Annex A
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FORM OF FIRST SUPPLEMENTAL INDENTURE
WAM!NET INC.
Issuer
and
FIRST TRUST NATIONAL ASSOCIATION
Trustee
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Dated as of July , 2001
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$208,530,000
13 1/4% Senior Discount Notes due 2005
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FIRST SUPPLEMENTAL INDENTURE, dated as of July ___, 2001, between
WAM!NET Inc. and First Trust National Association, a national banking
association, as Trustee under the Indenture, dated as of March 5, 1998 (the
"Indenture"), between the Issuer and the Trustee relating to the Issuer's
$208,530,000 aggregate principal face amount of 13 1/4% Senior Discount Notes
due 2005 (the "Securities"). Capitalized terms not defined herein shall have the
respective meanings assigned to them in the Indenture.
RECITALS OF THE ISSUER
The Company has entered into a senior discounted secured debt and
equity financing arrangement. Such financing arrangement, as described in the
Consent Solicitation, dated July 20, 2001 (as amended through the date hereof)
(the "Consent Solicitation"), is defined herein as the "Cerberus Financing". As
part of the Cerberus Financing, the Issuer has completed a consent solicitation
(the "Consent Solicitation") with the holders of the Securities to amend certain
provisions of the Indenture (the "Amendments"), as described in the Consent
Solicitation.
In accordance with Section 9.02 of the Indenture the Holders of not
less than a majority in aggregate principal face amount of the Securities
Outstanding have consented to such Amendments.
The Board of Directors of the Issuer has duly authorized the execution
and delivery of this Supplemental Indenture. The Issuer has delivered to the
Trustee an Officers' Certificate pursuant to Section 9.03 of the Indenture and
an Opinion of Counsel pursuant to Section 9.03 of the Indenture.
WHEREFORE, each party agrees as follows for the benefit of the other
parties and for the equal or ratable benefit of the Holders of the Securities:
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01 Definitions.
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For all purposes of this Supplemental Indenture, except as otherwise
expressly provided or unless the context otherwise requires, the words "herein,"
"hereof" and "hereunder" and other words of similar import refer to the
Indenture and this Supplemental Indenture as a whole and not to any particular
Article, Section or subdivision. In addition, the words "this Indenture," as
used in the Indenture, shall refer to the Indenture as supplemented by this
Supplemental Indenture.
SECTION 1.02 Effect of Headings.
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The Article and Section headings are for convenience only and shall
not affect the construction hereof. Except as expressly provided herein, all
references to Sections in the Indenture shall remain unchanged.
SECTION 1.03 Successors and Assigns.
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All covenants and agreements in this Supplemental Indenture by the
Issuer shall bind their successors and assigns, or any other obligor on the
Securities, whether expressed or not.
SECTION 1.04 Separability Clause.
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In case any provision in this Supplemental Indenture 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 1.05 Benefits of Supplemental Indenture.
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Nothing in this Supplemental Indenture, express or implied, shall give
to any Person, other than the parties hereto and their successors hereunder, any
Paying Agent and the Holders, any benefit or any legal or equitable right,
remedy or claim under this Supplemental Indenture.
SECTION 1.06 Governing Law.
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THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO THE
CONFLICT OF LAWS PRINCIPLES THEREOF).
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SECTION 1.07 Effectiveness.
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This Supplemental Indenture shall take effect on the date hereof;
provided, however, that the Amendments set forth in Article II hereof shall
become operative only upon and simultaneously with, and shall have no force and
effect prior to the date of delivery by the Issuer of an Officers' Certificate
to the effect that the Cerberus Financing has been consummated.
ARTICLE II
AMENDMENTS
Section 1.01. Definitions.
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(a) The second sentence of the definition of "Asset Sale" is hereby
amended and restated in its entirety as follows:
For the purposes of this definition, the term "Asset Sale" shall not
include (i) any disposition of properties and assets of the Company that is
governed under Article Eight, (ii) sales of property or equipment that have
become worn out, obsolete or damaged or otherwise unsuitable for use in
connection with the business of the Company or any Restricted Subsidiary, as the
case may be, (iii) any issuance of securities by an Unrestricted Subsidiary, and
(iv) for purposes of Section 10.15 hereof, sales, conveyances, transfers, leases
or other dispositions of property or assets, whether in one transaction or a
series of related transactions occurring within one year, either (x) involving
assets with a Fair Market Value not in excess of $1 million in any 12 month
period, or (y) which constitutes the incurrence of a Capitalized Lease
Obligation.
