EXHIBIT 4.2
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CINEMARK USA, INC.
9-5/8% SENIOR SUBORDINATED NOTES DUE 2008
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INDENTURE
Dated as of August 15, 1996
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U.S. TRUST COMPANY OF TEXAS, N.A.
as Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
--------------- -----------------
310 (a) (1)................................................................................................7.10
(a) (2)................................................................................................7.10
(a) (3)................................................................................................N.A.
(a) (4)................................................................................................N.A.
(a) (5)................................................................................................7.10
(b)...............................................................................................7.3, 7.10
(c)....................................................................................................N.A.
311 (a)....................................................................................................7.11
(b)....................................................................................................7.11
(c)....................................................................................................N.A.
312 (a).....................................................................................................2.5
(b)....................................................................................................11.3
(c)....................................................................................................11.3
313 (a).....................................................................................................7.6
(b) (1)................................................................................................N.A.
(b) (2)............................................................................................7.6, 7.7
(c)...............................................................................................7.6, 11.2
(d).....................................................................................................7.6
314 (a)...............................................................................................4.3, 11.5
(b)....................................................................................................N.A.
(c) (1)................................................................................................11.4
(c) (2)................................................................................................11.4
(c) (3)................................................................................................N.A.
(d)....................................................................................................N.A.
(e)....................................................................................................11.5
(f)....................................................................................................N.A.
315 (a).................................................................................................7.1 (b)
(b)...............................................................................................7.5, 11.2
(c).................................................................................................7.1 (a)
(d).................................................................................................7.1 (c)
(e)....................................................................................................6.11
316 (a) (last sentence).....................................................................................2.9
(a) (1) (A).............................................................................................6.5
(a) (1) (B).............................................................................................6.4
(a) (2)................................................................................................N.A.
(b).....................................................................................................6.7
(c).....................................................................................................9.4
317 (a) (1).................................................................................................6.8
(a) (2).................................................................................................6.9
(b).....................................................................................................2.4
Trust Indenture
Act Section Indenture Section
--------------- -----------------
318 (a)....................................................................................................11.1
(b)....................................................................................................N.A.
(c)....................................................................................................11.1
N.A. means not applicable.
*This Cross-Reference Table is not part of the
Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE..............................................................1
Section 1.1. Definitions..................................................................................1
Section 1.2. Other Definitions...........................................................................16
Section 1.3. Incorporation by Reference of Trust Indenture Act...........................................17
Section 1.4. Section 1.4. Rules of Construction..........................................................17
ARTICLE 2 THE NOTES..............................................................................................18
Section 2.1. Form and Dating.............................................................................18
Section 2.2. Execution and Authentication................................................................20
Section 2.3. Trustee, Registrar and Paying Agent.........................................................20
Section 2.4. Paying Agent to Hold Money in Trust.........................................................21
Section 2.5. Holder Lists................................................................................21
Section 2.6. Transfer and Exchange.......................................................................21
Section 2.7. Replacement Notes...........................................................................28
Section 2.8. Outstanding Notes...........................................................................29
Section 2.9. Treasury Notes..............................................................................29
Section 2.10. Temporary Notes.............................................................................29
Section 2.11. Cancellation................................................................................30
Section 2.12. Defaulted Interest..........................................................................30
Section 2.13. Persons Deemed Owners.......................................................................30
Section 2.14. CUSIP Numbers...............................................................................30
ARTICLE 3 REDEMPTION AND PREPAYMENT..............................................................................31
Section 3.1. Notices to Trustee..........................................................................31
Section 3.2. Section 3.2. Selection of Notes to Be Redeemed..............................................31
Section 3.3. Notice of Redemption........................................................................31
Section 3.4. Effect of Notice of Redemption..............................................................32
Section 3.5. Deposit of Redemption Price.................................................................32
Section 3.6. Notes Redeemed in Part......................................................................33
Section 3.7. Optional Redemption.........................................................................33
Section 3.8. Mandatory Redemption........................................................................34
ARTICLE 4 COVENANTS..............................................................................................34
Section 4.1. Payment of Notes............................................................................34
Section 4.2. Maintenance of Office or Agency.............................................................34
Section 4.3. Provisions of Reports and Other Information.................................................35
Section 4.4. Compliance Certificate......................................................................35
Section 4.5. Taxes.......................................................................................36
Section 4.6. Stay, Extension and Usury Laws..............................................................36
Section 4.7. Limitation on Restricted Payments...........................................................36
Section 4.8. Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.....39
Section 4.9. Limitation on Indebtedness..................................................................40
Section 4.10. Limitation on Asset Sales...................................................................42
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Section 4.11. Limitation on Transactions with Affiliates..................................................44
Section 4.12. Limitation on Liens.........................................................................45
Section 4.13. Limitation on Layering Debt.................................................................48
Section 4.14. Offer to Repurchase Upon Change of Control..................................................48
Section 4.15. Corporate Existence.........................................................................49
Section 4.16. Covenant with Respect to Cinemark International and its Subsidiaries........................50
ARTICLE 5 SUCCESSORS.............................................................................................50
Section 5.1. Merger, Consolidation, or Sale of Assets....................................................50
Section 5.2. Successor Company Substituted...............................................................51
ARTICLE 6 DEFAULTS AND REMEDIES..................................................................................51
Section 6.1. Events of Default...........................................................................51
Section 6.2. Acceleration................................................................................52
Section 6.3. Other Remedies..............................................................................53
Section 6.4. Waiver of Past Defaults.....................................................................53
Section 6.5. Control by Majority.........................................................................53
Section 6.6. Limitation on Suits.........................................................................53
Section 6.7. Rights of Holders of Notes to Receive Payment...............................................54
Section 6.8. Collection Suit by Trustee..................................................................54
Section 6.9. Trustee May File Proofs of Claim............................................................54
Section 6.10. Priorities..................................................................................55
Section 6.11. Undertaking for Costs.......................................................................55
ARTICLE 7 TRUSTEE................................................................................................55
Section 7.1. Duties of Trustee...........................................................................55
Section 7.2. Rights of Trustee...........................................................................57
Section 7.3. Individual Rights of Trustee................................................................57
Section 7.4. Trustee's Disclaimer........................................................................58
Section 7.5. Notice of Defaults..........................................................................58
Section 7.6. Reports by Trustee to Holders of the Notes..................................................58
Section 7.7. Compensation and Indemnity..................................................................58
Section 7.8. Replacement of Trustee......................................................................59
Section 7.9. Successor Trustee by Merger, etc............................................................60
Section 7.10. Eligibility; Disqualification...............................................................60
Section 7.11. Preferential Collection of Claims Against Company...........................................61
ARTICLE 8 DEFEASANCE AND DISCHARGE...............................................................................61
Section 8.1. Option to Effect Legal Defeasance or Covenant Defeasance....................................61
Section 8.2. Legal Defeasance............................................................................61
Section 8.3. Covenant Defeasance.........................................................................61
Section 8.4. Conditions to Legal or Covenant Defeasance..................................................62
Section 8.5. Discharge...................................................................................63
Section 8.6. Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions..................................................................................64
Section 8.7. Repayment to Company........................................................................64
Section 8.8. Reinstatement...............................................................................65
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ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER.......................................................................65
Section 9.1. Without Consent of Holders of Notes.........................................................65
Section 9.2. With Consent of Holders of Notes............................................................65
Section 9.3. Compliance with Trust
Indenture Act.........................................................67
Section 9.4. Revocation and Effect of Consents...........................................................67
Section 9.5. Notation on or Exchange of Notes............................................................68
Section 9.6. Trustee to Sign Amendments, etc.............................................................68
Section 9.7. Payments for Consent........................................................................68
ARTICLE 10 SUBORDINATION.........................................................................................68
Section 10.1. Agreement to Subordinate....................................................................68
Section 10.2. Liquidation; Dissolution; Bankruptcy........................................................68
Section 10.3. Default on Designated Senior Indebtedness...................................................69
Section 10.4. Acceleration of Notes.......................................................................70
Section 10.5. When Distribution Must Be Paid Over.........................................................70
Section 10.6. Notice by the Company.......................................................................70
Section 10.7. Subrogation.................................................................................70
Section 10.8. Relative Rights.............................................................................71
Section 10.9. Subordination May Not Be Impaired by the Company............................................71
Section 10.10. Distribution or Notice to Representative....................................................71
Section 10.11. Rights of Trustee and Paying Agent..........................................................71
Section 10.12. Authorization to Effect Subordination.......................................................72
ARTICLE 11 MISCELLANEOUS.........................................................................................72
Section 11.1. Trust
Indenture Act Controls................................................................72
Section 11.2. Notices.....................................................................................72
Section 11.3. Communication by Holders of Notes with Other Holders of Notes...............................74
Section 11.4. Certificate and Opinion as to Conditions Precedent..........................................74
Section 11.5. Statements Required in Certificate or Opinion...............................................74
Section 11.6. Rules by Trustee and Agents.................................................................75
Section 11.7. No Personal Liability of Directors, Officers, Employees and Others..........................75
Section 11.8. Governing Law...............................................................................75
Section 11.9. No Adverse Interpretation of Other Agreements...............................................75
Section 11.10. Successors..................................................................................75
Section 11.11. Severability................................................................................75
Section 11.12. Originals...................................................................................75
Section 11.13. Table of Contents, Headings, etc............................................................76
Section 11.14. Counterparts................................................................................76
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EXHIBITS
Exhibit A FORM OP NOTE.................................................................................A-1
Exhibit B CERTIFICATE OF TRANSFEROR....................................................................B-1
iv
This
INDENTURE, dated as of August 15, 1996, is by and between Cinemark
USA, Inc., a Texas corporation (the "Company"), and U.S. Trust Company of Texas,
N.A., as trustee (the "Trustee").
The parties listed above agree as follows for the benefit of each other
and for the equal and ratable benefit of the Holders of the 9-5/8% Senior
Subordinated Notes due 2008, Series A (the "Series A Notes") and the 9-5/8%
Senior Subordinated Notes due 2008, Series B (the "Series B Notes" and, together
with the Series A Notes, the "Notes").
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.1. Definitions.
"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.
"Affiliate" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar or Paying Agent.
"Applicable Law", except as the context may otherwise require,
means all applicable laws, rules, regulations, ordinances, judgments, decrees,
injunctions, writs and orders of any court or governmental or congressional
agency or authority and rules, regulations, orders, licenses and permits of any
United States federal, state, municipal, regional, or other governmental body,
instrumentality, agency or authority.
"Asset Disposition" means any sale, lease, conveyance,
transfer or other disposition (or series of related sales, leases, conveyances,
transfers or dispositions) of any Capital Stock of a Restricted Subsidiary of
the Company (whether or not upon issuance), or of any Capital Stock of Cinemark
International by the Company (but not the issuance and sale of Capital Stock by
Cinemark International), or of any other property or other assets (each referred
to for the purposes of this definition as a "disposition") by the Company or any
of its Restricted Subsidiaries, whether for cash or other consideration, other
than (i) a disposition by a Restricted Subsidiary of the Company to the Company
or a Wholly owned Subsidiary of the Company that is a Restricted Subsidiary,
(ii) a disposition by the Company to a Wholly Owned Subsidiary of
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the Company that is a Restricted Subsidiary, (iii) a disposition that is a
Permitted Investment or a Restricted Payment not prohibited by Section 4.7 (to
the extent such Permitted Investment or Restricted Payment may be deemed to
constitute an Asset Disposition), (iv) dispositions of inventory in the ordinary
course of business, (v) a disposition pursuant to section 5.1, (vi) exchanges of
theatre properties that comply with the requirements described in Section
4.10(f), provided that payment of any Other Consideration shall, to the extent
provided therein, be treated as an Asset Disposition, (vii) a designation of a
Restricted Subsidiary as an Unrestricted Subsidiary, if the Company elects to
treat such designation as an Investment and not as an Asset Disposition, or
(viii) a disposition of Capital Stock, property or assets in a single
transaction or a series of related transactions (other than dispositions of the
type described in clauses (i) through (vii) above) having a Fair Market Value of
less than $2 million. For purposes of this definition, "Fair Market Value" of
any Capital stock, property or other assets means the fair market value of such
Capital Stock, property or other assets at the time of disposition, which in the
case of any disposition or series of related dispositions having an aggregate
fair market value of $2 million or more shall be determined in good faith
(taking into account, without limitation, any assumption of indebtedness in
connection with such disposition) by resolution of the Board of Directors.
Notwithstanding any provision of this Indenture to the contrary, the expiration
or non-renewal of any lease of theatre properties or equipment at the normal
expiration date thereof without payment to the Company or any of its Restricted
Subsidiaries of consideration therefor shall not constitute an Asset
Disposition.
"Asset Disposition Expenses" shall have the meaning assigned
to such term in the definition of the term "Net Proceeds."
"Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, as may be
amended from time to time, or any similar federal or state law for the relief of
debtors.
"Board of Directors" means the Board of Directors of the
Company, or any authorized committee of the Board of Directors.
"Business Day" means any day other than a Saturday, Sunday,
public holiday or day on which banking institutions in
New York (or, with
respect to any payments or transfers to be made by the Trustee or any Agent, as
applicable, in the city where such Trustee or Agent is located) are authorized
or obligated by law or executive order to close.
"Capitalized Lease obligations" means the capitalized amount
of the rental obligations of any Person under any lease of any property (whether
real, personal or mixed) which, in accordance with GAAP, is required to be
capitalized on the balance sheet of such Person.
"Capital Stock" of any Person means (i) any and all shares,
interests, participations or other equivalents (however designated) of such
Person's capital stock and any warrants, options and similar rights to acquire
such capital stock, (ii) in the case of a partnership, partnership interests
(whether general or limited) and (iii) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
2
"Cash" means money or currency or a credit balance in a
Deposit Account.
"Cash Equivalents" means (i) direct obligations of the United
States of America or any agency thereof having maturities of not more than one
year from the date of acquisition, (ii) time deposits and certificates of
deposit of any domestic commercial bank of recognized standing having capital
and surplus in excess of $500 million, with maturities of not more than one year
from the date of acquisition, (iii) repurchase obligations issued by any bank
described in clause (ii) above with a term not to exceed 30 days; (iv)
commercial paper rated at least A-1 or the equivalent thereof by S&P or at least
P-1 or the equivalent thereof by Moody's, in each case maturing within one year
after the date of acquisition and (v) shares of any money market mutual fund, or
similar fund, in each case having assets in excess of $500 million, which
invests predominantly in investments of the types described in clauses (i)
through (iv) above.
"Change of Control" means (i) the acquisition, including
through merger, consolidation or otherwise, by any Person or any Persons acting
together which would constitute a "group" (a "Group") for purposes of Section
13(d) of the Exchange Act, together with all affiliates and associates (as
defined in Rule 12b-2 under the Exchange Act) thereof, of direct or indirect
beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of more
than 50% of (A) the outstanding shares of Common Stock of the Company or (B) the
total voting power of all classes of Capital Stock of the Company entitled to
vote generally in the election of directors, or (ii) the election by any Person
or Group, together with all affiliates and associates thereof, of a sufficient
number of its or their nominees to the Board of Directors such that such
nominees, when added to any existing directors remaining on such Board of
Directors after such election who are affiliates or associates of such Person or
Group, shall constitute a majority of such Board of Directors; provided,
however, that, for purposes of this definition, the terms "Person" and "Group"
shall be deemed not to include (i) the Company, (ii) any Restricted Subsidiary
of the Company that is a Wholly Owned Subsidiary, (iii) Xxx Xxx Xxxxxxxx or
Xxxxx Xxxxxxxx, or any descendant of Xxx Xxx Xxxxxxxx or the spouse of any such
descendant, the estate of Xxx Xxx Xxxxxxxx, Xxxxx Xxxxxxxx, any descendant of
Xxx Xxx Xxxxxxxx or the spouse of any such descendant or any trust or other
arrangement for the benefit of Xxx Xxx Xxxxxxxx, Xxxxx Xxxxxxxx, any descendant
of Xxx Xxx Xxxxxxxx or the spouse of any such descendant (collectively, the
"Xxxxxxxx Family"), (iv) any group which includes any member or members of the
Xxxxxxxx Family if a majority of the Capital Stock of the Company held by such
group is beneficially owned (including the power to vote such Capital Stock of
the Company) by such member or members or by one or more affiliates at least 80%
of the equity interests of which are owned by such member or members or (v)
Cypress Merchant Banking Partners L.P. or Cypress Pictures Ltd.; and provided,
further, that, the term "Change of Control" shall be deemed not to include any
transaction or series of transactions that results in the Capital Stock of the
Company being held by one or more Persons if the beneficial ownership, direct or
indirect, of the Company after such transaction or series of transactions is
substantially the same as the beneficial ownership, direct or indirect, of the
Company prior to such transaction or series of transactions.
"Cinemark International" means Cinemark International, Inc., a
Texas corporation.
"Cinemark International Management Agreement" means the
Management Agreement, dated as of June 10, 1992, between the Company and
Cinemark International, as
3
such agreement may be amended, supplemented or otherwise modified from time to
time in accordance with the terms hereof and thereof.
"Commission" or "SEC" means the Securities and Exchange
Commission, and any successor thereto.
"Common Stock" of any Person means Capital Stock of such
Person that does not rank prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.
"Consolidated EBITDA" of any Person means, for any period
(without duplication), (i) the sum of (A) Consolidated Net Income, (B)
Consolidated Interest Expense, (C) provisions for taxes based on or calculated
with respect to income, (D) depreciation expense, (E) amortization expense, and
(F) all other non-cash items reducing Consolidated Net Income, less all non-cash
items increasing Consolidated Net Income, minus (ii) any decrease in deferred
lease expenses, all as determined on a consolidated basis for such Person and
its Restricted Subsidiaries in accordance with GAAP.
"Consolidated Interest Expense" of any Person means, for any
period, without duplication, the total interest expense of such Person and its
Restricted Subsidiaries determined on a consolidated basis in accordance with
GAAP, including (i) non-cash, payable-in-kind interest, (ii) interest expense
attributable to capital leases, (iii) amortization of debt discount and debt
issue cost (excluding related legal and accounting fees), but only with respect
to transactions consummated after the Initial Issuance Date, (iv) commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing, (v) net costs under Hedging Obligations
(including amortizations of discount), (vi) preferred stock dividends in respect
of preferred stock of Restricted Subsidiaries of such Person, other than
payable-in-kind dividends in respect of preferred stock that is not Disqualified
Stock, held by Persons other than such Person or one of its Wholly Owned
Subsidiaries that is a Restricted Subsidiary, and (vii) dividends in respect of
Disqualified Stock of such Person.
