otherwise authorize any Person, including Agent Members and Persons that may
hold interests through Agent Members, to take any action that a Holder is
entitled to take under this Indenture or the Securities.
(d) In the event of the occurrence of any of the events specified
in Section 2.4(a)(i), (ii) or (iii), the Company will promptly make available to
the Trustee a reasonable supply of certificated Securities in definitive, fully
registered form without interest coupons.
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APPENDIX I
To EXHIBIT A
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Transfer Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (1) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (2) PURSUANT
TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (3) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
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ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (4) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (5) TO AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE
SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT AT MATURITY OF THE SECURITIES OF $250,000, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION
WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (6) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSES (4), (5) OR (6) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER
THE RESALE RESTRICTION TERMINATION DATE.
THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS (A) A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A, (B) AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT
AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION OR (C) A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT.
[Definitive Securities Legend]
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
[Temporary Regulation S Global Securities Legend]
EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN
THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN
INTEREST IN THE
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SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING
RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE "40-DAY DISTRIBUTION
COMPLIANCE PERIOD" (WITHIN THE MEANING OF RULE 903(B)(2) OF REGULATION S UNDER
THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM REASONABLY
SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED EITHER BY
NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION
THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING SUCH 40-DAY
DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP IN THIS TEMPORARY
REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED THROUGH
EUROCLEAR SYSTEM OR CLEARSTREAM LUXEMBOURG, A SOCIETE ANONYME AND ONLY (1) TO
THE COMPANY, (2) WITHIN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (3)
OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH OF CASES (1) THROUGH (4) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND OTHER
JURISDICTIONS. HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATIONS S GLOBAL
SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS
REFERRED TO ABOVE, IF THEN APPLICABLE.
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
MAY BE EXCHANGED FOR INTERESTS IN A GLOBAL TRANSFER RESTRICTED SECURITY ONLY IF
(1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN
COMPLIANCE WITH RULE 144A, AND (2) THE TRANSFEROR OF THE TEMPORARY REGULATION S
GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM
ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL
SECURITY IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY
BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A,
(B) TO A PERSON WHO IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A AND (C) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF
THE UNITED STATES AND OTHER JURISDICTIONS.
BENEFICIAL INTERESTS IN A GLOBAL TRANSFER RESTRICTED SECURITY MAY BE
TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE
REGULATION S GLOBAL SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE
40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO
THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO
THE EFFECT THAT IF SUCH
A-17
TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF REGULATION S OR
RULE 144 (IF AVAILABLE) AND THAT, IF SUCH TRANSFER OCCURS PRIOR TO THE
EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, THE INTEREST
TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER THROUGH EUROCLEAR SYSTEM OR
CLEARSTREAM LUXEMBOURG, A SOCIETE ANONYME.
A-18
[FORM OF FACE OF INITIAL SECURITY]
12% Senior Discount Notes due 2014
No. R- CUSIP No.
MARQUEE HOLDINGS INC., a Delaware corporation, promises to pay to Cede
& Co., or registered assigns, the principal amount of Dollars ( )
on August 15, 2014.
Interest Payment Dates: February 15 and August 15.
Record Dates: February 1 and August 1.
A-19
IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed as of the ____ day of _________________, _____.
MARQUEE HOLDINGS INC.
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
HSBC BANK USA, NATIONAL
ASSOCIATION as Trustee, certifies that
this is one of the Securities referred to in the
Indenture.
By:
--------------------------------------
Authorized Officer
Additional provisions of this Security are set forth on the other side of this
Security.
A-20
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTION 1272, 1273
AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. YOU MAY CONTACT
XXXXXXX XXXXXXXXXXX , THE TREASURER OF THE ISSUER , AT MARQUEE INC., C/O X.X.
XXXXXX PARTNERS (BHCA) , L.P., 0000 XXXXXX XX XXX XXXXXXXX, 00XX XXXXX, XXX
XXXX, XX 00000-0000, WHO WILL PROVIDE YOU WITH ANY REQUIRED INFORMATION
REGARDING THE ORIGINAL ISSUE DISCOUNT.