(b) The second sentence of the definition of "Indebtedness" is hereby
amended and restated in its entirety as follow:
In no event shall "Indebtedness" include (a) trade payables and
accrued liabilities that are current liabilities incurred in the ordinary course
of business, excluding the current maturity of any obligation which would
otherwise constitute Indebtedness or (b) any amount, liability or obligation due
to CCPRE-XXXX, LLC ("CCPRE") by the Company under the Net Lease between CCPRE
and the Company, dated as of September 30, 1999 (the "Net Lease").
(c) Section 1.01 is hereby amended by adding the following definition
of "Cerberus" immediately following the definition of "Cedel":
"Cerberus" means Cerberus Capital Management, L.P., and its
designees and affiliates.
(d) The definition of "Permitted Credit Facility" is hereby amended
and restated in its entirety as follows:
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"Permitted Credit Facility" means any senior secured or
unsecured term loan and/or revolving credit facility (including any
letter of credit subfacility) entered into principally with commercial
banks, financial institutions and/or any other person.
(e) The definition of "Permitted Holders" is hereby amended and
restated in its entirety as follows:
"Permitted Holders" means (i) WorldCom and each of its
Affiliates, (ii) Cerberus and each of its Affiliates and (iii) Xxxxxx
X. Xxxxxxxx III (the Chairman of the Board and Chief Executive Officer
of the Company as of the date of this Indenture) and his family
members, any trust for the benefit of any of the foregoing persons and
their respective estates and heirs. As used herein, "family member"
means the spouse, siblings and lineal descendants of Xx. Xxxxxxxx.
(f) Clause (h) of the definition of "Permitted Indebtedness" is hereby
amended and restated in its entirety as follows:
(h) Indebtedness of the Company and/or any of its
Subsidiaries incurred under one or more Permitted Credit Facilities
and/or Indebtedness of the Company and/or any of its Subsidiaries
represented by Debt Securities, and any refinancings of the foregoing
otherwise incurred in compliance with this Indenture, in an aggregate
principal amount not to exceed $250 million at any time outstanding
(without regard to interest whether accrued, capitalized, accreted or
otherwise) and any Guarantees thereof;
(g) The definition of "Permitted Investments" is hereby amended
by adding the following Clause (h) immediately following Clause (g):
(h) any Investment by the Company or any Restricted
Subsidiary in WGSI in an amount not to exceed $75 million in the
aggregate at any one time.
(h) Clause (h) of the definition of "Permitted Liens" is hereby
amended and restated in its entirety to read as follows:
(h) Liens securing Indebtedness incurred under a Permitted
Credit Facility, provided that (I) such Indebtedness is Permitted
Indebtedness and (II) such Liens attach within 180 days of the date on
which such Permitted Credit Facility is established,
(i) The definition of "Permitted Liens" is hereby amended by
adding the following Clause (m) immediately following Clause (l):
;and (m) Liens securing any Indebtedness incurred pursuant
to the Winstar Settlement, as such term is defined in the Solicitation
of Consents, dated July 20, 2001, shall be deemed Permitted Liens.
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(j) Section 1.01 is hereby amended by adding the following
definition of "WGSI" immediately following the definition of "Warrant Change of
Control":
"WGSI" means Wam!Net Government Services, Inc., a Minnesota
corporation, its successors, assigns (including by operation of law),
entities succeeding to all of its assets and liabilities, and its
subsidiaries.
Section 10.13. Limitation on Restricted Payments.
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Clause (vi) of the third paragraph of Section 10.13 is hereby amended
and restated in its entirety as follows:
(vi) so long as no Default shall have occurred and be
continuing, Investments in (x) joint ventures formed to engage in the
Digital Network Business and (y) other persons principally engaged in
the Digital Network Business; provided that no more than $25.0 million
of Investments made pursuant to this clause (vi) shall be outstanding
at any time; and
Section 10.14. Limitation on Transaction with Affiliates.