"Consolidated Net Income" of any Person means, for any period,
the aggregate of the Net Income of such Person and its Restricted subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP,
however, including, in the case of the Company and its Restricted Subsidiaries,
only those management fees actually received by the Company from its
Unrestricted Subsidiaries, and excluding amortization of debt discount and debt
issue costs with respect to transactions consummated on or prior to the Initial
Issuance Date, provided that (i) accrued but unpaid compensation expenses
related to any stock appreciation or stock option plans shall not be deducted
until such time as such expenses result in a cash expenditure, (ii) compensation
expenses related to tax payment plans implemented by the Company from time to
time in connection with the exercise and/or repurchase of stock options shall
not be deducted from Net Income to the extent of the related tax benefits
arising therefrom, (iii) the Net Income of any Person that is not a Restricted
Subsidiary of such Person or that is accounted for by such Person by the equity
method of accounting shall not be included in such Consolidated Net Income,
except that the Company's equity in the Net Income of any such Person for any
such period or any previous period shall be so included only up to the aggregate
amount of cash
4
dividends or distributions paid to the Company or one of its Restricted
Subsidiaries, and (iv) the Net Income (if positive) of any Person acquired in a
pooling of interests transaction for any period prior to the date of such
acquisition shall be excluded. For purposes of this definition, "Net Income" of
any Person means, for any period, the net income (or loss) of such Person
determined in accordance with GAAP, excluding, however, from the determination
(i) any extraordinary loss resulting from early extinguishment of debt on or
prior to the Initial Issuance Date, (ii) any net gain or loss from any
extraordinary item (net of all related taxes, fees, costs and expenses), (iii)
any net gain or loss (net of all related taxes and Asset Disposition Expenses)
realized upon the sale or other disposition during such period (including
without limitation dispositions pursuant to sale and leaseback transactions) of
any real property, equipment or other asset of such Person, which is not sold or
otherwise disposed of in the ordinary course of business, or of any Capital
Stock of such Person or a Restricted Subsidiary of such Person, and (iv) the
cumulative effect of changes in accounting principles.
"Consolidated Net Worth" of any Person means, as of any date,
the amount which, in accordance with GAAP, would be set forth under the caption
"Shareholders' Equity" (or any like caption) on a consolidated balance sheet of
such Person and its Restricted Subsidiaries, less amounts attributable to
Disqualified Stock of such Person or any of its Restricted Subsidiaries.
"Consolidated Tangible Assets" of any Person means, as of any
date, the amount which, in accordance with GAAP, would be set forth under the
caption "Total Assets" (or any like caption) on a consolidated balance sheet of
such Person and its Restricted Subsidiaries, less all intangible assets,
including, without limitation, goodwill, organization costs, patents,
trademarks, copyrights, franchises, and research and development costs.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 11.2 hereof or such other address as
to which the Trustee may give notice to the Company.
"Credit Facility" means that certain Credit Agreement, dated
as of February 14, 1996, among the Company, the financial institutions from time
to time parties thereto, and Bank of America National Trust and Savings
Association, as agent for such financial institutions, and the various ancillary
documents provided for therein, as the same may be amended, extended, increased,
renewed, restated, supplemented or otherwise modified (in whole or in part, and
without limitation as to amount, terms, conditions, covenants and other
provisions) from time to time, and any agreement or agreements governing
Indebtedness incurred to refinance, replace, restructure or refund such
agreements in whole or in part from time to time (whether with the original
agent and lenders or other agents and lenders or otherwise, and whether provided
for under the original Credit Facility or otherwise).
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator, custodian or similar official under any Bankruptcy Law.
"Default" means any event, act or condition which is, or after
notice or passage of time or both would be, an Event of Default.
5
"Definitive Notes" means Notes that are in the form of the
Notes attached hereto as Exhibit A that do not include the paragraph called for
by footnote 1 or the schedule called for by footnote 3 thereof.
"Deposit Account" means a demand, savings, passbook, money
market or like account with a commercial bank, savings and loan association or
like organization or a government securities dealer, other than an account
evidenced by a negotiable certificate of deposit.
"Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.3
hereof as the Depositary with respect to the Notes, until a successor shall have
been appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"Designated Senior Indebtedness" means (i) the Credit Facility
and all Indebtedness thereunder and (ii) any other Senior Indebtedness issued
after the Initial Issuance Date and permitted under the terms of this Indenture,
the principal amount of which is $10 million or more and that has been
designated by the Company as Designated Senior Indebtedness.
"Disqualified Stock" of any Person means any Capital Stock of
such Person that, by its terms (or by the terms of any security into which it is
convertible or for which it is exercisable, redeemable or exchangeable),
matures, or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, or is redeemable at the option of the holder thereof, in whole or in
part (but only to the extent of such part), on or prior to the Stated Maturity
of the Notes.
"EBITDA Ratio" of any Person means the ratio of (i) the
aggregate amount of Consolidated EBITDA of such Person for the four full fiscal
quarters immediately prior to the date of the transaction giving rise to the
need to calculate the EBITDA Ratio (the "Determination Date") to (ii) the
aggregate Consolidated Interest Expense which such Person shall accrue during
the fiscal quarter in which the Determination Date occurs and the three fiscal
quarters immediately subsequent to such fiscal quarter, assuming that the
Consolidated Interest Expense shall accrue on the amount of such Person's
Indebtedness on the Determination Date, including any Indebtedness proposed to
be incurred on such date (as though all such Indebtedness was incurred on the
first day of the quarter in which the Determination Date occurred), but
specifically excluding Indebtedness proposed to be repaid or defeased (or with
respect to the defeasance of which a deposit satisfying the defeasance
requirements of such Indebtedness has irrevocably been made) on such date (as
though all such Indebtedness was repaid on the first day of the quarter in which
the Determination Date occurred); provided that if during the four-quarter
period referred to in clause (i) above, the Person for which the EBITDA Ratio is
being determined or any of its Restricted Subsidiaries shall have acquired any
assets other than assets acquired as a result of capital expenditures made in
the ordinary course of business of such Person, the EBITDA Ratio of such Person
as of such Determination Date shall be calculated on a pro forma basis, as if
such acquisition had occurred at the beginning of such four-quarter period. For
purposes of this definition, interest on Indebtedness determined on a
fluctuating basis for
6
periods succeeding the Determination Date shall be calculated as if the rate in
effect on the Determination Date had been the applicable rate for the entire
period, taking into account any Hedging Obligations applicable to such
Indebtedness.
"Equity Offering" means either (i) a bona fide underwritten
sale to the public of Common Stock of the Company or a Parent pursuant to a
registration statement (other than a Form S-8 or any other form relating to
securities issuable under any employee benefit plan of the Company) that is
declared effective by the Commission, or (ii) a privately negotiated sale of
Common Stock of the Company or a Parent by the Company or such Parent, as the
case may be, to a Person that, immediately prior to the time of such sale, is
not an Affiliate of the Company or such Parent, in each case completed following
the Initial Issuance Date and resulting in aggregate gross proceeds to the
Company or such Parent of at least $20 million; provided, that in the case of
any such sale of Common Stock of a Parent, (x) the net proceeds of such sale
shall be contributed within 30 days by such Parent to the Company or (y) the
Parent shall use such proceeds to purchase Capital Stock of the Company that is
not Disqualified Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder.
"Exchange Notes" means the Series B Notes to be issued by the
Company upon the expiration of the Exchange Offer pursuant to the terms of the
Registration Rights Agreement, containing terms identical in all material
respects to the Series A Notes (except that (i) the transfer restrictions
thereon shall be eliminated (other than as may be imposed by state securities
laws) and (ii) there will be no provision for the payment of Liquidated
Damages).
"Exchange Offer" means, subject to the terms of the
Registration Rights Agreement, the offer by the Company to the Holders of the
opportunity to exchange their Series A Notes for Exchange Notes pursuant to a
registration statement filed with the Commission.
"Existing Unrestricted Subsidiaries" means Cinemark
International and its Subsidiaries.
"50% Entity" shall have the meaning assigned to such term in
the definition of the term "Subsidiary."
"GAAP" means generally accepted accounting principles as
applied in the United States set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as may be
approved by a significant segment of the accounting profession of the United
States, which are applicable as of the date of determination; provided that the
definitions contained in this Indenture and all ratios and calculations
contained in the covenants contained herein shall be determined in accordance
with GAAP as in effect and applied by the Company on the date of this Indenture,
consistently applied; provided, further, that in the event of any such change in
GAAP or in any change by the Company in GAAP applied that would result in any
change in any such ratio or calculation, the Company shall deliver to the
Trustee each time any such ratio
7
or calculation is required to be determined or made, an Officer's Certificate
setting forth the computations showing the effect of such change or application
on such ratio or calculation.
"Global Note" means a Note that contains the paragraph called
for by footnote 1 and the schedule referred to in footnote 3 to the form of the
Note attached hereto as Exhibit A.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America or any agency or
instrumentality thereof for the payment of which guarantee or obligations the
full faith and credit of the United States is pledged.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Indebtedness
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 of such other Person (whether arising by virtue of participation
arrangements, by agreement to keep well, or to maintain financial statement
conditions or otherwise), (ii) to purchase, sell or lease (as lessee or lessor)
property, or to purchase or sell services, primarily for the purpose of enabling
such other Person to make payment of such Indebtedness, (iii) to supply funds to
or in any other manner invest in such other Person (including any agreement to
pay for property or services irrespective of whether such property is received
or such services are rendered), or (iv) entered into for the purpose of assuring
the obligee of such Indebtedness in any other manner 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 (i) endorsements for
collection or deposit in the ordinary course of business, and (ii) leases
entered into in the ordinary course of business.
"Hedging obligation" means any agreement, whether or not in
writing, relating to any transaction that is a rate swap, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity index swap
or option, bond, note or xxxx option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"Holder" or "Securityholder" means a Person in whose name a
Note is registered on the Register.
"Indebtedness" of any Person means, at any date, and without
duplication, any obligation of such Person or its Restricted Subsidiaries for or
in respect of: (i) money borrowed (whether or not for a cash consideration and
whether or not the recourse of the lender is to the whole of the assets of such
Person or only a portion thereof) and premiums (if any) and capitalized interest
(if any) in respect thereof; (ii) any debenture, bond, note or similar
instrument (whether or not issued for a cash consideration), if it would appear
as a liability on a balance sheet of such Person prepared in accordance with
GAAP; (iii) any letter of credit (other than in respect of Trade Payables),
bankers' acceptance or note purchase facility or any liability with respect to
any recourse receivables purchase, factoring or discounting arrangement; (iv)
8
Capitalized Lease Obligations (whether in respect of buildings, machinery,
equipment or otherwise), except any such obligation that represents a Trade
Payable; (v) any deferred purchase or conditional sale agreement or arrangement
representing the deferred and unpaid balance of the purchase price of any
property (including pursuant to financing leases), except any such balance which
represents a Trade Payable; (vi) all obligations to purchase, redeem, retire,
defease or otherwise acquire for value any Disqualified Stock of such Person (or
any warrants, rights or options to acquire such Disqualified Stock) valued, in
the case of Disqualified Stock, at the greatest amount payable in respect
thereof on a liquidation (whether voluntary or involuntary), prior to the Stated
Maturity of the Notes, plus accrued and unpaid dividends; (vii) preferred stock
of Restricted Subsidiaries of such Person held by Persons other than such Person
or one of its wholly Owned Subsidiaries that is a Restricted Subsidiary; (viii)
direct or indirect guarantees of all Indebtedness of other Persons referred to
in clauses (i) through (vii) above; and (ix) all Indebtedness of the types
referred to in clauses (i) through (viii) above secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) any Lien on any asset owned by such Person or its Restricted
Subsidiaries (even though such Person or its Restricted Subsidiaries have not
assumed or become liable for the payment of such Indebtedness); provided, that
the term "Indebtedness" shall not be deemed to include any liability for
federal, state, local or other taxes owed or owing by the Company. The amount of
Indebtedness of any Person or its Restricted Subsidiaries at any date shall be
(without duplication) (i) the outstanding balance at such date of all
unconditional Indebtedness obligations as described above and the maximum
liability of any such contingent Indebtedness obligations at such date, (ii) in
the case of Indebtedness of others secured by a Lien to which the property or
assets owned or held by such Person or its Restricted Subsidiaries is subject,
the lesser of the fair market value at such date of any property and assets
subject to a Lien securing the Indebtedness of others and the amount of the
Indebtedness secured, and (iii) in the case of Indebtedness of others guaranteed
by such Person as described above, the lesser of the maximum amount of such
guaranty and the amount of the Indebtedness guaranteed. A guaranty of
Indebtedness of the Company or a Restricted Subsidiary of the Company that is
permitted under the Indenture shall not constitute a separate incurrence of
Indebtedness.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Initial Issuance Date" means the date of original issuance of
the Series A Notes.
"Interest Payment Date" means each of February 1 and August 1.
"Investment" means any direct or indirect advance, loan or
other extension of credit or capital contribution to (by means of any transfer
of cash or other property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition of Capital Stock,
bonds, notes, debentures or other securities issued by, any other Person, other
than (i) loans or advances made to employees in the ordinary course of business
not in excess of $50,000 outstanding at any time to any employee, (ii) advances
to customers or suppliers in the ordinary course of business that are recorded
as accounts receivable on the balance sheet of any Person or its Subsidiaries
and any securities received in settlement thereof or as a result of a bankruptcy
or an insolvency proceeding, (iii) workers' compensation, utility, lease and
similar deposits and prepaid expenses in the ordinary course of business, (iv)
Capital Stock, bonds, notes, debentures and other assets received as a result of
Asset Dispositions not
9
prohibited by Section 4.10, and (v) endorsements of negotiable instruments and
documents in the ordinary course of business. In addition, (i) the fair market
value of the assets (net of liabilities) of any Restricted Subsidiary at the
time that such Restricted Subsidiary is designated an Unrestricted Subsidiary
shall constitute an Investment in such Subsidiary in such amount, if the Company
has elected that such designation be deemed to be an Investment and not an-Asset
Disposition, and (ii) the lesser of (A) the amount of Restricted Payments made
to any Unrestricted Subsidiary or (B) the fair market value of the assets (net
of liabilities) of such Unrestricted Subsidiary, in each case at the time that
such Unrestricted Subsidiary is designated a Restricted Subsidiary of the
Company, shall constitute a return of capital and a decrease in the amount of
the Company's Investment in such Subsidiary.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the Company's principal place of business, the City of
New York or at a place of payment are authorized by law, regulation or executive
order to remain closed. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
"Lien" means any mortgage, lien, pledge, security interest,
conditional sale or other title retention agreement, charge or other security
interest or encumbrance of any kind (including any agreement to give any
security interest).
"Liquidated Damages" means liquidated damages as defined in
Section 5 of the Registration Rights Agreement.
"Marketable Equity Securities" means shares of Capital Stock
of any Person that are listed on the
New York Stock Exchange, the American Stock
Exchange or the national market tier of The Nasdaq Stock Market and, upon
receipt by the Company or a Restricted Subsidiary, such shares are freely
tradable under the Securities Act and applicable state securities laws and are
so listed or included for trading privileges.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Proceeds" means the aggregate amount of consideration in
the form of Cash, Temporary Cash Investments or Marketable Equity Securities
received by the Company or any of its Restricted Subsidiaries with respect to
any Asset Disposition, after deducting therefrom brokerage commissions,
appraisal fees, survey charges, engineering fees, title insurance premiums,
legal fees, finder's fees, loan origination and similar fees, underwriting fees,
investment banking fees and other similar commissions or fees, and any filing,
recording or registration fees, costs and expenses, recording taxes, transfer
taxes, provisions for all taxes payable as a result of such Asset Disposition,
amounts required to be paid to any Person owning a beneficial interest in the
assets subject to such Asset Disposition, and appropriate amounts to be provided
as a reserve in accordance with GAAP against any liabilities associated with
such Asset Disposition after such Asset Disposition (to the extent such reserves
are not subsequently reversed), including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Disposition ("Asset Disposition Expenses"), and also less any
10
amounts required to be applied to retire all or a portion of the Notes or
Indebtedness permitted under Section 4.9 having the benefit of a Lien on the
property or assets so transferred, to the extent, but only to the extent, that
such amounts are paid by the Company or one of its Restricted Subsidiaries or
are amounts for which the Company or one of its Restricted Subsidiaries is
directly and not contingently liable, as the case may be, and properly
attributable to the transaction in respect of which such consideration is
received or to the asset that is the subject of such transaction.
"Note Custodian" means the Trustee, as custodian with respect
to the Notes in global form, or any successor entity thereto.
"Obligations" means any principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Offer" means a Change of Control Offer or Net Proceeds Offer,
as the case may be.
"Offer Purchase Date" means a Change of Control Purchase Date
or Net Proceeds Purchase Date, as the case may be.
"Offering Memorandum" means the Offering Memorandum, dated
August 12, 1996, relating to the offering of the Series A Notes.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer,
the Secretary, any Assistant Secretary, or any Vice-President of such Person.
"Officers Certificate" means a certificate signed on behalf of
the Company by two Officers of the Company, one of whom must be the Chairman of
the Board, the President or the Chief Financial Officer of the Company, that
meets the requirements of Section 11.5 hereof.
"Old Notes" means the Company's 12% Senior Notes due June 1,
2002.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee, that meets the requirements of Section
11.5 hereof. The counsel may be counsel to the Company, any Subsidiary of the
Company or the Trustee.
"Parent" shall mean a Person or group of Persons created to
effectuate a holding company structure for the Company and its Subsidiaries.