12% Senior Discount Notes due 2014
1. INTEREST. (a).
Marquee Holdings Inc., a Delaware corporation
(such corporation, and its successors under the Indenture hereinafter referred
to, being herein called the "COMPANY"), promises to pay interest on the
principal amount at maturity of this Security at the rate per annum shown above.
Unless the Company elects to pay cash interest as described below, no cash
interest will accrue on the Securities prior to August 15, 2009. The Accreted
Value of each Security will increase from the date of issuance until August 15,
2009, at a rate of 12% per annum, compounded semiannually on each February 15
and August 15 commencing February 15, 2005, reflecting the accrual of non-cash
interest, such that the Accreted Value will equal the stated principal amount at
maturity on August 15, 2009. Cash interest on the Securities will accrue at the
rate of 12% per annum from August 15, 2009, or from the most recent date to
which interest has been paid or provided for, and will be payable in cash
semiannually on February 15 and August 15 of each year (each an "INTEREST
PAYMENT DATE"), commencing on February 15, 2010, to holders of record on the
immediately preceding February 1 and August 1, respectively. Notwithstanding the
foregoing, on any Interest Payment Date prior to August 15, 2009, the Company
may elect to commence to pay cash interest (from and after such Interest Payment
Date), in which case (i) the Company will be obligated to pay cash interest on
each subsequent Interest Payment Date, (ii) the Securities will cease to accrete
after such Interest Payment Date and (iii) the outstanding principal amount at
Stated Maturity of each Security will be equal to the Accreted Value of such
Security as of such Interest Payment Date. Interest and Accreted Value will be
computed on the basis of a 360-day year comprised of twelve 30-day months. The
Company shall pay interest on overdue principal at the rate borne by the
Securities plus 1% per annum, and it shall pay interest on overdue installments
of interest at the rate borne by the Securities to the extent lawful. Interest
will be payable as described in the foregoing paragraph, except as described
under Section 15 of this Security.
(b) ADDITIONAL INTEREST. The holder of this Security is entitled
to the benefits of a Registration Rights Agreement, dated as of August 18, 2004,
between the Company and the Initial Purchasers named therein (the "REGISTRATION
RIGHTS AGREEMENT"). The Additional Interest (as defined in the Registration
Rights Agreement), if any, will be payable in cash semiannually in arrears each
February 15 and August 15, in immediately available funds.
2. METHOD OF PAYMENT
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the February 1 or
A-21
August 1 next preceding the interest payment date even if Securities are
canceled after the record date and on or before the interest payment date.
Holders must surrender Securities to a Paying Agent to collect principal
payments. The Company will pay principal and interest in money of the United
States of America that at the time of payment is legal tender for payment of
public and private debts. Payments in respect of the Securities represented by a
Global Security (including principal, premium and interest) will be made by wire
transfer of immediately available funds to the accounts specified by The
Depository Trust Company. The Company will make all payments in respect of a
certificated Security (including principal, premium and interest) by mailing a
check to the registered address of each Holder thereof; provided, however, that
payments on the Securities may also be made, in the case of a Holder of at least
$1,000,000 aggregate principal amount at maturity of Securities, by wire
transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date for
payment (or such other date as the Trustee may accept in its discretion).
3. PAYING AGENT AND REGISTRAR
Initially, HSBC Bank USA National Association, a national banking
association (the "TRUSTEE"), will act as Paying Agent and Registrar. The Company
may appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestic Wholly-Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.
4. INDENTURE
The Company issued the Securities under an Indenture dated as of
August 18, 2004 (the "INDENTURE"), between the Company and the Trustee. The
terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
77aaa-77bbbb) as in effect on the date of the Indenture (the "TIA"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the TIA for a statement of
those terms.