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The first paragraph of Section 10.14 is hereby amended and restated in
its entirety as follows:
The Company shall not, and shall not permit, cause or suffer
any Restricted Subsidiary to, directly or indirectly, conduct any
business, sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or
enter into any contract, agreement, loan, advance or Guarantee or
engage in any other transaction (or series of related transactions
which are similar or part of a common plan) with or for the benefit of
any of, their respective Affiliates or any beneficial owner of 10% or
more of the Common Stock of the Company or any officer or director of
the Company or any Subsidiary (each, an "Affiliate Transaction"),
unless the terms of the Affiliate Transaction are set forth in writing
and are no less favorable to the Company or such Restricted
Subsidiary, as the case may be, than would be available in a
comparable transaction with an unaffiliated third party. Each
Affiliate Transaction (or series of related Affiliate Transactions)
involving aggregate payments and/or other consideration having Fair
Market Value (i) in excess of $1 million shall be approved by a
majority of the Board, such approval to be evidenced by a Board
Resolution stating that the Board has determined that such transaction
or transactions comply with the foregoing provisions, (ii) in excess
of $5 million shall further require the approval of a majority of the
Disinterested Directors and (iii) in excess of $10 million shall
require that the Company obtain a written opinion from an Independent
Financial Advisor stating that the terms of such Affiliate Transaction
(or series of related Affiliate Transactions) to the Company or the
Restricted Subsidiary, as the case may be, are fair from a financial
point of view; provided, however, that the dollar thresholds set forth
in clauses (i), (ii) and (iii) above shall be increased to $2.5
million, $10 million and
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$25 million, respectively, in the case of any Affiliate Transaction
with WorldCom, Cerberus or any of their respective Affiliates further,
provided, however, that for the purposes of this Section 10.14,
Cerberus and its Affiliates shall be exempt from the requirement to
obtain the written opinion of an Independent Financial Advisor with
respect to the fairness of an Affiliate Transaction. For purposes of
this Section 10.14, any Affiliate Transaction approved by a majority
of the Disinterested Directors or as to which a written opinion has
been obtained from an Independent Financial Advisor, on the basis set
forth in the preceding sentence, shall be deemed to be on terms that
are no less favorable to the Company or such Restricted Subsidiary, as
the case may be, than would be available in a comparable transaction
with an unaffiliated third party and, therefore, shall be permitted
under this Section 10.14.
Section 10.15. Disposition of Proceeds of Asset Sales.
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The first sentence of Section 10.15 is hereby amended and restated in
its entirety to read as follows:
The Company will not, and will not permit any Restricted
Subsidiary to, make any Asset Sale unless (a) the Company or such
Restricted Subsidiary, as the case may be, receives consideration at
the time of such Asset Sale at least equal to the Fair Market Value of
the shares or assets sold or otherwise disposed of and (b) at least
80% of such consideration consists of Cash or Cash Equivalents;
provided that the following shall be treated as Cash or Cash
Equivalents for the purposes of this Section 10.15: (x) the amount of
Indebtedness (other than Subordinated Indebtedness and Deeply
Subordinated Indebtedness) of the Company or any Restricted Subsidiary
that is assumed by the transferee of assets disposed of in such Asset
Sale pursuant to an agreement that fully and unconditionally releases
the Company or such Restricted Subsidiary from further liability
("Assumed Indebtedness"), (y) the amount of any notes or other
obligations that within 30 days of receipt are converted into cash (to
the extent of the cash (after payment of any costs of disposition) so
received), and (z) the exercise of any warrant or option issued by the
Company or any Subsidiary where the exercise price is paid (i) by
cancellation of all or any part of the unpaid principal amount of any
then-outstanding Indebtedness owed to such warrant or option holder by
the Company or its Subsidiary in an amount equal to the exercise
price, (ii) by cancellation of such number of the shares of common
stock of the Company or its Subsidiary otherwise issuable to the
warrant or option holder upon such exercise as shall be specified for
cancellation by the warrant or option holder, such that the excess of
the aggregate current market price of such specified number of shares
on the date of exercise over the portion of the exercise price
attributable to such shares shall equal the exercise price
attributable to the shares of common stock to be issued upon such
exercise, or (iii) by surrender to the Company or its Subsidiary for
cancellation certificates representing shares of common stock of the
Company or its Subsidiary owned by the warrant or option holder
(properly endorsed for transfer in blank) having a current market
price on the date of exercise equal to the exercise price thereunder.
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Section 10.20. Limitation on Designations of Unrestricted Subsidiaries.
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The first and second paragraphs of Section 10.22 are hereby amended
and restated in their entirety as follows:
Other than in the case of a Permitted Designation (as defined below)
the Company will not designate any Subsidiary of the Company (other than a newly
created Subsidiary in which the Company has made an Investment of $1,000 or
less) as an "Unrestricted Subsidiary" under this Indenture (a "Designation")
unless:
(a) no Default shall have occurred and be continuing at the
time of or after giving effect to such Designation;
(b) except in the case of Permitted Investments and
Investments made pursuant to clause (v) of the third paragraph of
Section 10.13 hereof, at the time of and after giving effect to such
Designation, the Company would be able to incur $1.00 of Indebtedness
(other than Permitted Indebtedness) under Section 10.11 hereof; and
(c) the Company would be permitted under this
Indenture to make an Investment at the time of such Designation
(assuming the effectiveness of such Designation) in an amount (the
"Designation Amount") equal to the Fair Market Value of the interest
of the Company and its Restricted Subsidiaries in such Subsidiary on
such date.