"Permitted Investment" means (i) an Investment in the Company
or a Wholly-Owned Subsidiary of the Company that is a Restricted Subsidiary;
(ii) an Investment in a Person, if such Person or a Subsidiary of such Person
will, as a result of the making of such Investment and all other contemporaneous
related transactions, become a Wholly-Owned Subsidiary of the
11
Company that is a Restricted Subsidiary or be merged or consolidated with or
into or transfer or convey all or substantially all its assets to the Company or
a Wholly-Owned Subsidiary of the Company that is a Restricted Subsidiary; (iii)
a Temporary Cash Investment; (iv) payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be treated
as expenses in accordance with GAAP; (v) stock, obligations or securities
received in settlement of debts owing to the Company or a Restricted Subsidiary
of the Company as a result of bankruptcy or insolvency proceedings or upon the
foreclosure, perfection, enforcement or agreement in lieu of foreclosure of any
Lien in favor of the Company or a Restricted Subsidiary of the Company; (vi)
refundable construction advances made with respect to the construction of
properties of a nature or type that are used in a business similar or related to
the business of the Company or its Restricted Subsidiaries in the ordinary
course of business; (vii) advances or extensions of credit on terms customary in
the industry in the form of accounts or other receivables incurred, or pre-paid
film rentals, and loans and advances made in settlement of such accounts
receivable, all in the ordinary course of business; (viii) guarantees not
prohibited by Section 4.9; (ix) entry into and Investments in joint ventures,
partnerships and other Persons engaged or proposing to engage in the indoor
motion picture exhibition business, provided that (A) the Person into which such
Investment is made is either a Restricted Subsidiary of the Company, or such
Person or a Subsidiary of such Person will, as a result of the making of such
Investment and all other contemporaneous related transactions, become a
Restricted Subsidiary of the Company and (B) the amount of such Investment,
valued at the time made, together with all Investments previously made pursuant
to this clause (ix), valued at the respective times made, shall not exceed 10%
of Consolidated Tangible Assets of the Company as of the last day of the full
fiscal quarter ending immediately prior to the date of such Investment; (x) any
Investment made solely with funds the payment or application of which is not
restricted pursuant to Section 4.7; (xi) Investments in the Notes; (xii) any
consolidation or merger of a Restricted Subsidiary that is a Wholly Owned
Subsidiary of the Company to the extent otherwise permitted under the Indenture;
(xiii) payments of up to $1.5 million annually to repurchase Capital Stock of
the Company issued under the Company's employee stock option-plans; (xiv)
Hedging Obligations of the Company or any of its Restricted Subsidiaries to the
extent otherwise permitted under the Indenture; (xv) Investments in Cinemark
International not to exceed $40 million; and (xvi) other Investments not to
exceed $10 million.
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, incorporated or unincorporated association,
joint-stock company, trust, unincorporated organization or government or other
agency or political subdivision thereof or other entity of any kind.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date hereof, by and among the Company and the other
parties thereto, as such agreement may be amended, modified or supplemented from
time to time.
"Representative" means, for any Senior Indebtedness, the
trustee, agent or representative with respect to such Senior Indebtedness.
"Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Administration of the Trustee (or
any successor group of the Trustee) or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate
12
trust matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means (i) any Subsidiary of the
Company in existence on the Initial Issuance Date other than the Existing
Unrestricted Subsidiaries, (ii) any Subsidiary of the Company (other than a
subsidiary that is also a Subsidiary of an Unrestricted Subsidiary) organized or
acquired after the Initial Issuance Date, unless such Subsidiary shall have been
designated as an Unrestricted Subsidiary by resolution of the Board of Directors
as provided in and in compliance with the definition of "Unrestricted
Subsidiary," and (iii) any Unrestricted Subsidiary which is designated as a
Restricted Subsidiary by the Board of Directors; provided that, immediately
after giving effect to the designation referred to in clause (iii), no Default
or Event of Default shall have occurred and be continuing and the Company could
incur at least $1.00 of additional Indebtedness under Section 4.9(a). The
Company shall evidence any such designation to the Trustee by promptly filing
with the Trustee an Officer's Certificate certifying that such designation has
been made and stating that such designation complies with the requirements of
the immediately preceding sentence.
"S&P" means Standard and Poor's Ratings Group, a division of
XxXxxx-Xxxx, Inc.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations thereunder.
"Senior Indebtedness" means (i) Indebtedness under the Credit
Facility, (ii) the Old Notes, and (iii) any other Indebtedness permitted to be
incurred by the Company under the terms of this Indenture, unless the instrument
under which such Indebtedness is incurred expressly provides that it is on a
parity with or subordinated in right of payment to the Notes. Notwithstanding
anything to the contrary in the foregoing, Senior Indebtedness will not include
(x) the Notes, (y) any Indebtedness of the Company to any of its Subsidiaries or
other Affiliates, or (z) any Indebtedness that is incurred in violation of the
terms of this Indenture.
"Significant Subsidiary" means, at any date of determination,
any Restricted Subsidiary of the Company that, together with its Restricted
Subsidiaries, (i) for the most recent fiscal year of the Company, accounted for
more than 5% of the consolidated revenues of the Company and its Restricted
Subsidiaries or (ii) as of the end of such fiscal year, was the owner of more
than 5% of the consolidated assets of the Company and its Restricted
Subsidiaries, all as set forth on the most recently available consolidated
financial statements of the Company for such fiscal year.
"Stated Maturity" means, when used with respect to any
security, the date specified in such security as the fixed date on which an
amount equal to the principal of such security is due and payable.
"Subsidiary" means, with respect to any Person, (i) a Person a
majority of whose Capital Stock with voting power under ordinary circumstances
to elect directors (or Persons having similar or corresponding powers and
responsibilities) is at the time, directly or indirectly, owned by such Person,
by one or more Subsidiaries of such Person or by such Person and one or
13
more Subsidiaries thereof or (ii) upon designation by the Company, and until
designation by the Company to the contrary, a Person, 50% of whose Capital Stock
with voting power under ordinary circumstances to elect directors (or Persons
having similar or corresponding powers and responsibilities) is at the time,
directly or indirectly, owned by such Person, by one or more Subsidiaries of
such Person or by such Person and one or more Subsidiaries thereof (a "50%
Entity"). The Company shall evidence any designation pursuant to clause (ii) of
the immediately preceding sentence to the Trustee by filing with the Trustee
within 45 days of such designation an Officer's Certificate certifying that such
designation has been made. All references within the Indenture to designations
of Unrestricted Subsidiaries as Restricted Subsidiaries or Restricted
Subsidiaries as Unrestricted Subsidiaries shall be deemed to include
designations of 50% Entities as Restricted Subsidiaries and Restricted
Subsidiaries as 50% Entities, respectively.
"Temporary Cash Investments" means any Investment in the
following kinds of instruments: (A) readily marketable obligations issued or
unconditionally guaranteed as to principal and interest by the United States of
America or by any agency or authority controlled or supervised by and acting as
an instrumentality of the United States of America if, on the date of purchase
or other acquisition of any such instrument by the Company or any Restricted
Subsidiary of the Company, the remaining term to maturity or interest rate
adjustment is not more than two years; (B) obligations (including, but not
limited to, demand or time deposits, bankers' acceptances and certificates of
deposit) issued or guaranteed by a depository institution or trust company
incorporated under the laws of the United States of America, any state thereof,
the District of Columbia, Canada or any province or territory thereof, provided
that (1) such instrument has a final maturity not more than one year from the
date of purchase thereof by the Company or any Restricted Subsidiary of the
Company and (2) such depository institution or trust company has at the time of
the Company's or such Restricted Subsidiary's Investment therein or contractual
commitment providing for such Investment, (x) capital, surplus and undivided
profits (as of the date of such institution's most recently published financial
statements) in excess of $100 million and (y) the long-term unsecured debt
obligations (other than such obligations rated on the basis of the credit of a
Person other than such institution) of such institution, at the time of the
Company's or such Restricted Subsidiary's Investment therein or contractual
commitment providing for such Investment, are rated in the highest rating
category of both S&P and Xxxxx'x; (C) commercial paper issued by any
corporation, if such commercial paper has, at the time of the Company's or any
Restricted Subsidiary's Investment therein or contractual commitment providing
for such Investment, credit ratings of at least A-1 by S&P and P-1 by Xxxxx'x;
(D) money market mutual or similar funds having assets in excess of $100
million; (E) readily marketable debt obligations issued by any corporation, if
at the time of the Company's or any Restricted Subsidiary's Investment therein
or contractual commitment providing for such Investment (1) the remaining term
to maturity is not more than two years and (2) such debt obligations are rated
in one of the two highest rating categories of both S&P and Xxxxx'x; (F) demand
or time deposit accounts used in the ordinary course of business with commercial
banks the balances in which are at all times fully insured as to principal and
interest by the Federal Deposit Insurance Corporation or any successor thereto
or any Canadian equivalent thereof; (G) demand or time deposit accounts used in
the ordinary course of business with overseas branches of commercial banks
incorporated under the laws of the United States of America, any state thereof,
the District of Columbia, Canada or any province or territory thereof, provided
that such commercial bank has, at the time of the Company's or such Restricted
Subsidiary's Investment therein, (1) capital, surplus and undivided profits (as
of the date of such
14
institution's most recently published financial statements) in excess of $100
million and (2) the long-term unsecured debt obligations (other than such
obligations rated on the basis of the credit of a Person other than such
institution) of such institution, at the time of the Company's or any Restricted
Subsidiary's Investment therein, are rated in the highest rating category of
both S&P and Xxxxx'x; and (H) to the extent not otherwise included herein, Cash
Equivalents. In the event that either S&P or Xxxxx'x ceases to publish ratings
of the type provided herein, a replacement rating agency shall be selected by
the Company with the consent of the Trustee, and in each case the rating of such
replacement rating agency most nearly equivalent to the corresponding S&P or
Xxxxx'x rating, as the case may be, shall be used for purposes hereof.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) and the rules and regulations thereunder, as in effect on
the date on which this Indenture is qualified under the TIA (except as provided
in Sections 9.1(e) and 9.3 hereof).
"Trade Payables" of any Person means accounts payable or any
other indebtedness or monetary obligations to trade creditors created, assumed
or guaranteed by such Person or any of its Subsidiaries in the ordinary course
of business in connection with the obtaining of materials or services.
"Transfer Restricted Securities" means securities that bear or
are required to bear the legend set forth in Section 2.6 hereof.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable provisions of this
Indenture and thereafter means the successor serving hereunder.
"Unrestricted Subsidiary" means, until such time as any of the
following shall be designated as a Restricted Subsidiary of the Company by the
Board of Directors as provided in and in compliance with the definition of
"Restricted Subsidiary," (i) each of the Existing Unrestricted Subsidiaries,
(ii) any Subsidiary of the Company or of a Restricted Subsidiary of the Company
organized or acquired after the Initial Issuance Date that is designated
concurrently with its organization or acquisition as an Unrestricted Subsidiary
by resolution of the Board of Directors, (iii) any Subsidiary of any
Unrestricted Subsidiary, and (iv) any Restricted Subsidiary of the Company that
is designated as an Unrestricted Subsidiary by resolution of the Board of
Directors, provided that, (A) immediately after giving effect to such
designation, no Default or Event of Default shall have occurred and be
continuing and (B) any such designation shall be deemed, at the election of the
Company at the time of such designation, to be either (but not both) (x) the
making of a Restricted Payment at the time of such designation in an amount
equal to the Investment in such Subsidiary subject to the restrictions contained
in Section 4.7 or (y) the making of an Asset Disposition at the time of such
designation in an amount equal to the Investment in such Subsidiary subject to
the restrictions contained in Section 4.10. The Company shall evidence any
designation pursuant to clause (ii) or (iv) of the immediately preceding
sentence to the Trustee by filing with the Trustee within 45 days of such
designation an officer's Certificate certifying that such designation has been
made and, in the case of clause (iv), the related election of the Company in
respect thereof.
15
"U.S. Government Obligations" means securities that are (i)
direct obligations of the United States of America for the timely payment of
which its full faith and credit is pledged or (ii) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of the
United States of America, the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of America
which, in either case, are not callable or redeemable at the option of the
issuer thereof, and shall also include a depository receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act), as custodian, with respect to
any such U.S. Government Obligation or a specific payment of principal of or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt; provided, however, that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal of or interest on the U.S.
Government obligation evidenced by such depository receipt.
"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 any Subsidiary
of such Person all of whose Capital Stock with voting power under ordinary
circumstances to elect directors (or Persons having similar or corresponding
powers and responsibilities), other than directors' qualifying shares if
required by applicable law, is owned by such Person (either directly or
indirectly through Wholly Owned Subsidiaries).
Section 1.2. Other Definitions.
Defined in
Term Section
---- -----------
"Affiliate Transaction".........................................................4.11
"Change of Control Offer"...................................................4.14 (a)
"Change of Control Offer Price".............................................4.14 (a)
"Change of Control Purchase Date"...........................................4.14 (a)
"Covenant Defeasance"............................................................8.3
"Discharge"......................................................................8.5
"DTC"........................................................................2.1 (b)
"DTC Participants"...........................................................2.1 (b)
"Event of Default................................................................6.1
"Incurrence"..................................................................4.9(a)
"Legal Defeasance"...............................................................8.2
"Net Proceeds Offer..........................................................4.10(a)
"Net Proceeds Offer Price"...................................................4.10(a)
"Net Proceeds Purchase Date".................................................4.10(a)
"Net Proceeds Offer Amount"..................................................4.10(a)
16
"Other Consideration"........................................................4.10(f)
"Paying Agent"...................................................................2.3
"Pari Passu Offer"...........................................................4.10(b)
"Pari Passu Offer Amount"....................................................4.10(b)
"Payment Blockage Notice".......................................................10.3
"Refinancing Indebtedness"....................................................4.9(a)
"Register".......................................................................2.3
"Registrar"......................................................................2.3
"Restricted Payments".........................................................4.7(a)
"SEC"............................................................................1.1 ("Commission")
"75% Test"......................................................................4.10(a)
"Surviving Entity................................................................5.1
"Transaction Value..............................................................4.10(f)
Section 1.3. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee;
"obligor" on the Notes means the Company and any successor
obligor upon the Notes.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
Section 1.4. Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the
plural include the singular;
17
(e) provisions apply to successive events and transactions;
(f) references to sections of or rules under the Exchange Act
or the Securities Act shall be deemed to include substitute, replacement of
successor sections or rules adopted by the SEC from time to time; and
(g) "herein," "hereof" and other words or similar import refer
to this Indenture as a whole (as amended or supplemented from time to time) and
not to any particular Article, Section or other subdivision.
ARTICLE 2
THE NOTES
Section 2.1. Form and Dating.
(a) General Form of Notes. The Notes and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A
hereto, which Exhibit is part of this Indenture. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. Each Note
shall be dated the date of its authentication. The Notes shall be in minimum
denominations of $1000 and integral multiples thereof. The terms and provisions
contained in the Notes shall constitute, and are hereby expressly made, a part
of this Indenture and the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby. Notes offered and sold in reliance on Rule 144A under the
Securities Act will initially be issued only in the form of one or more Global
Notes. Notes offered and sold in reliance on any other exemption from
registration under the Securities Act will be issued only in the form of
Definitive Notes. Global Notes shall be substantially in the form of Exhibit A
attached hereto (including the text and schedule called for by footnotes 1 and 3
thereto). Definitive Notes shall be substantially in the form of Exhibit A
attached hereto (excluding the text and schedule called for by footnotes 1 and 3
thereto). Global Notes or Definitive Notes issued as Exchange Notes will not
include the legend called for by footnote 2 of Exhibit A.
(b) Form of Global Notes. Each Global Note (i) shall represent
such portion of the outstanding Notes as shall be specified therein, (ii) shall
provide that it shall represent the aggregate amount of outstanding Notes from
time to time endorsed thereon and that the aggregate amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions, (iii) shall be registered in
the name of the Depositary or its nominee, duly executed by the Company and
authenticated by the Trustee as provided herein, for credit to the respective
accounts of the Holders (or such accounts as they may direct) at the Depositary,
(iv) shall be delivered by the Trustee or its Agent to the Depositary or a Note
Custodian pursuant to the Depositary's instructions and (v) shall bear a legend
substantially to the following effect:
"Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a
New York
corporation ("DTC"), to the Company or its agent for
registration of transfer, exchange or payment, and any
certificate issued is registered in the
18
name of Cede & Co. or such other name as is required by an
authorized representative of DTC (and any payment hereon 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."
Members of, or participants in, the Depositary ("DTC Participants") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depositary, and the Depositary may be treated by the Company, the
Trustee, and any agent of the Company or the Trustee as the absolute owner of
such Global Note 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 to the Depositary or impair, as between the
Depositary and its agent members, the operation of customary practices governing
the exercise of the rights of a Holder of any Note.
Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the amount of outstanding Notes represented thereby
shall be made by the Trustee or the Note Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required
by Section 2.6 hereof.
(c) Form of Definitive Notes. Definitive Notes may be produced
in any manner determined by the Officers of the Company executing such Notes, as
evidenced by their execution of such Notes. The Trustee must register Definitive
Notes so issued in the name of, and cause the same to be delivered to, such
Person (or its nominee). Subject to the provisions of Section 2.6, any Person
having a beneficial interest in the Global Note may exchange such beneficial
interest, upon request to the Trustee, for fully certificated Definitive Notes
in duly registered form.
(d) Provisions Applicable to Forms of Notes. The Notes may
also have such additional provisions, omissions, variations or substitutions as
are not inconsistent with the provisions of this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with this Indenture,
any Applicable Law or with any rules made pursuant thereto or with the rules of
any securities exchange or governmental agency or as may be determined
consistently herewith by the Officer of the Company executing such Notes, as
conclusively evidenced by their execution of such Notes. All Notes shall be
otherwise substantially identical except as provided herein.
Subject to the provisions of this Article 2, a registered
Holder of a beneficial interest in a Global Note may grant proxies and otherwise
authorize any Person to take any action that a Holder is entitled to take under
this Indenture or the Notes.
19
Section 2.2. Execution and Authentication.
An officer shall sign the Notes for the Company by manual or
facsimile signature. The Company's seal may be reproduced on the Notes and may
be in facsimile form.
If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid or obligatory for any purpose or
entitled to the benefits of the Indenture until authenticated by the manual
signature of the Trustee or its authenticating agent. The signature shall be
conclusive evidence that the Note has been authenticated under this Indenture.
The Trustee shall, upon the delivery to the Trustee of a
written order of the Company signed by two Officers, from time to time,
authenticate Notes for original issue up to an aggregate principal amount of
$200,000,000. The aggregate principal amount of Notes outstanding at any time
may not exceed such amount except as provided in Section 2.7 hereof.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Notes. An authenticating agent may
authenticate Notes 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 an Agent to deal with the
Company or an Affiliate of the Company.