The Securities are senior unsecured obligations of the Company and can
be issued in an initial amount of up to $304,000,000 aggregate principal amount
at maturity and additional amounts as part of the same series or new series
under the Indenture which are unlimited (subject to Sections 2.01 and 2.10 of
the Indenture). The Indenture imposes certain limitations on the ability of the
Company and its Subsidiaries to, among other things, incur additional
indebtedness, pay dividends or make distributions in respect of their capital
stock, purchase or redeem capital stock, enter into transactions with
stockholders or certain affiliates, create liens or consolidate, merge or sell
all or substantially all of the Company's assets, other than in certain
transactions between the Company and one or more of its Wholly-Owned
Subsidiaries. These limitations are subject to significant exceptions.
Notwithstanding anything in the Indenture to the contrary, prior to the
consummation of the merger of Marquee Inc. with and into AMC Entertainment Inc.,
the Company will be prohibited from engaging in certain activities.
5. OPTIONAL REDEMPTION
A-22
Except as set forth below and in paragraph 6 herein, the Securities
may not be redeemed prior to August 15, 2009. On and after that date, the
Company may redeem the Securities in whole at any time or in part from time to
time at the following redemption prices (expressed in percentages of principal
amount at maturity thereof), plus accrued and unpaid interest, if any, to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date that
is on or prior to the date of redemption), if redeemed during the 12-month
period beginning on or after August 15 of the years set forth below:
PERIOD REDEMPTION PRICE
2009.......................................................................... 106.000%
2010.......................................................................... 104.000%
2011.......................................................................... 102.000%
2012 and thereafter........................................................... 100.000%
Prior to August 15, 2007, the Company may on any one or more occasions
redeem up to 35% of the original aggregate principal amount at maturity of the
Securities with the Net Cash Proceeds of one or more Equity Offerings at a
redemption price of 112.000% of the Accreted Value thereof, plus accrued and
unpaid interest, if any, to the redemption date (subject to the right of holders
of record on the relevant record date to receive interest due on the relevant
interest payment date); PROVIDED that
(1) at least 65% of the original aggregate principal amount at maturity of
the Securities remains outstanding after each such redemption; and
(2) the redemption occurs within 90 days after the closing of such Equity
Offering.
6. SPECIAL REDEMPTION
In the event that (i) the
Merger Agreement is terminated or (ii) the
Transactions are not closed on or before January 31, 2005 (each a "Special
Mandatory Redemption Event"), then the Company will redeem the Securities, in
whole but not in part, within two Business Days' notice, at a redemption price
in cash equal to 100% of the Accreted Value of the Securities to, but excluding,
the Special Redemption Date pursuant to the terms of the Discount Securities
Escrow Agreement. The "Special Redemption Date" means the second Business Day
after the first Special Mandatory Redemption Event. Any redemption made pursuant
to this Section 6 shall be made pursuant to the procedures set forth in the
Discount Securities Escrow Agreement.
7. SINKING FUND
The Securities are not subject to any sinking fund.
8. NOTICE OF REDEMPTION
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his or her registered address. Securities in
denominations larger than $1,000 aggregate principal amount at maturity may be
redeemed in part but only in whole multiples of $1,000 aggregate principal
amount at maturity. If money sufficient to pay the redemption price of and
accrued
A-23
interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
9. REPURCHASE OF SECURITIES AT THE OPTION OF HOLDERS UPON CHANGE
OF CONTROL
Upon a Change of Control, the Company will be required to make an
offer, subject to certain conditions specified in the Indenture, to repurchase
all or any part of the Securities of each Holder at a purchase price equal to
101% of the Accreted Value of Securities to be repurchased plus accrued and
unpaid interest, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest due on the
interest payment date that is on or prior to the date of purchase) as provided
in, and subject to the terms of, the Indenture.
10. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form without coupons in denominations
of $1,000 aggregate principal amount at maturity and whole multiples of $1,000
aggregate principal amount at maturity. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any transfer or exchange, the
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or to transfer or exchange any Securities for a period of 15 days prior to a
selection of Securities to be redeemed or 15 days before an interest payment
date.