In the event of any such Designation, other than in the case of a
Permitted Designation, the Company shall be deemed to have made an Investment
constituting a Restricted Payment pursuant to Section 10.13 hereof for all
purposes of this Indenture in an amount equal to the Designation Amount. Neither
the Company nor any Restricted Subsidiary shall at any time (x) provide a
Guarantee of, or similar credit support for, or subject any of its properties or
assets (other than the Capital Stock of any Unrestricted Subsidiary) to the
satisfaction of, any Indebtedness of any Unrestricted Subsidiary (including any
undertaking, agreement or instrument evidencing such Indebtedness), (y) be
directly or indirectly liable for any Indebtedness of any Unrestricted
Subsidiary or (z) be directly or indirectly liable for any other Indebtedness
which provides that the holder thereof may (upon notice, lapse of time or both)
declare a default thereon (or cause the payment thereof to be accelerated or
payable prior to its final scheduled maturity) upon the occurrence of a default
with respect to any other Indebtedness that is Indebtedness of an Unrestricted
Subsidiary (including any corresponding right to take enforcement action against
such Unrestricted Subsidiary), except under a Permitted Credit Facility or to
the extent otherwise permitted under this Indenture, including without
limitation under Section 10.13 hereof. The designation of WGSI as an
Unrestricted Subsidiary (the "Permitted Designation") shall not be affected by
the conversion of WGSI into a limited liability company or the merger of or
other reorganization of WGSI that results in WGSI being a limited liability
company.
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Section 10.22. Issuance of Guarantees by Material Restricted Subsidiaries;
Limitations on Guarantees by Other Restricted Subsidiaries.
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The second paragraph of Section 10.22 is hereby amended and restated
in its entirety to read as follows:
The Company will not permit any Restricted Subsidiary that
is not a Subsidiary Guarantor, directly or indirectly, to Guarantee
any Indebtedness of any person (other than Indebtedness of the Company
or any Subsidiary incurred under a Permitted Credit Facility) unless,
in each case, such Restricted Subsidiary simultaneously executes and
delivers to the Trustee a supplemental indenture, in the form of
Exhibit F hereto, pursuant to which such Restricted Subsidiary shall
guarantee the full and punctual payment of all Indenture Obligations
of the Company on the same terms and conditions as the Subsidiary
Guarantees by the Subsidiary Guarantors.
This Supplemental Indenture is executed by the Issuer and the Trustee
pursuant to the provisions of Article IX of the Indenture, and the terms and
conditions hereof shall be, and shall from and after the date hereof be deemed
to be, part of the terms and conditions of the Indenture for any and all
purposes, subject to Section 1.7 hereof. The Indenture as amended by this
Supplemental Indenture is in all respects confirmed and preserved.
This Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one in the same instrument.
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SIGNATURE
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first written above.
WAM!NET INC.
By:
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Name:
Title:
Attest:
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FIRST TRUST NATIONAL ASSOCIATION,
Trustee
By:
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Name:
Title: Trust Officer
Attest:
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CONSENT FORM
WAM!NET INC.
The undersigned holder of record on July 16, 2001 of 13 1/4% Senior
Discount Notes due 2005 (the "Notes") of WAM!NET INC. (collectively, the
"Issuer"), hereby
Consents [ ] Does Not Consent [ ]
to the Indenture Amendments (as defined in the Solicitation of Consents dated
July 20, 2001 of the Issuer). The undersigned acknowledges receipt for the
Solicitation of Consents (including the supplemental material thereto) and to
the Waiver described in the Solicitation of Consents.
Unless otherwise specified by the undersigned, this form relates to
the total principal face amount of Notes held by the undersigned on the date
hereof as indicated below.
Principal Face Amount Held:
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Principal Face Amount Consenting:
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If forms of Consent are signed by trustees, executors, administrators,
guardians, attorneys-in-fact, officers of corporations or other persons acting
in a fiduciary or representative capacity, such persons should so indicate when
signing.
Name of Signer (Please Print)
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Telephone No. of Signer: (___)
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Date:
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Signature