Section 2.3. Trustee, Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register ("Register") of the Notes and of their transfer
and exchange. The Company may also from time to time appoint one or more
co-registrars and one or more additional paying agents. The term "Registrar"
includes any co-registrar and the term "Paying Agent" includes any additional
paying agent. The Company may change any Paying Agent or Registrar upon notice
to the Holders. The Company shall notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. If the Company fails to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act, subject to the last paragraph of this Section 2.3, as such. The
Company or any of its Subsidiaries may act as Paying Agent or Registrar;
provided, however, that none of the Company, its Subsidiaries or the Affiliates
of the foregoing shall act (i) as Paying Agent in connection with redemptions,
offers to purchase, discharges and defeasance, as otherwise specified in this
Indenture, and (ii) as Paying Agent or Registrar if a Default or Event of
Default has occurred and is continuing.
The Company hereby appoints U.S. Trust Company of Texas, N.A.,
at its Corporate Trust Office, as the Trustee hereunder and U.S. Trust Company
of Texas, N.A. hereby accepts such appointment. The Trustee shall have the
powers and authority granted to and conferred upon it in the Notes and hereby
and such further powers and authority to act on behalf of the Company as may be
mutually agreed upon by the Company and the Trustee, and the
20
Trustee shall keep a copy of this Indenture available for inspection during
normal business hours at its Corporate Trust Office.
The Company-initially appoints DTC to act as Depositary with
respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.
All of the terms and provisions with respect to such powers
and authority contained in the Notes are subject to and governed by the terms
and provisions hereof.
The Trustee may resign as Registrar or Paying Agent upon 30
days prior written notice to the Company.
Section 2.4. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal of, or premium, if any, or interest on, the Notes, and
shall notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
of all such money over to the Trustee, the Paying Agent (if other than the
Company or a Subsidiary) shall have no further liability for the money. If the
Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
Section 2.5. Holder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable to it the most recent list available to it of the names
and addresses of all Holders and, after the consummation of the Exchange Offer,
shall otherwise strictly comply with TIA Section 312(a). If the Trustee is not
the Registrar, the Company shall furnish to the Trustee at least seven 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 require of the names and addresses of the Holders of Notes and, after the
consummation of the Exchange Offer, the Company shall otherwise strictly comply
with TIA Section 312(a).
Section 2.6. Transfer and Exchange.
(a) Transfer and Exchange of Definitive Notes. If Definitive
Notes are presented by a Holder to the Registrar with a request:
(x) to register the transfer of the Definitive Notes; or
21
(y) to exchange such Definitive Notes for an equal principal
amount of Definitive Notes of other authorized
denominations,
the Registrar shall register the transfer or make the exchange as requested if
its requirements for such transactions are met; provided, however, that the
Definitive Notes presented or surrendered for register of transfer or exchange:
(i) shall be duly endorsed or accompanied by a
written instruction of transfer in form
satisfactory to the Registrar duly executed
by such Holder or by such Holder's attorney,
duly authorized in writing; and
(ii) in the case of a Definitive Note that is a
Transfer Restricted Security, such request
shall be accompanied by the following
additional information and documents, as
applicable:
(A) if such Transfer Restricted Security is
being delivered to the Registrar by a Holder
for registration in the name of such Holder,
without transfer, a certification to that
effect from such Holder (in substantially
the form of Exhibit B hereto); or
(B) if such Transfer Restricted Security is
being transferred to a "qualified
institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance
with Rule 144A under the Securities Act or
pursuant to an exemption from registration
in accordance with Rule 144 or Rule 904
under the Securities Act or pursuant to an
effective registration statement under the
Securities Act, a certification to that
effect from such Holder (in substantially
the form of Exhibit B hereto); or
(C) if such Transfer Restricted Security is
being transferred in reliance on another
exemption from the registration requirements
of the Securities Act, a certification to
that effect from such Holder (in
substantially the form of Exhibit B hereto)
and an opinion of Counsel from such Holder
or the transferee reasonably acceptable to
the Company and to the Registrar to the
effect that such transfer is in compliance
with the Securities Act.
(b) Restrictions on Transfer of a Definitive Note for a
Beneficial Interest in a Global Note. A Definitive Note may not be exchanged for
a beneficial interest in a Global Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive Note,
duly endorsed or accompanied by appropriate instruments of transfer, in form
satisfactory to the Trustee, together with:
(i) if such Definitive Note is a Transfer
Restricted Security, a certification from
the Holder thereof (in substantially the
form of Exhibit B hereto) to the effect that
such beneficial interest is being
transferred to a "qualified institutional
buyer" (as defined in Rule
22
144A under the Securities Act) in accordance
with Rule 144A under the Securities Act or
pursuant to an exemption from registration
in accordance with Rule 144 or Rule 904
under the Securities Act; and
(ii) whether or not such Definitive Note is a
Transfer Restricted Security, written
instructions from the Holder thereof
directing the Trustee to make, or to direct
the Note Custodian to make, an endorsement
on the Global Note to reflect an increase in
the aggregate principal amount of the Notes
represented by the Global Note,
in which case the Trustee or its agent shall cancel such Definitive Note in
accordance with Section 2.11 hereof and cause, or direct the Note Custodian to
cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Note Custodian, the aggregate principal amount of
Notes represented by the Global Note to be increased accordingly. If no Global
Notes are then outstanding, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.2 hereof, the Trustee shall
authenticate a new Global Note in the appropriate principal amount.
(c) Transfer and Exchange of a Beneficial Interest in a Global
Note. The transfer and exchange of beneficial interests in Global Notes shall be
effected through the Depositary, in accordance with this Indenture and the
procedures of the Depositary therefor, which shall include restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act. Notwithstanding the foregoing, in the case of a Transfer
Restricted Security, a beneficial interest in a Global Note being transferred in
reliance on an exemption from the registration requirements of the Securities
Act (other than in accordance with Rule 144A, Rule 144 or Rule 904 under the
Securities Act) may only be transferred for a Definitive Note and pursuant to
the provisions of Section 2.6(d) below.
(d) Transfer and Exchange of a Beneficial Interest in a Global
Note for a Definitive Note.
(i) Any Person having a beneficial interest in a
Global Note may upon request exchange such
beneficial interest for a Definitive Note.
Upon receipt by the Trustee of written
instructions or such other form of
instructions as is customary for the
Depositary, from the Depositary or its
nominee on behalf of any Person having a
beneficial interest in a Global Note, and,
in the case of a Transfer Restricted
Security, the following additional
information and documents (all of which may
be submitted by facsimile):
(A) if such beneficial interest is being
transferred to the Person designated by the
Depositary as being the beneficial owner, a
certification to that effect from such
Person (in substantially the form of Exhibit
B hereto); or
23
(B) if such beneficial interest is being
transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A
under the Securities Act or pursuant to an
exemption from registration in accordance
with Rule 144 or Rule 904 under the
Securities Act or pursuant to an effective
registration statement under the Securities
Act, a certification to that effect from the
transferor (in substantially the form of
Exhibit B hereto); or
(C) if such beneficial interest is being
transferred in reliance on another exemption
from the registration requirements of the
Securities Act, a certification to that
effect from the transferor (in substantially
the form of Exhibit B hereto) and an Opinion
of Counsel from the transferee or transferor
reasonably acceptable to the Company and to
the Registrar to the effect that such
transfer is in compliance with the
Securities Act,
in which case the Trustee or the Note Custodian, at
the direction of the Trustee, shall, in accordance
with the standing instructions and procedures
existing between the Depositary and the Note
Custodian, cause the aggregate principal amount of
Global Notes to be reduced accordingly and, following
such reduction, the Company shall execute and, upon
receipt of an authentication order in accordance with
Section 2.2 hereof, the Trustee shall authenticate
and deliver to the transferee a Definitive Note in
the appropriate principal amount.
(ii) Definitive Notes issued in exchange for a
beneficial interest in a Global Note
pursuant to this Section 2.6 (d) shall be
registered in such names and in such
authorized denominations as the Depositary,
pursuant to instructions from its direct or
indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall
deliver such Definitive Notes to the Persons
in whose names such Notes are so registered.
(e) Restrictions on Transfer and Exchange of Global Notes.
Notwithstanding any other provision of this Indenture (other than the provisions
set forth in subsection (f) of this Section 2.6), a Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
(f) Authentication of Definitive Notes in Absence of
Depositary. If at any time:
(i) the Depositary for the Notes notifies the
Company that the Depositary is unwilling or
unable to continue as Depositary for the
Global Notes or, if at any time such
Depositary ceases to be a "clearing agency"
registered under the Exchange Act, and a
24
successor Depositary for the Global Notes is
not appointed by the Company within 90 days
after delivery of such notice; or
(ii) the Company, at its sole discretion,
notifies the Trustee in writing that it
elects to cause the issuance of Definitive
Notes under this Indenture in exchange for
all or any part of the Notes represented by
a Global Note or Global Notes,
the Depositary or the Note Custodian shall surrender such Global Note to the
Trustee, without charge, and then the Company shall execute, and the Trustee
shall, upon receipt of an authentication order in accordance with Section 2.2
hereof, authenticate and deliver in exchange for such Global Notes, Definitive
Notes in an aggregate principal amount equal to the principal amount of such
Global Notes. Such Definitive Notes shall be registered in such names as the
Depositary shall direct in writing.
(g) Legends.
(i) Except as permitted by the following
paragraphs (ii), and (iii), each Note
certificate evidencing Global Notes and
Definitive Notes (and all Notes issued in
exchange therefor or substitution thereof)
shall bear legends in substantially the
following form:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY PERSON EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS
AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT) WHO IS AN INSTITUTION (AN
"INSTITUTIONAL ACCREDITED INVESTOR"), (2)
AGREES THAT IT WILL NOT PRIOR TO THE DATE
WHICH IS THREE YEARS AFTER THE LATER OF THE
DATE OF ORIGINAL ISSUANCE OF THIS NOTE AND
THE LAST DATE ON WHICH THE ISSUER OR ANY
AFFILIATE OF THE ISSUER WAS THE OWNER OF
THIS NOTE (THE "RESALE RESTRICTION
TERMINATION DATE") RESELL, PLEDGE OR
OTHERWISE TRANSFER THIS NOTE, EXCEPT (A) TO
THE ISSUER, (B) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF ANOTHER
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
25
WITH THE RESALE PROVISIONS OF RULE 144A
UNDER THE SECURITIES ACT, (C) TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT,
PRIOR TO SUCH TRANSFER, FURNISHES TO THE
TRUSTEE A WRITTEN CERTIFICATION CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF
THIS NOTE (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM THE TRUSTEE), (D) PURSUANT TO
THE RESALE LIMITATIONS PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE), (E)
PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR (F)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, (BASED UPON AN OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE ISSUER
IF THE ISSUER SO REQUESTS) SUBJECT IN EACH
OF THE FOREGOING CASES TO ANY REQUIREMENT OF
LAW THAT THE DISPOSITION OF ITS PROPERTY OR
THE PROPERTY OF SUCH ACCOUNT BE AT ALL TIMES
WITHIN ITS CONTROL AND TO COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH
TO THE TRUSTEE AND THE ISSUER SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS EITHER OF THEM MAY REASONABLY
REQUIRE 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. THE FOREGOING RESTRICTIONS ON RESALE
WILL NOT APPLY SUBSEQUENT TO THE RESALE
RESTRICTION TERMINATION DATE.
(ii) Upon any sale or transfer of a Transfer
Restricted Security (including any Transfer
Restricted Security represented by a Global
Note) pursuant to Rule 144 under the
Securities Act or pursuant to an effective
registration statement under the Securities
Act:
(A) in the case of any Transfer Restricted
Security that is a Definitive Note, the
Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security
for a Definitive Note
26
that does not bear the legend set forth in
(i) above and rescind any restriction on the
transfer of such Transfer Restricted
Security; and
(B) in the case of any Transfer Restricted
Security represented by a Global Note, such
Transfer Restricted Security shall not be
required to bear the legend set forth in (i)
above, but shall continue to be subject to
the provisions of Section 2.6(c) hereof;
provided, however, that with respect to any
request for an exchange of a Transfer
Restricted Security that is represented by a
Global Note for a Definitive Note that does
not bear the legend set forth in (i) above,
which request is made in reliance upon Rule
144, the Holder thereof shall certify in
writing to the Registrar that such request
is being made pursuant to Rule 144 (such
certification to be substantially in the
form of Exhibit B hereto).
(iii) Notwithstanding the foregoing, upon
consummation of the Exchange Offer, the
company shall issue and, upon receipt of an
authentication order in accordance with
Section 2.2 hereof, the Trustee shall
authenticate Series B Notes in exchange for
Series A Notes accepted for exchange in the
Exchange Offer, which Series B Notes shall
not bear the legend set forth in (i) above,
and the Registrar shall rescind any
restriction on the transfer of such Notes,
in each case unless the Holder of such
Series A Notes is either (A) a
broker-dealer, (B) a Person participating in
the distribution of the Series A Notes or
(C) a Person who is an affiliate (as defined
in Rule 144A) of the Company.
(h) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in Global Notes have been exchanged for
Definitive Notes, redeemed, repurchased or cancelled, all Global Notes shall be
returned to or retained and cancelled by the Trustee or its agent in accordance
with Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for Definitive Notes,
redeemed, repurchased or cancelled, the principal amount of Notes represented by
such Global Note shall be reduced accordingly and an endorsement shall be made
on such Global Note, by the Trustee or the Notes Custodian, at the direction of
the Trustee, to reflect such reduction.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the
Trustee shall authenticate Definitive Notes
and Global Notes at the Registrar's request.
(ii) No service charge shall be made to a Holder
for any registration of transfer or
exchange, but the company may require
payment of a sum sufficient to cover any
transfer tax or similar governmental charge
payable in connection therewith (other than
any such transfer taxes or similar
governmental charge payable upon
27
exchange or transfer pursuant to Sections
2.2, 2.10, 3.6, 3.7, 4.10, 4.14 and 9.5
hereto).
(iii) All Definitive Notes and Global Notes issued
upon any registration of transfer or
exchange of Definitive Notes or Global Notes
shall be the valid obligations of the
Company, evidencing the same debt, and
entitled to the same benefits under this
Indenture, as the Definitive Notes or Global
Notes surrendered upon such registration of
transfer or exchange.
(iv) Neither the Registrar nor the Company shall
be required:
(A) to issue, to register the transfer of or to
exchange Notes during a period beginning at
the opening of business 15 Business Days
before the day of any selection of Notes for
redemption under Section 3.2 hereof and
ending at the close of business on the day
of selection; or
(B) to register the transfer of or to exchange
any Note so selected for redemption in whole
or in part, except the unredeemed portion of
any Note being redeemed in part; or
(C) to register the transfer of or to exchange a
Note between a record date and the next
succeeding Interest Payment Date.
(v) The Trustee shall authenticate Definitive
Notes and Global Notes in accordance with
the provisions of Section 2.2 hereof.
(j) Certain Transfers in Connection with and after the
Exchange Offer. Notwithstanding any other provision of this Indenture: (i) no
series B Note may be exchanged by the Holder thereof for a Series A Note; (ii)
accrued and unpaid interest on the Series A Notes being exchanged in the
Exchange Offer shall be due and payable on the next Interest Payment Date for
the Series B Notes following the Exchange Offer; and (iii) interest on the
Series B Notes to be issued in the Exchange Offer shall accrue from the date of
the Exchange Offer.
Section 2.7. Replacement Notes.
If any mutilated Note is surrendered to the Trustee, or the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Note, the Company shall, upon the written
request of the Holder thereof, issue and the Trustee, upon the written order of
the Company signed by two Officers of the Company, shall authenticate a
replacement Note if the Trustees requirements are met. If required by the
Trustee or the Company, an indemnity bond must be supplied by such Holder that
is sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. The Company may charge for its
expenses in replacing a Note.
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Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.
The provisions of this Section 2.7 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.8. Outstanding Notes.
The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it (or its agent),
those delivered to it (or its agent) for cancellation, those reductions in the
interest in a Global Note effected by the Trustee in accordance with the
provisions hereof, and those described in this Section as not outstanding.
Except as set forth in Section 2.9 hereof, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.7 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note (other than a mutilated Note surrendered for replacement)
is held by a bona fide purchaser (as such term is defined in Section 8-302 of
the Uniform Commercial Code as in effect in the State of
New York).
If the principal amount of any Note is considered paid under
Section 4.1 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of any thereof) holds, on a redemption date or maturity date, Cash
or Cash Equivalents sufficient to pay Notes payable on that date, then on and
after that date such Notes shall be deemed to be no longer outstanding and shall
cease to accrue interest.
Section 2.9. Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that a Responsible Officer of the
Trustee has actual knowledge are so owned shall be so disregarded.
Section 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes upon a written order
of the Company signed by two Officers of the Company. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate definitive Notes in exchange for temporary
Notes.
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Until such exchange, Holders of temporary Notes shall be
entitled to all of the benefits of this Indenture.
Section 2.11. Cancellation.
The Company at any time may deliver Notes to the Trustee or
its Agent for cancellation. The Registrar and Paying Agent shall forward to the
Trustee any Notes surrendered to them for registration of transfer, exchange or
payment. The Trustee (or its Agent) and no one else shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall destroy cancelled Notes (subject to the record retention
requirement of the Exchange Act). Certification of the destruction of all
cancelled Notes shall be delivered to the Company from time to time. The Company
may not issue new Notes to replace Notes that it has paid or that have been
delivered to the Trustee (or its Agent) for cancellation. If the Company
acquires any of the Notes, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Notes unless and until the
same are surrendered to the Trustee (or its Agent) for cancellation pursuant to
this Section 2.11.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Notes,
it shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.1 hereof. The Company shall notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than 10 days prior to the related payment date for
such defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the name
and at the expense of the Company) shall mail or cause to be mailed to Holders a
notice that states the special record date, the related payment date and the
amount of such defaulted interest to be paid.
Section 2.13. Persons Deemed Owners.
Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent, the Company and any agent of the foregoing
shall deem and treat the Person in whose name any Note is registered as the
absolute owner of such Note for all purposes (including the purpose of receiving
payment of principal of and interest on such Notes; provided that defaulted
interest shall be paid as set forth in Section 2.12), and none of the Trustee,
any Agent, the Company or any agent of the foregoing shall be affected by notice
to the contrary.
Section 2.14. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will print CUSIP numbers
on the Notes, and the Trustee may use CUSIP numbers in notices of redemption and
purchase as a convenience to Holders; provided, however, that any such notices
may state that no representation is made as to the correctness of such numbers
as printed on the Notes and that reliance may be placed only on
30
the other identification numbers printed on the Notes, and any such redemption
or purchase shall not affected by any defect or omission in such numbers.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.1. Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.7 hereof, it shall furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date (unless a
shorter period is acceptable to the Trustee), an Officers Certificate setting
forth (i) the clause of Section 3.7 pursuant to which the redemption shall
occur, (ii) the redemption date, (iii) the principal amount of Notes to be
redeemed, (iv) the redemption price and accrued and unpaid interest and (v)
whether it requests the Trustee to give notice of such redemption. Any such
notice may be cancelled at any time prior to the mailing of notice of such
redemption to any Holder and shall thereby be void and of no effect.
Section 3.2. Section 3.2. Selection of Notes to Be Redeemed.
If fewer than all of the Notes are to be redeemed at any time,
the Trustee shall select the Notes to be redeemed among the Holders of the Notes
in compliance with the requirements of any applicable Depositary and securities
exchange requirements or, if the Notes are not so listed, on a pro rata basis,
by lot or in accordance with any other method the Trustee considers fair and
appropriate and in such manner as complies with any such requirements and any
applicable legal requirements; provided that no Notes of $1,000 principal amount
or less shall be redeemed in part. In the event of partial redemption by lot,
the particular Notes to be redeemed shall be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption date by
the Trustee from the outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of $1,000 or whole multiples of
$1,000; except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not a multiple
of $1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.3. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption
date, the Company shall mail or cause to be mailed, by first class mail, a
notice of redemption to each Holder whose Notes are to be redeemed at such
Holder's registered address.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
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(b) the redemption price and accrued and unpaid interest;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to accrue on
and after the redemption date and the only remaining right of the Holders of
such Notes is to receive payment of the redemption price upon surrender to the
Paying Agent of the Notes redeemed;
(g) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being redeemed;
and
(h) 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
Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 40 days prior to the
redemption date (unless a shorter period is acceptable to the Trustee), an
Officers' Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in the preceding
paragraph.
Section 3.4. Effect of Notice of Redemption.
Unless otherwise stated therein, once notice of redemption is
mailed in accordance with Section 3.3 hereof, Notes called for redemption become
irrevocably due and payable on the redemption date at the redemption price.
Section 3.5. Deposit of Redemption Price.
On or prior to the redemption date, the Company shall deposit
with the Paying Agent (other than the Company or any of its Subsidiaries) money
sufficient in same day funds to pay the redemption price of and accrued interest
on all Notes to be redeemed on that date. The Paying Agent shall promptly return
to the Company any money deposited with the Paying Agent by the Company in
excess of the amounts necessary to pay the redemption price of, and accrued
interest on, all Notes to be redeemed. If the money is deposited on the
redemption date, such deposit shall be made by 10:00 a.m. Dallas, Texas time.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue on
the Notes or the portions of Notes called for redemption whether or not such
Notes are presented for payment, and the only
32
remaining right of the Holders of such Notes shall be to receive payment of the
redemption price upon surrender to the Paying Agent of the Notes redeemed. If a
Note is redeemed on or after an interest record date but on or prior to the
related interest payment date, then any accrued and unpaid interest shall be
paid to the Person in whose name such Note was registered at the close of
business on such record date. If any Note called for redemption shall not be so
paid upon surrender for redemption because of the failure of the Company to
comply with the preceding paragraph, interest shall be paid on the unpaid
principal from the redemption date until such principal is paid and to the
extent lawful, on any interest not paid on such unpaid principal, in each case
at the rate provided in the Notes and in Section 4.1 hereof.
Section 3.6. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon the Company's written request, the Trustee shall
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed portion of the Note surrendered.
Section 3.7. Optional Redemption.
(a) Except as set forth in clause (b) of this Section 3.7, the
Company shall not have the option to redeem the Notes pursuant to this Section
3.7 prior to August 1, 2001. Thereafter, the Notes will be subject to redemption
at the option of the Company, in whole or in part, upon not less than 30 nor
more than 60 days notice, at the redemption prices (expressed as percentages of
principal amount) set forth below plus accrued and unpaid interest thereon to
the applicable redemption date, if redeemed during the twelve month period
beginning on August 1 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2001 104.813%
2002 102.406%
2003 and thereafter 100.000%
(b) Notwithstanding the foregoing, on and prior to August 1,
1999, the Company may redeem up to 35% of the aggregate principal amount of the
Notes originally outstanding at a redemption price of 110% of the principal
amount thereof, plus accrued and unpaid interest thereon to the redemption date,
with the net proceeds of one or more Equity Offerings of the Company or, if
applicable, a Parent; provided that at least 65% of the aggregate principal
amount of the Notes originally issued remains outstanding immediately after the
occurrence of such redemption (but such unredeemed Notes may be redeemed
pursuant to the optional redemption procedure described in section 3.7(a)); and
provided, further, that such notice of redemption shall be given not later than
30 days, and such redemption shall occur not later than 90 days, after the date
of the closing of any such Equity Offering.
(c) Any redemption pursuant to this Section 3.7 shall be made
pursuant to the provisions of Sections 3.1 through 3.6 hereof.
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Section 3.8. Mandatory Redemption.
Except as set forth under Sections 4.10 and 4.14 hereof, the
Company shall not be required to make mandatory redemption payments with respect
to the Notes.
ARTICLE 4
COVENANTS
Section 4.1. Payment of Notes.
The Company shall pay or cause to be paid in
New York,
New
York the principal of, premium, if any, and interest on the Notes on the dates
and in the manner provided in the Notes. Principal, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent, if other
than the Company or a Subsidiary thereof, holds as of 10:00 a.m.
New York City
time on the due date money deposited by the Company in same day funds and
designated for and sufficient to pay all principal, premium, if any, and
interest then due. The Paying Agent shall return to the Company, no later than
three Business Days following the date of payment, any money (including accrued
interest) in excess of the amounts paid on the Notes.
The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at a
rate equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law to the extent that such
interest is an allowed claim against the debtor under such Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace period)
at the same rate to the extent lawful.
Section 4.2. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the
City of
New York, an office or agency (which may be an office of the Trustee or
an affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of
New York for such purposes. The Company shall
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
34
The company hereby designates the corporate Trust Office of
the Trustee as one such office or agency of the Company in accordance with
Section 2.3.
Section 4.3. Provisions of Reports and Other Information.
(a) Whether or not required by the rules and regulations of
the Commission, so long as any Notes are outstanding, the Company will furnish
to the Trustee and the Holders of Notes (i) all quarterly and annual financial
information that would be required to be contained in a filing with the
Commission on Forms l0-Q and 10-K if the Company were required to file such
forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial position and results of
operations of the Company and its Subsidiaries and, with respect to the annual
information only, a report thereon by the Company's certified independent
accountants and (ii) all current reports that would be required to be filed with
the Commission on Form 8-K if the Company were required to file such reports. In
addition, whether or not required by the rules and regulations of the
Commission, the Company will file a copy of all such information and reports
with the Commission for public availability (unless the Commission will not
accept such a filing) and make such information available to prospective
investors upon request. The Company shall include an unaudited consolidating
balance sheet and related statements of income and cash flows for the Company
and its Subsidiaries, separately identifying the Company and its Restricted
Subsidiaries as one group and the Company's Unrestricted Subsidiaries as a
separate group, in all reports containing the consolidated financial statements
(which in the case of annual reports shall be audited) of the Company and its
consolidated Subsidiaries which are required to be delivered by the Company to
the Securityholders pursuant to this Section 4.3, including the Company's Annual
Reports on Form 10-K and Quarterly Reports on Form 10-Q. If required by the
terms thereof, the Company shall also comply with the provisions of TIA Section
314(a).
(b) So long as any of the Transfer Restricted Securities
remain outstanding, the Company shall furnish to the Holders of the Transfer
Restricted Securities and to prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
(c) If the Company instructs the Trustee to distribute any of
the documents described in Section 4.3 (a) to the Holders, the Company shall
provide the Trustee with a sufficient number of copies of all such documents
that the Company may be required to deliver to such Holders.
Section 4.4. Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 45 days
after the end of each fiscal quarter, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal quarter has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture
35
(or, if a Default or Event of Default shall have occurred, describing all such
Defaults or Events of Default of which he or she may have knowledge and what
action the Company is taking or proposes to take with respect thereto) and that
to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of, or
interest on, the Notes are prohibited or, if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.
(b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section 4.3 above shall be
accompanied by a written statement of the company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article 4 or Article 5 hereof or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The company shall, so long as any of the Notes are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default, an Officers' Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto.
Section 4.5. Taxes.
The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except (i) such as are contested in good faith and by
appropriate proceedings or (ii) such as for which reserve or other appropriate
provision, if any, as shall be required to be in conformity with GAAP, has been
made therefor, or (iii) where the failure to effect such payment is not adverse
in any material respect to the Holders of the Notes.
Section 4.6. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury 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 covenants that it shall not, by resort to any
such law, 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 has been enacted.
Section 4.7. Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend on, or
make any distribution to the holders of, any Capital Stock of the Company or a
Restricted Subsidiary, other than dividends or distributions (A) from a
Restricted Subsidiary of the Company to the Company or to a Restricted
36
subsidiary or (B) payable in Capital Stock of the Company that is not
Disqualified Stock; (ii) repay, redeem or otherwise acquire or retire for value
any Capital Stock of the Company or any of its Subsidiaries (other than Wholly
Owned Subsidiaries of the Company that are Restricted Subsidiaries), other than
a Permitted Investment; (iii) prepay, repay, redeem, defease or otherwise
acquire or retire for value prior to any scheduled maturity, scheduled repayment
or scheduled sinking fund payment, any Indebtedness of the Company that is pari
passu with or subordinated in right of payment to the Notes, other than a
Permitted Investment and except (A) as permitted pursuant to clause (vii) of
Section 4.9(b), (B) upon a change of control, as defined in and to the extent
required by the indenture or other agreement or instrument pursuant to which
such pari passu or subordinated Indebtedness was issued, provided the Company is
then in compliance with the provisions of Section 4.14 and (C) any payment
pursuant to a Pari Passu Offer; or (iv) make any Investment other than a
Permitted Investment or as permitted under clauses (ii) and (iii) above (the
foregoing actions set forth in clauses (i) through (iv) being referred to
hereinafter as "Restricted Payments"), if at the time of any such Restricted
Payment, and after giving effect thereto on a pro forma basis:
(A) a Default or Event of Default shall have
occurred and be continuing or would result
therefrom; or
(B) the aggregate amount of all Restricted
Payments declared or made after the Initial
Issuance Date including such Restricted
Payment (the value of any such payment, if
other than cash, shall be the value
determined in good faith by resolution of
the Board of Directors) shall exceed the sum
of: (1) 50% of the aggregate Consolidated
Net Income (after deducting from such
Consolidated Net Income accrued but unpaid
compensation expenses related to any stock
appreciation or stock option plans net of
tax benefits), or, in the event such
aggregate Consolidated Net Income shall be a
loss, minus 100% of such loss, of the
Company and its Restricted Subsidiaries
earned subsequent to the Initial Issuance
Date to the end of the fiscal quarter
immediately preceding the date of such
Restricted Payment (treated as a single
accounting period), plus (2) the aggregate
net proceeds received by the Company from
the issuance or sale (other than to a
Subsidiary of the Company) of Capital Stock
of the Company, including any such shares
issued upon exercise of any warrants,
options or similar rights (other than
Disqualified Stock), subsequent to the
Initial Issuance Date, plus (3) the
aggregate net proceeds received by the
Company from the issuance or sale of
Indebtedness that is convertible into
Capital Stock after the Initial Issuance
Date, to the extent that such Indebtedness
is actually converted into Capital Stock
(other than Disqualified Stock), plus (4)
the aggregate net proceeds received after
the Initial Issuance Date by the Company as
capital contributions to the Company (other
than from a Subsidiary), plus (5) an amount
equal to the net reduction in Investments
resulting from payments of principal of
Indebtedness, return of capital and other
transfers of assets, in each case to the
Company or any
37
Restricted Subsidiary of the Company (but
excluding any such amounts included in
Consolidated Net Income), or from
designations of Unrestricted Subsidiaries as
Restricted Subsidiaries, plus (6) $15
million.
(b) The foregoing provisions of this Section 4.7 shall not
prohibit:
(i) the payment of any dividend within 60
calendar days after the date of declaration
thereof, if at the date of declaration such
dividend would have complied with the
provisions of this Indenture;
(ii) the repayment, redemption, acquisition or
retirement for value of any Capital Stock of
the Company or any of its Subsidiaries in
exchange for, or out of the aggregate net
proceeds of, a substantially concurrent
issuance (other than to the Company or any
of its Restricted Subsidiaries) of Capital
Stock of the Company or a Restricted
Subsidiary of the Company;
(iii) the prepayment, repayment, redemption,
defeasance or other acquisition or
retirement for value prior to any scheduled
maturity, scheduled repayment or scheduled
sinking fund payment of any Indebtedness of
the Company that is pari passu with or
subordinated in right of payment to the
Notes, in exchange for, or out of the
aggregate net proceeds of, a substantially
concurrent issuance (other than to the
Company or a Restricted Subsidiary) of
Capital Stock of the Company or a Restricted
Subsidiary of the Company;
(iv) the prepayment, repayment, redemption,
defeasance or other acquisition or
retirement for value prior to any scheduled
maturity, scheduled repayment or scheduled
sinking fund payment of any Indebtedness of
the Company that is pari passu with or
subordinated in right of payment to the
Notes, in exchange for, or out of the
aggregate net proceeds of, a substantially
concurrent issuance (other than to the
Company or a Restricted Subsidiary) of
Indebtedness of the Company that is pari
passu with or subordinated in right of
payment to, the Notes, but only if the
Weighted Average Life and period of time to
Stated Maturity of such new Indebtedness are
each greater than the Weighted Average Life
and period of time to Stated Maturity of
such retired Indebtedness; and
(v) the payment of any dividend or distribution
to any holder of Capital Stock of a
Restricted Subsidiary of the Company, other
than a holder that is an Affiliate of the
Company (except a holder that is an
Affiliate of the Company solely by virtue of
the ownership of such Capital Stock), as
part of a pro rata dividend or
38
distribution to all holders of such class or
series of Capital Stock (but only the amount
of such dividend or distribution paid to a
Person other than the Company or a
Restricted Subsidiary of the Company shall
constitute a Restricted Payment).
For purposes of calculating the aggregate amount of Restricted
Payments made pursuant to Section 4.7(a)(B) above, payments made under this
Section 4.7(b) (other than under clause (iv) hereof) shall be included in such
amount; provided that dividends paid within 60 calendar days of the date of
declaration shall be deemed to be paid at the date of declaration.
Section 4.8. Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company shall not, and shall not permit any of the
Restricted Subsidiaries of the Company to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction on the ability of such Restricted Subsidiary to (i)
pay dividends or make any other distributions on its Capital Stock, or pay any
Indebtedness owed to the Company or any of its Restricted Subsidiaries, (ii)
make any Investment in the Company or any of its Restricted Subsidiaries, (iii)
transfer any of its properties or assets to the Company or any of its Restricted
Subsidiaries or (iv) guarantee any Indebtedness of the Company or any of its
Restricted Subsidiaries, except for such encumbrances or restrictions existing
under or by reason of (A) applicable law, (B) any instrument governing Acquired
Indebtedness permitted to be incurred under Section 4.9 which encumbrances or
restrictions are not applicable to any Person or the properties or assets of any
Person, other than the Person so acquired or its Subsidiaries, or the property
or assets of the Person so acquired or its Subsidiaries, (C) any restrictions
existing under agreements in effect on the Initial Issuance Date, (D) any
restrictions with respect to a Restricted Subsidiary imposed pursuant to an
agreement which has been entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of such Restricted Subsidiary,
provided, that such disposition is permitted pursuant to Section 4.10, (E) any
agreement governing Indebtedness otherwise permitted under the Indenture
restricting the sale or other disposition of property securing such Indebtedness
if such agreement does not expressly restrict the ability of a Restricted
Subsidiary to pay dividends or to make distributions, loans or advances, (F) the
issuance of preferred stock by a Restricted Subsidiary or the payment of
dividends thereon in accordance with the terms thereof, provided that issuance
of such preferred stock is permitted pursuant to Section 4.9 and the terms of
such preferred stock do not expressly restrict the ability of a Restricted
Subsidiary to pay dividends or make any other distributions on its Capital Stock
(other than requirements to pay dividends or liquidation preferences on such
preferred stock prior to paying any dividends or making any other distributions
on such other Capital Stock), (G) this Indenture, (H) the Credit Facility and
other Senior Indebtedness, (I) supermajority voting requirements existing under
corporate charters, bylaws, stockholders agreements and the like, (J) in the
case of clause (iii) above, agreements (1) that restrict in a customary manner
the subletting, pledging, assignment or transfer of any property or asset that
is a lease, license, conveyance or contract or similar property or asset, or (2)
existing by virtue of any transfer of, agreement to transfer, option or right
with respect to, or Lien on, any property or assets of the Company or any
Restricted Subsidiary not otherwise prohibited by this Indenture, including,
without limitation, transfer restrictions on any specific properties or assets
that are subject to a sale agreement otherwise permitted pursuant
39
Section 4.10, or (K) existing under any agreement which refinances or replaces
any of the agreements in the preceding clauses; provided, that the terms and
conditions of any such restrictions are not materially less favorable to the
Holders than those contained in the agreements refinanced or replaced. Nothing
contained in this Section 4.8 shall prevent the Company or any Restricted
Subsidiary from (1) creating, incurring, assuming or suffering to exist any
Liens otherwise permitted under Section 4.12 or (2) restricting the sale or
other disposition of property or assets of the Company or any of its Restricted
Subsidiaries that secure Indebtedness of the Company or any of its Restricted
Subsidiaries.