11. PERSONS DEEMED OWNERS
The registered Holder of this Security may be treated as the owner of
it for all purposes.
12. UNCLAIMED MONEY
If money for the payment of principal, premium or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company and not to the Trustee for payment.
13. DISCHARGE AND DEFEASANCE
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or Government Securities for the payment
of principal, premium and interest on the Securities to redemption or maturity,
as the case may be.
A-24
14. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any
Securityholder but with the written consent of the Holders of at least a
majority in aggregate principal amount at maturity of the outstanding Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of at least a majority in principal amount at
maturity of the outstanding Securities. Subject to certain exceptions set forth
in the Indenture, without the consent of any Holder of Securities, the Company
and the Trustee may amend the Indenture or the Securities (i) to cure any
ambiguity, omission, defect or inconsistency; (ii) to comply with Article Five
of the Indenture; (iii) to provide for uncertificated Securities in addition to
or in place of certificated Securities; (iv) to add Guarantees with respect to
the Securities; (v) to secure the Securities; (vi) to add additional covenants
or to surrender rights and powers conferred on the Company; (vii) to comply with
the requirements of the SEC in order to effect or maintain the qualification of
the Indenture under the TIA; or (viii) to make any change that does not
adversely affect the rights of any Securityholder.
15. DEFAULTS AND REMEDIES
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of the
Securities then outstanding, subject to certain limitations, may declare all the
Securities to be immediately due and payable. If an Event of Default relating to
certain events of bankruptcy, insolvency or reorganization of the Company
occurs, the principal of and interest on all the Securities shall become
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders and if such Event of Default occurs prior to the
earlier of (i) the Cash Election Date and (ii) August 15, 2009, the Company will
thereafter be obligated to pay cash interest on each subsequent Interest Payment
Date and the Securities will cease to accrete. Under certain circumstances, the
Holders of a majority in principal amount at maturity of the outstanding
Securities may rescind any such acceleration with respect to the Securities and
its consequences.
Holders of Securities may not enforce the Indenture or the Securities
except as provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Securities unless it receives reasonable indemnity or security.
Subject to certain limitations, Holders of a majority in aggregate principal
amount at maturity of the Securities then outstanding may direct the Trustee in
its exercise of any trust or power under the Indenture. The Holders of a
majority in aggregate principal amount at maturity of the Securities then
outstanding, by written notice to the Company and the Trustee, may rescind any
declaration of acceleration and its consequences if the rescission would not
conflict with any judgment or decree, and if all existing Events of Default have
been cured or waived except nonpayment of principal or interest that has become
due solely because of the acceleration.
16. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates
A-25
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee.
17. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
18. AUTHENTICATION
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
19. ABBREVIATIONS
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
20. GOVERNING LAW
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
21. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
A Holder of Securities may upon written request and without charge to
the Holder receive a copy of the Indenture which has in it the text of this
Security. Requests may be made to: Xxxxxxx Xxxxxxxxxxx, Marquee Inc., c/o X.X.
Xxxxxx Partners (BHCA), LLC. 1221 Avenue of the Americas, 00xx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000-0000.
A-26
ASSIGNMENT FORM
To assign this Security, fill in the form below: I or we assign and
transfer this Security to
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint __________________ agent to transfer this Security on
the books of the Company. The agent may substitute another to act for him.
Date:
Your Signature:
Sign exactly as your name appears on the other side of this Security.
A-27
In connection with any transfer of any of the Securities evidenced by
this certificate occurring prior to the expiration of the period referred to in
Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such Securities
were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Securities are being transferred in accordance with its
terms:
CHECK ONE BOX BELOW
/ / (1) to the Company; or
/ / (2) pursuant to an effective registration statement under the
Securities Act of 1933; or
/ / (3) to a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act of 1933) that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that such
transfer is being made in reliance on Rule 144A, in each case pursuant to and in
compliance with Rule 144A under the Securities Act of 1933; or
/ / (4) outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in compliance with Rule 904
under the Securities Act of 1933; or
/ / (5) to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933) that is acquiring
at least $250,000 in principal amount at maturity of the Securities and that has
furnished to the Trustee a signed letter containing certain representations and
agreements (the form of which letter can be obtained from the Trustee or the
Company); or
/ / (6) pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to
register any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that if box
(4), (5) or (6) is checked, the Trustee may require, prior to registering any
such transfer of the Securities, such legal opinions, certifications and other
information as the Company has reasonably requested to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act of 1933.
Date:
Your Signature:
A-28
Signature Guarantee:
Signature must be guaranteed by a participant in a recognized signature guaranty
medallion program or other signature guarantor acceptable to the Trustee.
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
--------------------------------
Dated:
A-29
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount at maturity of this Global Security is
$ . The following increases or decreases in this Global Security have
been made:
PRINCIPAL AMOUNT
AMOUNT OF AT MATURITY
AMOUNT OF DECREASE INCREASE IN OF THIS GLOBAL
IN PRINCIPAL AMOUNT PRINCIPAL AMOUNT SECURITY SIGNATURE OF
AT MATURITY AT MATURITY FOLLOWING SUCH AUTHORIZED SIGNATORY
OF THIS GLOBAL OF THIS GLOBAL DECREASE OR OF TRUSTEE OR
DATE OF EXCHANGE SECURITY SECURITY INCREASE SECURITIES CUSTODIAN
---------------- -------------------- ---------------- ---------------- --------------------
A-30
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.10 (Change of Control) of the Indenture, check the
box: / /
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.10 of the Indenture, state the amount:
$____________________
Date: Your Signature:
(Sign exactly as your name appears on the other side of the Security)
Signature Guarantee:
Signature must be guaranteed by a participant in a recognized signature guaranty
medallion program or other signature guarantor acceptable to the Trustee.
A-31
EXHIBIT B
Form Of Certificate To Be Delivered
In Connection With Transfers To IAI
-----------------------------------
Marquee Holdings Inc.
In care of
[ ]
[ ]
[ ]
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ]
principal amount at maturity of the 12% Senior Discount Notes due 2014 (the
"SECURITIES") of
Marquee Holdings Inc. (the "COMPANY").
Upon transfer, the Securities would be registered in the name of the
new beneficial owner as follows:
Name: _______________
Address: ___________
Taxpayer ID Number: ___________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended
(the "SECURITIES ACT")), purchasing for our own account or for the account of
such an institutional "accredited investor" at least $250,000 principal amount
at maturity of the Securities, and we are acquiring the Securities not with a
view to, or for offer or sale in connection with, any distribution in violation
of the Securities Act. We have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Securities, and we invest in or purchase securities similar to
the Securities in the normal course of our business. We, and any accounts for
which we are acting, are each able to bear the economic risk of our or its
investment.
2. We understand that the Securities have not been registered
under the Securities Act and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on behalf of
any investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date that is two years after the
later of the date of original issue and the last date on which the Company or
any affiliate of the Company was the owner of such Securities (or any
predecessor thereto) (the "RESALE RESTRICTION TERMINATION DATE") only (a) to the
Company, (b) pursuant to a registration
B-1
statement that has been declared effective under the Securities Act, (c) in a
transaction complying with the requirements of Rule 144A under the Securities
Act ("RULE 144A"), to a person we reasonably believe is a qualified
institutional buyer under Rule 144A (a "QIB") that is purchasing for its own
account or for the account of a QIB and to whom notice is given that the
transfer is being made in reliance on Rule 144A, (d) pursuant to offers and
sales that occur outside the United States within the meaning of Regulation S
under the Securities Act, (e) to an institutional "accredited investor" within
the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
purchasing for its own account or for the account of such an institutional
"accredited investor," in each case in a minimum principal amount at maturity of
Securities of $250,000, or (f) pursuant to any other available exemption from
the registration requirements of the Securities Act, subject in each of the
foregoing cases to any requirement of law that the disposition of our property
or the property of such investor account or accounts be at all times within our
or their control and in compliance with any applicable state securities laws.