Section 4.9. Limitation on Indebtedness.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary of the Company to, directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable with respect
to, any Indebtedness (collectively, an "incurrence"; with respect to any
non-interest bearing or other discount Indebtedness, an "incurrence" shall be
deemed to have occurred only on the date of original issuance thereof), unless,
after giving effect to the incurrence of such Indebtedness and the application
of the net proceeds therefrom, the EBITDA Ratio (as calculated on the
Determination Date) is greater than 2.0 to 1.0; provided that if the
Indebtedness which is the subject of a determination under this provision is
Acquired Indebtedness, then the Consolidated EBITDA of the Company shall be
determined by giving effect (on a pro forma basis, as if the transaction had
occurred at the beginning of the immediately preceding four-quarter period) to
both the incurrence or assumption of such Acquired Indebtedness by the Company
and the inclusion in the Consolidated EBITDA of the Person whose Indebtedness
would constitute Acquired Indebtedness.
(b) Notwithstanding the foregoing, Indebtedness may be
incurred as follows:
(i) Indebtedness under the Credit Facility in an
aggregate principal amount not to exceed
$195 million at any one time outstanding,
less the aggregate amount of all permanent
reductions thereto pursuant to Section 4.10;
(ii) Indebtedness represented by amounts due
under Hedging Obligations (provided that the
obligations under such Hedging obligations
are related to Indebtedness otherwise
permitted by the terms of this Section 4.9
and that the aggregate notional principal
amount of such Hedging Obligations shall not
exceed 105% of the total amount of the
related underlying Indebtedness);
(iii) Indebtedness represented by property,
liability and workers' compensation
insurance, performance bonds (which may be
in the form of letters of credit) for
construction contracts let by the Company
and its Restricted Subsidiaries in the
ordinary course of business (provided that
to the extent that such performance bonds
secure Indebtedness, such Indebtedness is
otherwise permitted under this Section 4.9),
surety bonds and appeal bonds (which, in
each case, may be in the form of letters of
credit) required in the
40
ordinary course of business or in connection
with the enforcement of rights or claims of
the Company or any Restricted Subsidiary of
the Company or in connection with judgments
that do not result in a Default or an Event
of Default;
(iv) Indebtedness of the Company evidenced by the
Notes and this Indenture;
(v) Indebtedness owing to a Wholly Owned
Subsidiary of the Company that is a
Restricted Subsidiary or to the Company;
(vi) Acquired Indebtedness, provided that such
Indebtedness if incurred by the Company
would be in compliance with the first
paragraph of this covenant;
(vii) Indebtedness issued in exchange for, or the
proceeds of which are used to repay or
refund or refinance or discharge or
otherwise retire for value, Indebtedness of
the Company or any of its Restricted
Subsidiaries permitted under clauses (iv)
and (vi) above, clause (viii) below and
Section 4.9(a) ("Refinancing Indebtedness")
in a principal amount not to exceed the
principal amount of the Indebtedness so
refinanced plus any premium and accrued
interest plus customary fees, expenses and
costs related to the incurrence of such
Refinancing Indebtedness, provided that with
respect to any Refinancing Indebtedness
which refinances Indebtedness which ranks
junior in right of payment to the Notes, (A)
such Refinancing Indebtedness is
subordinated in right of payment at least to
the same extent as the Indebtedness to be
refunded or refinanced if such Indebtedness
had remained outstanding and (B) the
Refinancing Indebtedness has a Weighted
Average Life and Stated Maturity that are
equal to or greater than those of the
Indebtedness to be repaid or refunded or
refinanced or discharged or otherwise
retired for value at the time of such
incurrence;
(viii) Indebtedness outstanding on the Initial
Issuance Date;
(ix) Indebtedness of the Company or a Restricted
Subsidiary of the Company to an Unrestricted
Subsidiary for money borrowed, provided,
that such Indebtedness is subordinated in
right of payment to the Notes and the
Weighted Average Life of such Indebtedness
is greater than the Weighted Average Life of
the Notes; and
(x) other Indebtedness not to exceed $25
million.
41
Section 4.10. Limitation on Asset Sales.
(a) The Company shall not, and shall not permit any of the
Restricted Subsidiaries of the Company to, make any Asset Disposition, unless
(i) the consideration received from such Asset Disposition is at least equal to
the Fair Market Value of the Capital Stock, property or other assets sold, (ii)
at least 75% of the consideration received from such Asset Disposition is in the
form of Cash, Temporary Cash Investments or Marketable Equity Securities (the
"75% Test"), provided that the amount of any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet or in the
notes thereto) of the Company or such Restricted Subsidiary which are assumed by
the transferee, cancelled or satisfied in any Asset Disposition (other than
liabilities that are incurred in connection with or in anticipation of such
Asset Disposition) as a credit against the purchase price therefor shall be
deemed to be Cash to the extent of the amount so credited for purposes of the
75% Test, and (iii) the Company applies, or causes its Restricted Subsidiaries
to apply, 100% of the Net Proceeds from any Asset Disposition to an offer (a
"Net Proceeds Offer") to purchase Notes outstanding having a Net Proceeds Offer
Price at least equal to such Net Proceeds, such Net Proceeds Offer to commence
on a date not later than 360 calendar days after the date of such Asset
Disposition at a purchase price (the "Net Proceeds Offer Price") equal to 100%
of the principal amount thereof, plus accrued interest thereon to the closing
date of the Net Proceeds Offer (the "Net Proceeds Purchase Date"), except to the
extent that such Net Proceeds have been applied either to the permanent
repayment of principal and interest on Senior Indebtedness or Indebtedness of
the Restricted Subsidiary of the Company that made such Asset Disposition or to
the purchase of assets or businesses in the same line of business as the Company
and its Restricted Subsidiaries or assets incidental thereto. Notwithstanding
anything to the contrary in this Section 4.10, the Company will not be required
to make a Net Proceeds Offer with respect to any Net Proceeds from Asset
Dispositions until the aggregate amount of Net Proceeds from Asset Dispositions
in any period of 12 consecutive months which are not applied either to the
permanent repayment of principal and interest on Indebtedness (as described
above) or to the purchase of assets or businesses (as described above) exceeds
$10 million. For purposes of this Section 4.10, the principal amount of Notes
for which a Net Proceeds Offer shall be made is referred to as the "Net Proceeds
Offer Amount."
(b) To the extent required by any pari passu Indebtedness, and
provided there is a permanent reduction in the principal amount of such pari
passu Indebtedness, the Company shall simultaneously with the Net Proceeds Offer
make an offer to purchase such pari passu Indebtedness (a "Pari Passu Offer") in
an amount (the "Pari Passu Offer Amount") equal to the Net Proceeds Offer
Amount, as determined above, multiplied by a fraction, the numerator of which is
the outstanding principal amount of such pari passu Indebtedness and the
denominator of which is the sum of the outstanding principal amount of the Notes
and such pari passu Indebtedness, in which case the Net Proceeds Offer Amount
shall be correspondingly reduced by such Pari Passu Offer Amount.
(c) The Company may credit against its obligation to make a
Net Proceeds Offer pursuant to this Section 4.10 up to $2 million aggregate
principal amount of Notes, at 100% of the principal amount thereof, which have
been acquired by the Company and surrendered for cancellation after the making
of the Net Proceeds Offer and which have not been used as a credit
42
against or acquired pursuant to any prior obligation to make an offer to
purchase Notes pursuant to the provisions set forth under Section 4.14 or this
Section 4.10.
(d) Upon notice of a Net Proceeds Offer provided to the
Trustee by the Company, notice of such Net Proceeds Offer shall be mailed by the
Trustee (at the Company's expense) not less than 30 calendar days nor more than
60 calendar days before the Net Proceeds Purchase Date to each Holder of Notes
at such Holder's last registered address appearing in the Register. The Company
shall provide the Trustee with copies of all materials to be delivered with such
notice. The notice shall contain all instructions and material necessary to
enable such Holders to tender Notes pursuant to the Net Proceeds Offer. In such
notice, the Company shall state: (1) that the Net Proceeds Offer is being made
pursuant to this Section 4.10 and that it will purchase the principal amount of
Notes equal to the Net Proceeds Offer Amount; (2) the Net Proceeds Offer Price
and the Net Proceeds Purchase Date; (3) that any Note not tendered will continue
to accrue interest; (4) that, unless the Company defaults in the payment of the
Net Proceeds Offer Price, all Notes accepted for payment pursuant to the Net
Proceeds Offer shall cease to accrue interest after the Net Proceeds Purchase
Date; (5) that Holders electing to have any Notes purchased pursuant to such Net
Proceeds Offer will be required to surrender the Notes, and complete the section
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes or
transfer beneficial ownership of such Notes by book-entry transfer, to the
Company, the Depositary (if appointed by the Company), or the Paying Agent at
the address specified in the notice prior to the close of business on the third
Business Day preceding the Net Proceeds Purchase Date; (6) that Holders will be
entitled to withdraw their election if the Company, the Depositary or the Paying
Agent, as the case may be, receives, not later than the close of business on the
third Business Day preceding the Net Proceeds Purchase Date, a telegram,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Notes delivered for purchase, and a statement that such
Holder is withdrawing his election to have the Notes purchased; and (7) that
Holders whose Notes are being purchased only in part will be issued new Notes
equal in principal amount to the unpurchased portion of the Notes surrendered
(or transferred by book-entry transfer), provided that the principal amount of
such unpurchased portion must be equal to $1,000 or an integral multiple
thereof. If Notes in a principal amount in excess of the Net Proceeds Offer
Amount are surrendered pursuant to the Net Proceeds Offer, the Company shall
purchase Notes on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Notes in denominations of $1,000 or
integral multiples of $1,000 shall be acquired). The Company will comply with
the requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a Net
Proceeds Offer.
(e) On the Net Proceeds Purchase Date, the Company shall (i)
accept for payment Notes or portions thereof validly tendered pursuant to the
Net Proceeds Offer (on a pro rata basis if required), (ii) deposit with the
Paying Agent money in immediately available funds, sufficient to pay the
purchase price of all Notes or portions thereof so accepted, and (iii) deliver
to the Trustee Notes so accepted together with an Officer's Certificate stating
the Notes or portions thereof accepted for payment by the Company. If the
Company complies with its obligations set forth in the immediately preceding
sentence, whether or not a Default or Event of Default has occurred and is
continuing on the Net Proceeds Purchase Date, the Paying Agent shall as promptly
as practicable mail to each Holder of Notes so accepted payment in an amount
equal to
43
the purchase price, and the Company shall execute and the Trustee shall as
promptly as practicable authenticate and mail or deliver to such Holder a new
Note equal in principal amount to any unpurchased portion of the Note
surrendered. Any Notes not so accepted shall be as promptly as practicable
mailed or delivered by the Company to the Holders thereof. The Company shall
publicly announce the results of the Net Proceeds Offer on or as promptly as
practicable after the Net Proceeds Purchase Date. For purposes of this covenant,
the Trustee shall act as the Paying Agent.
(f) Notwithstanding anything to the contrary contained in this
Indenture, the Company or any of its Restricted Subsidiaries may engage in
transactions in which theatre properties will be transferred in exchange for one
or more other theatre properties; provided that if the Fair Market Value of the
theatre properties to be transferred by the Company or such Restricted
Subsidiary, plus the Fair Market Value of any other consideration paid or
credited by the Company or such Restricted Subsidiary (the "Transaction Value")
exceeds $2 million, such transaction shall require approval of the Board of
Directors. In addition, each such transaction shall be valued at an amount equal
to all consideration received by the Company or such Restricted Subsidiary in
such transaction, other than the theatre properties received pursuant to such
exchange ("Other Consideration"), for purposes of determining whether an Asset
Disposition has occurred. If the Other Consideration is of an amount and
character such that such transaction constitutes an Asset Disposition, then
Section 4.10(a) shall be applicable to any Net Proceeds of such Other
Consideration.
Section 4.11. Limitation on Transactions with Affiliates.
The Company shall not, and shall not permit any Restricted
Subsidiary of the Company to, directly or indirectly, enter into any transaction
(including without limitation the purchase, sale, lease or exchange of any
property or the rendering of any service) with a Person that, immediately prior
to such transaction, was an Affiliate (an "Affiliate Transaction"), unless such
transaction is on terms no less favorable to the Company or such Restricted
Subsidiary than those that could be obtained in a comparable arms' length
transaction with an entity that is not an Affiliate; provided that continued
performance under agreements as in effect on the Initial Issuance Date and
described in the Offering Memorandum, or consummation, on the terms described in
the Offering Memorandum, of transactions described therein that are not
consummated prior to the Initial Issuance Date (and renewals and extensions of
such agreements and transactions on terms not materially less favorable to the
Holders than the terms of such original agreements and transactions), shall not
be subject to such limitation.
In addition, the Company shall not, and shall not permit any
of the Restricted Subsidiaries of the Company to, enter into (i) an Affiliate
Transaction involving or having an expected value of more than $2 million unless
such transaction shall have been approved in good faith by resolution of the
Board of Directors and such resolution provides that such Affiliate Transaction
complies with the requirements of this Section 4.11 or (ii) an Affiliate
Transaction involving or having an expected value of more than $15 million,
unless the Company has received an opinion of a nationally recognized
independent investment banking firm, accounting firm, appraisal firm or other
experts of nationally recognized standing if, in each case, such firm is
regularly engaged to render opinions of such type, to the effect that the
transaction is fair to the
44
Company (or, if the Company is not a party to such Affiliate Transaction, then
to such Restricted Subsidiary) from a financial point of view.
Notwithstanding anything to the contrary contained in this
Indenture, the foregoing provisions shall not apply to (i) transactions between
the Company and a Wholly Owned Subsidiary of the Company that is a Restricted
Subsidiary or between Wholly Owned Subsidiaries of the Company that are
Restricted Subsidiaries, (ii) payments required to be made to the Company by
Cinemark International or by any Subsidiary of Cinemark International under the
Cinemark International Management Agreement or under a Subsidiary management
agreement, as the case may be, (iii) payments pursuant to any tax sharing
agreement or arrangement among the Company and its Subsidiaries, (iv)
transactions with any current or former employee, officer or director of the
Company or any of its Restricted Subsidiaries pursuant to reasonable employee
benefit plans or compensation arrangements or agreements entered into in the
ordinary course of business on or prior to the Initial Issuance Date, or amended
or created thereafter with the approval of the Board of Directors, (v)
transactions with any employee of the Company pursuant to which the Company
purchases or otherwise acquires Capital Stock of the Company from such employee
as permitted under Section 4.7, or (vi) transactions constituting (A) a
Restricted Payment not prohibited by Section 4.7 and not constituting a
Permitted Investment, or (B) an investment not constituting an "Investment" by
reason of a specific exclusion from such definition.
Section 4.12. Limitation on Liens.
The Company shall not, and shall not permit any of the
Restricted Subsidiaries of the Company to, create, incur, assume or suffer to
exist any Lien upon any of its property or assets (including assets acquired
after the Initial Issuance Date), except for:
(i) Liens incurred after the Initial Issuance
Date securing Indebtedness of the Company
that ranks pari passu or junior in right of
payment to the Notes, if the Notes are
secured equally and ratably with such
Indebtedness;
(ii) Liens outstanding on the Initial Issuance
Date;
(iii) Liens for taxes, assessments, governmental
charges or claims not yet delinquent or
which are being contested in good faith by
appropriate proceedings, provided that
adequate reserves with respect thereto are
maintained on the books of the Company or
its Restricted Subsidiaries, as the case may
be, in conformity with GAAP;
(iv) Landlords' carriers', warehousemen's,
mechanics' materialmen's, repairmen's or the
like Liens arising by contract or statute in
the ordinary course of business and with
respect to amounts which are not yet
delinquent or are being contested in good
faith by appropriate proceedings;
45
(v) pledges or deposits made in the ordinary
course of business (A) in connection with
leases, performance bonds and similar
obligations, or (B) in connection with
workers' compensation, unemployment
insurance and other social security
legislation;
(vi) easements, rights-of-way, restrictions,
minor defects or irregularities in title and
other similar encumbrances which, in the
aggregate, do not materially detract from
the value of the property subject thereto or
materially interfere with the ordinary
conduct of the business of the Company or
such Restricted Subsidiary;
(vii) any attachment or judgment Lien that does
not constitute an Event of Default;
(viii) Liens securing Acquired Indebtedness,
provided that such Liens attach solely to
the acquired assets or the assets of the
acquired entity and do not extend to or
cover any other assets of the Company or any
of its Restricted Subsidiaries;
(ix) Liens to secure Senior Indebtedness;
(x) Liens in favor of the Trustee for its own
benefit and for the benefit of the
Securityholders;
(xi) any interest or title of a lessor pursuant
to a lease constituting a Capitalized Lease
Obligation;
(xii) Liens on accounts receivable and inventory
or cash deposits collateralizing
reimbursement obligations with respect to
letters of credit, in either case securing
Indebtedness permitted to be incurred under
clause (i) of Section 4.9(b);
(xiii) Liens incurred or deposits made to secure
the performance of tenders, bids, leases,
statutory or regulatory obligations,
banker's acceptances, surety and appeal
bonds, government contracts, performance and
return-of-money bonds and other obligations
of a similar nature incurred in the ordinary
course of business (exclusive of obligations
for the payment of borrowed money);
(xiv) Liens (including extensions and renewals
thereof) upon real or personal property
acquired after the Initial Issuance Date;
provided that (a) such Lien is created
solely for the purpose of securing
Indebtedness incurred, in accordance with
Section 4.9, (1) to finance the cost
(including the cost of improvement or
construction) of the item of property or
assets subject thereto and such Lien is
created prior to, at the time of or within
six months after the later of the
acquisition, the completion of construction
or the commencement of full operation of
such property or (2) to
46
refinance any Indebtedness previously so
secured, (b) the principal amount of the
Indebtedness secured by such Lien does not
exceed 100% of such cost and (c) any such
Lien shall not extend to or cover any
property or assets other than such item of
property or assets and any improvements on
such item;
(xv) leases or subleases granted to others that
do not materially interfere with the
ordinary course of business of the Company
and its Restricted Subsidiaries, taken as a
whole;
(xvi) Liens encumbering property or assets under
construction arising from progress or
partial payments by a customer of the
Company or its Restricted Subsidiaries
relating to such property or assets;
(xvii) any interest or title of a lessor in the
property subject to any Capitalized Lease
obligation or operating lease;
(xviii) Liens arising from filing Uniform Commercial
Code financing statements regarding leases;
(xix) Liens on property of, or on shares of stock
or Indebtedness of, any Person existing at
the time such Person becomes, or becomes a
part of, any Restricted Subsidiary, provided
that such Liens do not extend to or cover
any property or assets of the Company or any
Restricted Subsidiary other than the
property or assets acquired;
(xx) Liens in favor of the Company or any
Restricted Subsidiary;
(xxi) Liens in favor of customs and revenue
authorities arising as a matter of law to
secure payment of customs duties in
connection with the importation of goods;
(xxii) Liens encumbering deposits securing
Indebtedness under Hedging Obligations;
(xxiii) Liens arising out of conditional sale, title
retention, consignment or similar
arrangements for the sale of goods entered
into by the Company or any of its Restricted
Subsidiaries in the ordinary course of
business in accordance with the past
practices of the Company and its Restricted
Subsidiaries;
(xxiv) Liens on or sales of receivables;
(xxv) the rights of film distributors under film
licensing contracts entered into by the
Company or any of its Restricted
Subsidiaries in the ordinary course of
business on a basis customary in the movie
exhibition industry; and
47
(xxvi) any renewal of or substitution for any Liens
permitted by any of the preceding clauses,
provided that the Indebtedness secured is
not increased (other than by any premium and
accrued interest, plus customary fees,
expenses and costs related to such renewal
or substitution of Liens or the incurrence
of any related refinancing of Indebtedness)
nor the Liens extended to any additional
assets (other than proceeds and accessions).
The provisions of this Section 4.12 do not authorize the
incurrence of any Indebtedness not otherwise permitted by Section 4.9.
Section 4.13. Limitation on Layering Debt.
The Company will not incur, create, issue, assume, guarantee
or otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to any Senior Indebtedness of the Company but senior in any
respect in right of payment to the Notes.
Section 4.14. Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company
shall be required to make an offer (a "Change of Control Offer") to Holders to
repurchase any and all of the Notes (but only in denominations of $1,000 or
integral multiples of $1,000) at a purchase price (the "Change of Control Offer
Price") equal to 101% of the aggregate principal amount, plus accrued and unpaid
interest thereon to the date of purchase ("Change of Control Purchase Date").
(b) Notice of a Change of Control Offer shall be mailed by the
Company, with a copy to the Trustee, or, at the Company's option, by the Trustee
(at the Company's expense) not more than 30 calendar days after the Change of
Control to each Holder of the Notes at such Holder's last registered address
appearing in the Register. In such notice, the Company shall describe the
transaction that constitutes the Change of Control and offer to repurchase Notes
pursuant to the procedures required by this Section 4.14 and described in such
notice. The notice shall contain all instructions and materials necessary to
enable Holders to tender Notes pursuant to the Change of Control Offer. In
addition, the notice shall state: (1) that the Change of Control Offer is being
made pursuant to this Section 4.14 and that all Notes tendered will be accepted
for payment; (2) the Change of Control Offer Price and the Change of Control
Purchase Date, which shall be no sooner than 60 nor later than 90 days after the
Change of Control; (3) that any Note not tendered will continue to accrue
interest; (4) that, unless the Company defaults in the payment of the Change of
Control Offer Price, all Notes accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of Control
Purchase Date; (5) that Holders electing to have any Notes purchased pursuant to
a Change of Control Offer will be required to deliver the Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, or transfer by book-entry transfer, to the Company, the Depositary
(if appointed by the Company), or the Paying Agent at the address specified in
the notice prior to the close of business on the third Business Day preceding
the Change of Control Purchase Date; (6) that Holders will be entitled to
withdraw their election if the Company, the Depositary or the Paying Agent, as
the case may be, receives, not later than the close of business on the third
Business Day preceding the Change of Control Purchase Date, a
48
telegram, facsimile transmission or letter setting forth the name of the Holder,
the principal amount of Notes delivered for purchase, and a statement that such
Holder is withdrawing his election to have the Notes purchased; and (7) that
Holders whose Notes are being purchased only in part will be issued new Notes
equal in principal amount to the unpurchased portion of the Notes surrendered
(or transferred by book-entry transfer), which unpurchased portion must be equal
to at least $1,000 in principal amount or an integral multiple thereof. The
Company will comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such laws
and regulations are applicable in connection with the repurchase of the Notes as
a result of a Change of Control.
(c) On the Change of Control Purchase Date, the Company shall
(i) accept for payment Notes or portions thereof validly tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent money in
immediately available funds sufficient to pay the purchase price of all Notes or
portions thereof so accepted, and (iii) deliver to the Trustee Notes so accepted
together with an Officer's Certificate stating the Notes or portions thereof
accepted for payment by the Company. If the Company complies with its
obligations set forth in the immediately preceding sentence, whether or not a
Default or Event of Default has occurred and is continuing on the Change of
Control Purchase Date, the Paying Agent shall as promptly as practicable mail or
deliver to each Holder of Notes so accepted payment in an amount equal to the
purchase price, and the Company shall execute and the Trustee shall as promptly
as practicable authenticate and mail or deliver to such Holder a new Note equal
in principal amount to any unpurchased portion of the Note surrendered, if any;
provided that each such new Note will be in a principal amount of $1,000 or an
integral multiple thereof. Any Notes not so accepted shall be as promptly as
practicable mailed or delivered by the Trustee to the Holders thereof. The
Company shall publicly announce the results of the Change of Control Offer on or
as promptly as practicable after the Change of Control Purchase Date. For
purposes of this Section 4.14, the Trustee shall act as the Paying Agent.
(d) Prior to complying with the other provisions of this
Section 4.14, but in any event within 90 days following a Change of Control, the
Company shall either repay all outstanding Senior Indebtedness or obtain the
requisite consents, if any, under all agreements governing outstanding Senior
Indebtedness to permit the repurchase of Notes required by this Section 4.14.
Section 4.15. Corporate Existence.
Except as otherwise permitted pursuant to the terms hereof,
the Company shall do or cause to be done all things necessary to preserve and
keep in full force and effect (i) its corporate existence, and the corporate,
partnership or other existence of each of its Significant Subsidiaries, in
accordance with their respective organizational documents (as the same may be
amended from time to time), and (ii) the material rights (charter and
statutory), licenses and franchises of the Company and its Significant
Subsidiaries; provided, however, that the Company shall not be required to
preserve any such right, license or franchise of itself or any of its
Significant Subsidiaries, or the corporate, partnership or other existence of
any of its Significant Subsidiaries, if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders of the Notes.
49
Section 4.16. Covenant with Respect to Cinemark International and its
Subsidiaries.
The Company shall cause Cinemark International and its
Subsidiaries on a consolidated basis to be engaged principally in the
acquisition, construction and operation of indoor motion picture theatres and
other activities incidental thereto outside the United States and Canada.
ARTICLE 5
SUCCESSORS
Section 5.1. Merger, Consolidation, or Sale of Assets.
The Company shall not consolidate with or merge with or into,
or sell, assign or lease all or substantially all of the properties and assets
of the Company and its Restricted Subsidiaries, taken as a whole, to any Person
(other than the Company or a Wholly Owned Subsidiary of the Company that is a
Restricted Subsidiary), or permit any Person (other than a Wholly Owned
Subsidiary of the Company that is a Restricted Subsidiary) to merge with or into
the Company unless:
(i) the Company shall be the continuing Person,
or the Person formed by such consolidation
or into which the Company is merged or to
which the properties and assets of the
Company and its Restricted Subsidiaries
taken as a whole are transferred (the
"surviving entity") shall be a corporation
organized and existing under the laws of the
United States or any state thereof or the
District of Columbia and shall expressly
assume, by a supplemental indenture,
executed and delivered to the Trustee, in
form satisfactory to the Trustee, all the
obligations of the Company under the Notes
and the Indenture, and the Indenture shall
remain in full force and effect;
(ii) immediately before and immediately after
giving effect to such transaction, no Event
of Default and no Default shall have
occurred and be continuing;
(iii) unless the applicable transaction involves
the merger of a Restricted Subsidiary of the
Company into the Company, the Company or, in
the case of a consolidation or merger in
which the Company is not the continuing
Person, the surviving entity, after giving
pro forma effect to such transaction, could
incur $1.00 of additional Indebtedness
(assuming a market rate of interest with
respect to such additional Indebtedness)
pursuant to Section 4.9(a); and
(iv) unless the applicable transaction involves
the merger of a Restricted Subsidiary of the
Company into the Company, immediately after
giving effect to such transaction, the
Consolidated Net Worth of the Company, or,
in the case of a
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consolidation or merger in which the Company
is not the continuing Person, the surviving
entity, shall be equal to or greater than
the Consolidated Net Worth of the Company
immediately before such transaction.
Section 5.2. Successor Company Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company and its Restricted Subsidiaries
taken as a whole in accordance with Section 5.1 hereof, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such transfer is made, shall succeed to, and be substituted for, and
may exercise every right and power of the Company under the Indenture with the
same effect as if such successor corporation had been named as the Company
therein; and thereafter, if the Company is dissolved following a transfer of all
or substantially all of its assets in accordance with this Indenture, the
Company shall be discharged and released from all obligations and covenants
under this Indenture and the Notes. The Trustee shall enter into a supplemental
indenture to evidence the succession and substitution of such successor Person
and such discharge and release of the Company.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.1. Events of Default.
An "Event of Default" occurs if one of the following shall
have occurred and be continuing:
(a) the Company defaults in the payment of (i) the principal
of (or premium, if any, on) any Notes when the same becomes due and payable at
maturity, by acceleration or otherwise, (ii) the redemption price on any
redemption date, or (iii) the Change of Control Offer Price or the Net Proceeds
Offer Price on the applicable Offer Purchase Date relating to such Offer;
(b) the Company defaults in the payment of interest on any
Note when the same becomes due and payable, which default continues for a period
of 30 calendar days;
(c) the Company or any Subsidiary of the Company fails to
comply with any of its covenants or agreements in the Notes or this Indenture
(other than those referred to in clauses (a) and (b) above) and such failure
continues for 45 calendar days after receipt by the Company of a Notice of
Default specifying such Default;
(d) an event of default on any other Indebtedness for borrowed
money of the Company or any of its Restricted Subsidiaries having an aggregate
amount outstanding in excess of $5 million which default (i) is caused by a
failure to pay when due (after giving effect to any grace periods) any
principal, premium, if any, or interest on such Indebtedness or (ii) has caused
the holders thereof to declare such Indebtedness due and payable in advance of
its scheduled maturity;
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(e) the Company or any Significant Subsidiary of the Company
pursuant to or within the meaning of any Bankruptcy Law: (i) commences a
voluntary case or proceeding, (ii) consents to the entry of an order for relief
against it in an involuntary case or proceeding, (iii) consents to the
appointment of a Custodian of it or for all or substantially all of its
property, (iv) makes a general assignment for the benefit of its creditors, or
(v) admits in writing its inability to pay its debts generally as they become
due;
(f) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that: (i) is for relief against the Company or
any Significant Subsidiary of the Company in an involuntary case or proceeding,
(ii) appoints a Custodian of the Company or any Significant Subsidiary of the
Company or for all or substantially all of its respective properties, or (iii)
orders the liquidation of the Company or any Significant Subsidiary of the
Company; and in each case the order or decree remains unstayed and in effect for
60 calendar days; or
(g) final non-appealable judgments for the payment of money
which in the aggregate exceed $5 million (net of applicable insurance coverage
which is acknowledged in writing by the insurer) shall be rendered against the
Company or any Significant Subsidiary of the Company by a court and shall remain
unstayed or undischarged for a period of 60 calendar days.
A Default under clause (c) above is not an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25% in
aggregate principal amount of the Notes at the time outstanding notify the
Company and the Trustee, of the Default and the Company does not cure such
Default within 45 days after receipt of such notice. Such notice must be in
writing and specify the Default, demand that it be remedied and state that the
notice is a "Notice of Default.'
Notwithstanding the foregoing, if an Event of Default
specified in clause (d) above occurs and is continuing, such Event of Default
and all consequences thereof (including, without limitation, any acceleration or
resulting payment default) shall be annulled and rescinded, automatically and
without any action by the Trustee or the holders of the Notes, if (i) the
Indebtedness that is the subject of such Event of Default has been repaid, or
(ii) the default relating to such Indebtedness is waived or cured (and if such
Indebtedness has been accelerated, then the holders thereof have rescinded their
declaration of acceleration in respect of such Indebtedness).
Section 6.2. Acceleration.
If any Event of Default specified in clauses (a), (b), (c),
(d) or (g) of Section 6.1 hereof occurs and is continuing, then the Holders of
at least 25% in aggregate principal amount of the then outstanding Notes by
written notice to the Company and the Trustee may declare the unpaid principal
of, and any accrued interest on, all the Notes to be due and payable
immediately. If any Event of Default with respect to the Company specified in
clauses (e) or (f) of Section 6.1 hereof occurs, all outstanding principal and
interest on the Notes shall be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder. The Holders
of a majority in aggregate principal amount of the Notes then outstanding, by
written notice to the Trustee and to the Company, may rescind an acceleration
52
(except an acceleration due to a default in payment of the principal of, or
premium or interest on, any of the Notes) if the rescission would not conflict
with any judgment or decree and if all existing Events of Default (except
nonpayment of principal, premium or interest that have become due solely because
of the acceleration) have been cured or waived.
Section 6.3. Other Remedies.
Subject to Section 6.2, if an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect any payment due on the Notes or to enforce the performance
of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder of a Note 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. All remedies
are cumulative to the extent permitted by law.
Section 6.4. Waiver of Past Defaults.
Subject to Section 9.2, Holders of a majority in aggregate
principal amount of the then outstanding Notes by notice to the Trustee may, on
behalf of the Holders of all of the Notes, waive an existing Default or Event of
Default and its consequences hereunder (including without limitation
acceleration and its consequences, including any related payment default that
resulted from such acceleration). Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
Section 6.5. Control by Majority.
The Holders of a majority in aggregate principal amount of the
Notes then outstanding may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. However, the Trustee may refuse to follow any direction
that conflicts with law or this Indenture or that the Trustee determines may be
unduly prejudicial to the rights of another Holder or that involves the Trustee
in personal liability. The Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction.
Section 6.6. Limitation on Suits.
Subject to the provisions of Section 6.7 hereof, no Holder of
a Note may pursue any remedy with respect to this Indenture or the Notes
(including without limitation the institution of any proceeding, judicial or
otherwise, with respect to the Notes or this Indenture or for the appointment of
a receiver or trustee for the Company and/or any of its Subsidiaries) unless:
(a) the Holder has given to the Trustee written notice of a
continuing Event of Default;
53
(b) the Holders of at least 25% in aggregate principal amount
of the Notes then outstanding have made a written request to the Trustee to
pursue the remedy;
(c) such Holders have offered to provide to the Trustee
indemnity reasonably satisfactory to the Trustee against any loss, liability or
expense;
(d) the Trustee has not complied with the request within 60
calendar days after receipt of the request and the offer of indemnity; and
(e) during such 60-day period, the Holders of a majority in
aggregate principal amount of the Notes then outstanding have not given the
Trustee a direction which, in the opinion of the Trustee, is inconsistent with
the request.
A Holder of a Note may not use this Indenture to prejudice the
rights of another Holder of a Note or to obtain a preference or priority over
another Holder of a Note.
Section 6.7. Rights of Holders of Notes to Receive Payment.
The right of any Holder of a Note to receive payment of
principal of, and premium, if any, and interest on, the Note, on or after the
respective due dates expressed in the Note (including in connection with an
offer to purchase), 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 6.8. Collection Suit by Trustee.
If an Event of Default specified in Section 6.1(a) or (b)
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company for principal
of, and premium, if any, and interest on, the Notes and interest on overdue
principal and, to the extent lawful, interest, and such further amount as shall
be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
Section 6.9. Trustee May File Proofs of Claim.
The Trustee is authorized to 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 (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders of the Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes), its creditors or its property and
shall be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.7 hereof. To the extent that the payment of any such
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other
54
amounts due the Trustee under Section 7.7 hereof out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a Lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties that the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.7 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium, if any, and interest ratably, without preference
or priority of any kind, according to the amounts due and payable on the Notes
for principal, premium, if any, and interest, respectively; and Third: the
remainder to the Company or to such party as a court of competent jurisdiction
shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Notes pursuant to this-Section 6.10.
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 a Trustee, each party to this Indenture agrees, and each Holder
by its acceptance of its Notes shall be deemed to have agreed, that any 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 of a Note pursuant to Section 6.7
hereof, or a suit by Holders of more than 10% in principal amount of the then
outstanding Notes.
ARTICLE 7
TRUSTEE
Section 7.1. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of
55
care and skill in its exercise, as a prudent Person would exercise or use under
the circumstances in the conduct of its own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee shall not be liable hereunder
except for such duties of the Trustee which
shall be determined solely by the express
provisions of this Indenture and the Trustee
need perform only those duties that are
specifically set forth in this Indenture and
no others, and no implied covenants or
obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the
truth of the statements and the correctness
of the opinions expressed therein, upon
certificates or opinions furnished to the
Trustee and conforming to the requirements
of this Indenture. However, the Trustee
shall examine the certificates and opinions
to determine whether or not such documents
conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section;
(ii) the Trustee shall not be liable for any
error of judgment made in good faith by a
Responsible Officer, unless it is proved
that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) 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 6.5
hereof.
(d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section 7.1.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability whatsoever in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers hereunder. The Trustee shall be under no obligation to exercise
any of its rights and powers under this Indenture at the request of any Holders,
unless such Holder shall have offered to the Trustee security and indemnity
satisfactory to it in its sole subjective discretion (which discretion shall be
exercised in good faith) against any loss, liability or expense.
56
(f) 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.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
Section 7.2. Rights of Trustee.
(a) Subject to Section 7.1, the Trustee may conclusively rely
upon 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.
(b) Before the Trustee acts or refrains from acting, it may
consult with counsel and require an Officers' Certificate or an opinion of
Counsel or both. The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such officers, Certificate or opinion
of Counsel.