The foregoing restrictions on resale will not apply subsequent to the Resale
Restriction Termination Date. If any resale or other transfer of the Securities
is proposed to be made pursuant to clause (e) above prior to the Resale
Restriction Termination Date, the transferor shall deliver a letter from the
transferee substantially in the form of this letter to the Company and the
Trustee, which shall provide, among other things, that the transferee is an
institutional "accredited investor" within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act and that it is acquiring such Securities for
investment purposes and not for distribution in violation of the Securities Act.
Each purchaser acknowledges that the Company and the Trustee reserve the right
prior to the offer, sale or other transfer prior to the Resale Restriction
Termination Date of the Securities pursuant to clause (d), (e) or (f) above to
require the delivery of an opinion of counsel, certifications or other
information satisfactory to the Company and the Trustee.
--------------------------------
Name:
--------------------------------
Title:
B-2
EXHIBIT C
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
-----------------------------------
HSBC Bank USA National Association
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention of: Corporate Trust
RE:
Marquee Holdings Inc. ("the Company")
12% Senior Discount Notes Due 2014 (the "Securities")
-----------------------------------------------------
Ladies and Gentlemen:
In connection with our proposed sale of $[ ] aggregate principal
amount at maturity 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 offshore securities market and neither we nor any person acting
on our behalf knows that the transaction has been prearranged 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; and
(5) we have advised the transferee of the transfer restrictions applicable
to the Securities.
You, the Company and counsel for 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,
C-1
[Name of Transferor]
By:
----------------------------
Authorized Signature
C-2
EXHIBIT D
FORM OF SUPPLEMENTAL INDENTURE TO ADD GUARANTORS
This Supplemental Indenture, dated as of [_______ __], 20__ (this
"SUPPLEMENTAL INDENTURE" or "GUARANTEE"), among [NAME OF FUTURE GUARANTOR] (the
"SUBSIDIARY GUARANTOR"), Marquee Holdings Inc. (together with its successors and
assigns, the "COMPANY"), each other then existing Guarantor under the Indenture
referred to below, and HSBC Bank USA, National Association as Trustee under the
Indenture referred to below.
W I T N E S S E T H:
WHEREAS, the Company, the Guarantors and the Trustee have heretofore
executed and delivered an Indenture, dated as of August 18, 2004 (as amended,
supplemented, waived or otherwise modified, the "INDENTURE"), providing for the
issuance of 12% Senior Discount Notes due 2014 of the Company (the
"SECURITIES");
WHEREAS, Section 4.08 of the Indenture provides that the Company is
required to cause each Subsidiary that Guarantees any Indebtedness of the
Company to execute and deliver to the Trustee a supplemental indenture pursuant
to which such Subsidiary will unconditionally Guarantee, on a joint and several
basis with the other Guarantors, the full and prompt payment of the principal
of, premium, if any, and interest on the Securities on a senior basis; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee, the
Company and the Guarantors are authorized to execute and deliver this
Supplemental Indenture to amend or supplement the Indenture, without the consent
of any Securityholder;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Subsidiary Guarantor, the Company, the other Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the Holders of the
Securities as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINED TERMS. As used in this Supplemental Indenture,
terms defined in the Indenture or in the preamble or recital hereto are used
herein as therein defined, except that the term "HOLDERS" in this Guarantee
shall refer to the term "HOLDERS" as defined in the Indenture and the Trustee
acting on behalf or for the benefit of such Holders. The words "herein,"
"hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
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ARTICLE II
AGREEMENT TO BE BOUND; GUARANTEE
SECTION 2.1 AGREEMENT TO BE BOUND. The Subsidiary Guarantor hereby
becomes a party to the Indenture as a Guarantor and as such will have all of the
rights and be subject to all of the obligations and agreements of a Guarantor
under the Indenture. The Subsidiary Guarantor agrees to be bound by all of the
provisions of the Indenture applicable to a Guarantor and to perform all of the
obligations and agreements of a Guarantor under the Indenture.
SECTION 2.2 GUARANTEE. The Subsidiary Guarantor agrees, on a joint and
several basis with all the existing Guarantors, to fully, unconditionally and
irrevocably Guarantee to each Holder of the Securities and the Trustee the
Guarantor Obligations pursuant to Article Ten of the Indenture on a senior
basis.
ARTICLE III
MISCELLANEOUS
SECTION 3.1 NOTICES. All notices and other communications to the
Subsidiary Guarantor shall be given as provided in the Indenture to the
Subsidiary Guarantor, at its address set forth below, with a copy to the Company
as provided in the Indenture for notices to the Company.
SECTION 3.2 PARTIES. Nothing expressed or mentioned herein is intended
or shall be construed to give any Person, firm or corporation, other than the
Holders and the Trustee, any legal or equitable right, remedy or claim under or
in respect of this Supplemental Indenture or the Indenture or any provision
herein or therein contained.
SECTION 3.3 GOVERNING LAW. This Supplemental Indenture shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 3.4 RATIFICATION OF INDENTURE; SUPPLEMENTAL INDENTURES PART OF
INDENTURE. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby.
SECTION 3.5 TRUSTEE NOT RESPONSIBLE. The Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this [First] Supplemental Indenture or for or in respect of the
recitals contained herein, all of which are made solely by the Company and the
Guarantors.
SECTION 3.6 COUNTERPARTS. The parties hereto may sign one or more
copies of this Supplemental Indenture in counterparts, all of which together
shall constitute one and the same agreement.
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SECTION 3.7 HEADINGS. The headings of the Articles and the Sections in
this Guarantee are for convenience of reference only and shall not be deemed to
alter or affect the meaning or interpretation of any provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first above written.
[GUARANTOR],
as a Guarantor
By:
--------------------------------
Name:
Title:
[Address]
HSBC BANK USA, NATIONAL ASSOCIATION,
as Trustee
By:
--------------------------------
Name:
Title:
MARQUEE HOLDINGS INC.
By:
--------------------------------
Name:
Title:
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EXHIBIT E
SUBSIDIARY GUARANTEE
Each of the undersigned (the "GUARANTORS") hereby jointly and
severally unconditionally guarantees, to the extent set forth in the Indenture
dated as of August 18, 2004 by and among Marquee Holdings Inc., a Delaware
corporation, as issuer (the "COMPANY") and HSBC Bank USA, National Association
as Trustee (as amended, restated or supplemented from time to time, the
"INDENTURE"), and subject to the provisions of the Indenture, (a) the due and
punctual payment of the Accreted Value of, principal of, and premium, if any,
and interest on the Securities, when and as the same shall become due and
payable, whether at maturity, by acceleration or otherwise, the due and punctual
payment of interest on overdue Accreted Value of, principal of, and premium and,
to the extent permitted by law, interest, and the due and punctual performance
of all other obligations of the Company to the Holders or the Trustee, all in
accordance with the terms set forth in Article Ten of the Indenture, and (b) in
case of any extension of time of payment or renewal of any Securities or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
The obligations of the Guarantors to the Holders and to the Trustee
pursuant to this Subsidiary Guarantee and the Indenture are expressly set forth
in Article Ten of the Indenture, and reference is hereby made to the Indenture
for the precise terms and limitations of this Subsidiary Guarantee. Each Holder
of the Security to which this Subsidiary Guarantee is endorsed, by accepting
such Security, agrees to and shall be bound by such provisions.
[Signatures on Following Pages]
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IN WITNESS WHEREOF, each of the Guarantors has caused this Subsidiary
Guarantee to be signed by a duly authorized officer.
[ ]
By:
--------------------------------
Name:
Title:
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