(c) The Trustee may act through its attorneys and 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 in its sole subjective discretion
(which discretion shall be exercised in good faith) to be authorized or within
the rights or powers conferred upon it by this Indenture.
(e) The permissive right of the Trustee to act hereunder shall
not be construed as a duty.
(f) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(g) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee security or indemnity satisfactory to the Trustee in its sole subjective
discretion (which discretion shall be exercised in good faith) against the
costs, expenses and liabilities that might be incurred by it in compliance with
such request or direction.
(h) The Trustee shall not be required to take notice or deemed
to have notice of any Event of Default hereunder, except failure by the Company
to make any of the payments to the Trustee pursuant to Section 6.1(a) or Section
6.1(b) hereof, unless the Trustee shall be specifically notified in writing of
such Event of Default by the Company or by one or more of the Holders.
Section 7.3. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest (as such term is defined in TIA Section 310(b)), it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
(to
57
the extent permitted under TIA Section 310(b)) or resign. Any Agent may do the
same with like rights and duties. The Trustee is also subject to Sections 7.10
and 7.11 hereof.
Section 7.4. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.
Section 7.5. 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 Holders of Notes a
notice of the Default or Event of Default within 90 days after such event
occurs. Except in the case of a Default or Event of Default under Section 6.1(a)
or (b), the Trustee may withhold such notice if it determines that withholding
the notice is in the interests of the Holders of the Notes.
Section 7.6. Reports by Trustee to Holders of the Notes.
Within 60 days after each July 31 beginning with the July 31
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee shall mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA Section 313 (a) (but if
no event described in TIA Section 313 (a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with TIA Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the
Holders of Notes shall be mailed to the Company and filed with the SEC and each
stock exchange, if any, on which the Notes are listed in accordance with and to
the extent required by TIA Section 313(d)- The Company shall promptly notify the
Trustee if the Notes become listed on any stock exchange or automatic quotation
system.
Section 7.7. Compensation and Indemnity.
Absent any other agreement to the contrary, the Company shall
pay to the Trustee from time to time compensation as shall be agreed upon
between the Company and the Trustee for its acceptance of this Indenture and
services hereunder. 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 promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
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The Company shall indemnify the Trustee against any and all
losses, liabilities or expenses incurred by it arising out of or in connection
with the acceptance or administration of its duties under this Indenture,
including the costs and expenses of enforcing this Indenture against the Company
(including this Section 7.7) and defending itself against any claim (whether
asserted by the Company or any Holder or any other Person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such loss, liability or expense may be
attributable to its negligence or bad faith. The Trustee shall promptly notify
the Company of any claim for which it may seek indemnity. The Company shall
defend the claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel and the Company shall pay the reasonable fees and expenses
of such counsel; provided that the Company will not be required to pay such fees
and expenses if it assumes the Trustee's defense with counsel acceptable to and
approved by the Trustee (such approval not to be unreasonably withheld) and
there is no conflict of interest between the Company and the Trustee in
connection with such defense. The Company need not pay for any settlement made
without its written consent, which consent shall not be unreasonably withheld.
The Company need not reimburse the Trustee for any expense or indemnity against
any liability or loss of the Trustee to the extent such expense, liability or
loss is attributable to the negligence, bad faith or willful misconduct of the
Trustee.
The obligations of the Company under this Section 7.7 shall
survive the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.1(e) or (f) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration under
any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section
313(b)(2).
Section 7.8. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustees
acceptance of appointment as provided in this Section.
The Trustee may resign in writing upon 60 days notice and be
discharged from the trust hereby created by so notifying the Company in writing.
The Holders of Notes of a majority in principal amount of the then outstanding
Notes may remove the Trustee by so notifying the Trustee and the Company in
writing and may appoint a successor trustee with the consent of the Company. The
Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
59
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a receiver, Custodian or public officer takes charge of
the Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint or
request the Trustee to appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the then outstanding Notes may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of Notes of at least 10$ in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note
who has been a Holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of 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 Holders of the Notes. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.7 hereof. Notwithstanding replacement of the Trustee pursuant
to this Section 7.8, the Company's obligations under Section 7.7 hereof shall
continue for the benefit of the retiring Trustee.
Section 7.9. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $100 million as set forth in its most recent published annual report of
condition.
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This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
DEFEASANCE AND DISCHARGE
Section 8.1. Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any time,
elect to have either Section 8.2 or 8.3 hereof be applied to all outstanding
Notes upon compliance with the conditions set forth below in this Article 8.
Section 8.2. Legal Defeasance.
Upon the Company's exercise under Section 8.1 hereof of the
option applicable to this Section 8.2, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.4 hereof, be deemed to
have been discharged from its obligations with respect to all outstanding Notes
on the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.6 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged pursuant to this Indenture: (a) the
rights of Holders of outstanding Notes to receive solely from the trust fund
described in Section 8.4 hereof, and as more fully set forth in such Section,
payments in respect of the principal of, and premium, if any, and interest on,
such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.2 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article 8. Subject to
compliance with this Article 8, the Company may exercise its option under this
Section 8.2 notwithstanding the prior exercise of its option under Section 8.3
hereof.
Section 8.3. Covenant Defeasance.
Upon the Company's exercise under Section 8.1 hereof of the
option applicable to this Section 8.3, and subject to the satisfaction of the
conditions set forth in Section 8.4 hereof, the Company shall be released from
its obligations under the covenants contained in Sections 4.4, 4.5, 4.7, 4.8,
4.9, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 5.1, and 5.2 with respect to the
outstanding Notes on and after the date the conditions set forth below are
satisfied (hereinafter,
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"Covenant Defeasance"), and the Notes shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or declaration
or act of Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed "outstanding" for all other purposes
hereunder (it being understood that such Notes shall not be deemed outstanding
for accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Notes, the Company may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in
any such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 6.1 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.1 hereof of the option applicable to this
Section 8.3 hereof, subject to the satisfaction of the conditions set forth in
Section 8.4 hereof, Sections 6.1(c) through 6.1(g) hereof shall not constitute
Events of Default.
Section 8.4. Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant
Defeasance, the Company must irrevocably deposit, or caused to be deposited,
with the Trustee (or another trustee satisfying the requirements of this
Indenture), in trust for such purpose, (1) money in an amount, (2) U.S.
Government Obligations which through the payment of principal and interest in
accordance with their terms will provide money in an amount, or (3) 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 the principal of, and premium, if any, and
interest on, the outstanding Notes at maturity or upon redemption, together with
all other amounts payable by the Company under the Indenture. Such Legal
Defeasance or Covenant Defeasance will become effective 91 days after such
deposit if and only if:
(i) no Default or Event of Default with respect
to the Notes shall have occurred and be
continuing immediately prior to the time of
such deposit;
(ii) no Default or Event of Default pursuant to
Sections 6.1(e) or 6.1 (f) shall have
occurred at any time in the period ending on
the 91st day after the date of such deposit
and shall be continuing on such 91st day;
(iii) such defeasance does not result in a breach
or violation of, or constitute a default
under, any other agreement or instrument to
which the Company is a party or by which it
is bound (and, in furtherance of such
condition, no Default or Event of Default
shall result under this Indenture due to the
incurrence of Indebtedness to fund such
deposit and the entering into of customary
documentation in connection therewith, even
though such documentation may contain
provisions that would otherwise give rise to
a Default or Event of Default); and
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(iv) the Company has delivered to the Trustee
(A)(1) in the case of Legal Defeasance, an
opinion of Counsel to the effect that (x)
there has been published by the Internal
Revenue Service a ruling or (y) since the
date of this Indenture, there has been a
change in the applicable federal income tax
law, in either case to the effect that, and
based thereon such Opinion of Counsel shall
confirm that, the Holders of the Notes will
not recognize income, gain or loss for
federal income tax purposes as a result of
such Legal 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 Legal
Defeasance had not occurred, or (2) in the
case of Covenant Defeasance, an Opinion of
Counsel to the effect that the Holders of
the Notes 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
amount, in the same manner and at the same
times as would have been the case if such
Covenant Defeasance had not occurred; and
(B) an Officers' Certificate and an Opinion
of Counsel, each stating that all conditions
precedent relating to such Legal Defeasance
or Covenant Defeasance have been complied
with.
Section 8.5. Discharge.
If (i) the Company shall deliver to the Trustee for
cancellation all Notes theretofore authenticated and delivered (other than any
Notes which shall have been destroyed, lost or stolen and in lieu of or in
substitution for which other Notes shall have been authenticated and delivered)
and not theretofore cancelled, or (ii) all Notes not theretofore surrendered or
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be called
for redemption within one year under arrangements satisfactory to the Trustee,
and the Company shall irrevocably deposit with the Trustee, as trust funds
solely for the benefit of the Holders for that purpose, an amount sufficient to
pay at maturity or upon redemption all of the Notes (other than any Notes which
shall have been destroyed, lost or stolen and in lieu of or in substitution for
which other Notes shall have been authenticated and delivered) not theretofore
surrendered or delivered to the Trustee for cancellation, including principal,
premium, if any, and interest due or to become due to such date of maturity or
redemption date, as the case may be, then this Indenture shall cease to be of
further force or effect (except as to rights of registration of transfer or
exchange of the Notes provided in this Indenture) and, at the written request of
the Company, accompanied by an Officer's Certificate and Opinion of Counsel,
each stating that all conditions precedent provided for herein relating to the
satisfaction and discharge of this Indenture have been complied with, and upon
payment of the costs, charges and expenses incurred or to be incurred by the
Trustee in relation thereto or in carrying out the provisions of this Indenture,
the Trustee shall satisfy and discharge this Indenture ("Discharge"); provided
that the Company's obligations with respect to the payment of principal,
premium, if any, and interest will not terminate until the same shall apply the
moneys so deposited to the payment to the Holders of Notes of all sums due and
to become due thereon.
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Section 8.6. Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.7 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.6, the
"Trustee") pursuant to Section 8.4 or 8.5 hereof in respect of the outstanding
Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company or any of its Subsidiaries or
Affiliates acting as Paying Agent) as the Trustee may determine, to the Holders
of such Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest but such money need not be segregated from other
funds except to the extent required by law.
The company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the cash or U.S.
Government Obligations deposited pursuant to this Section 8.6 or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the company any money or U.S. Government Obligations held by it as
provided in this Section 8.6 which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.4 hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance, Covenant
Defeasance or Discharge.
Section 8.7. Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company or any of its Subsidiaries or Affiliates, in trust for
the payment of the principal of, or premium, if any, or interest on, any Note
and remaining unclaimed for one year after such principal, premium, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company or any of its Subsidiaries or Affiliates) shall
be discharged from such trust; and the Holder of such Note shall thereafter, as
an unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company or any of its Subsidiaries or Affiliates
as trustee thereof, shall thereupon cease; provided, however, that the Trustee
or such Paying Agent, before being required to make any such repayment, may at
the expense of the Company cause to be published once, in the New York Times and
The Wall Street Journal (national edition), notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such notification or publication, any unclaimed balance
of such money then remaining will be repaid to the Company.
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Section 8.8. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United
States dollars or U.S. Government Obligations in accordance with Section 8.2,
8.3 or 8.5 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 8.2, 8.3 or 8.5 hereof until such time as the Trustee or Paying Agent
is permitted to apply all such assets in accordance with Section 8.2, 8.3 or 8.5
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, or premium, if any, or interest on, any Note following
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money held
by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.1. Without Consent of Holders of Notes.
Notwithstanding Section 9.2 of this Indenture, the Company and
the Trustee may amend or supplement this Indenture or the Notes without the
consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(c) to provide for the assumption of the Company's obligations
to the Holders of Notes in the case of a merger or consolidation pursuant to
Article 5 hereof;
(d) to make any change that would provide any additional
rights or benefits to the Holders of the Notes or that does not adversely affect
the legal rights hereunder of any such Holder; or
(e) to comply with requirements of the SEC in order to effect
or maintain the qualification of this Indenture under the TIA as then in effect.
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing --the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.2 hereof, the Trustee shall join with the Company in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
Section 9.2. With Consent of Holders of Notes.
Except as provided below in this Section 9.2, the Indenture or
the Notes may be amended or supplemented with the consent of the Holders of at
least a majority in principal
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amount of the Notes then outstanding (including, without limitation, consents
obtained in connection with a purchase of, or tender offer or exchange offer
for, Notes), and, subject to Sections 6.4 and 6.7 and the last sentence of
Section 6.1 hereof, any existing Default or Event of Default (other than a
Default or Event of Default in the payment of principal of, premium, if any, or
interest on, the Notes, except a payment default resulting from an acceleration
that has been rescinded) or compliance with any provision of this Indenture or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for Notes).
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.2
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that adversely
affects its own rights, duties, liabilities or immunities under this Indenture
or otherwise.
It shall not be necessary for the consent of the Holders of
Notes under this Section 9.2 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
9.2 becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.4 and 6.7 hereof, the
Holders of a majority in principal amount of the Notes then outstanding may
waive compliance in a particular instance by the company with any provision of
this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment or waiver may not (with respect to any Notes held by a
non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of
any Note or alter the provisions with respect to the redemption of the Notes;
(c) reduce the rate of or change the time for payment of
interest on any Note;
(d) waive a Default or Event of Default in the payment of
principal of, or premium, if any, or interest on, the Notes (except a rescission
of acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration);
(e) make any Note payable in money other than that stated in
the Notes;
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(f) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of, premium, if any, or interest on, the Notes;
(g) waive a redemption payment with respect to any Note; or
(h) make any change in the foregoing amendment and waiver
provisions.
In addition, any amendment to the provisions of Article 10 of
this Indenture requires the consent of the Holders of at least 66-2/3% in
aggregate principal amount of the Notes then outstanding if such amendment would
adversely affect the rights of Holders of the Notes.
Section 9.3. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes
shall be set forth in an amended or supplemental Indenture that complies with
the TIA as then in effect.
Section 9.4. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by the Holder of a
Note and every subsequent Holder of a Note or portion of a Note that evidences
the same debt as the consenting Holders Note, even if notation of the consent is
not made on any Note. However, any such Holder of a Note or subsequent Holder of
a Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment has
been approved by the requisite Holders. An amendment, supplement or waiver
becomes effective when approved by the requisite Holders and executed by the
Trustee (or, if otherwise provided in such waiver, supplement or amendment, in
accordance with its terms) and thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then notwithstanding
the last sentence of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such amendment or waiver or revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No consent shall be valid or effective for more than 90
days after such record date except to the extent that the requisite number of
consents to the amendment, supplement or waiver have been obtained within such
90-day period or as set forth in the next paragraph of this Section 9.4.
After an amendment, supplement or waiver becomes effective, it
shall bind every Holder, unless it makes a change described in any of clauses
(a) through (h) of Section 9.2, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same
indebtedness as the consenting Holder's Note.
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Section 9.5. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue, and the Trustee shall authenticate,
new Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.6. Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
In executing any amended or supplemental indenture, the Trustee shall be
entitled to receive and (subject to Section 7.1) shall be fully protected in
relying upon, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
Section 9.7. Payments for Consent.
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder of
any Notes for or as an inducement to any consent, waiver or amendment of any
terms or provisions of the Notes unless such consideration is offered to be paid
or agreed to be paid to all Holders of the Notes which so consent, waive or
agree to amend in the time frame set forth in solicitation documents relating to
such consent, waiver or agreement.
ARTICLE 10
SUBORDINATION
Section 10.1. Agreement to Subordinate.
The Company agrees, and each Holder by accepting a Note
agrees, that the payment of principal of, and premium, if any, and interest on,
and other Obligations evidenced by, the Notes is subordinated in right of
payment, to the extent and in the manner provided in this Article 10, to the
prior payment in full of all Senior Indebtedness (whether outstanding on the
date hereof or hereafter incurred), and that the subordination is for the
benefit of the holders of Senior Indebtedness.
Section 10.2. Liquidation; Dissolution; Bankruptcy.
Upon any distribution to creditors of the Company in a
liquidation or dissolution of the Company or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Company or its
property, an assignment for the benefit of creditors or any marshalling of the
Company's assets and liabilities:
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(1) holders of Senior Indebtedness shall be entitled to
receive payment in full in Cash (or U.S. dollar- denominated Cash
Equivalents) of all Obligations due in respect of such Senior
Indebtedness (including interest after the commencement of any such
proceeding at the rate specified in the applicable Senior Indebtedness)
before the Holders of Notes shall be entitled to receive any payment of
any kind or character with respect to the Notes; and
(2) until all Obligations with respect to Senior Indebtedness
are paid in full in Cash (or U.S. dollar- denominated Cash
Equivalents), any distribution to which the Holders of Notes would be
entitled but for this Article 10 shall be made to the holders of such
Senior Indebtedness.
Notwithstanding the foregoing, Holders of Notes may receive
(i) securities that are subordinated at least to the same extent as the Notes to
Senior Indebtedness and any securities issued in exchange for Senior
Indebtedness and (ii) payments made from the trusts described in Sections 8.4
and 8.5 hereof.
Section 10.3. Default on Designated Senior Indebtedness.
The Company may not make any payment of any kind or character
upon or in respect of the Notes (other than in (i) securities that are
subordinated to the same extent as the Notes to Senior Indebtedness and any
securities issued in exchange for Senior Indebtedness and (ii) payments made
from the trusts described in Sections 8.4 and 8.5 hereof) if:
(i) a default in the payment of the principal of, premium, if
any, or interest on Designated Senior Indebtedness occurs and is
continuing; or
(ii) any other default occurs and is continuing with respect
to Designated Senior Indebtedness that permits holders of the
Designated Senior Indebtedness as to which such default relates to
accelerate its maturity and the Trustee receives a notice of such
default (a "Payment Blockage Notice") from the Company or the holders
of any Designated Senior Indebtedness.
Payments on the Notes may and shall be resumed:
(a) in the case of default referred to in Section 10.3(i),
upon the date on which such default is cured or waived, and
(b) in case of a default referred to in Section 10.3(ii), upon
the earlier of (i) the date on which such default is cured or waived or (ii) 179
days after the date on which the applicable Payment Blockage Notice is received
by the Trustee (unless the maturity of any Designated Senior Indebtedness has
been accelerated or unless the provisions of this Article 10 otherwise do not
permit such payment).
In no event shall more than one period of payment blockage be
made in any 360 consecutive day period. No nonpayment default that existed or
was continuing on the date of receipt by the Trustee of any Payment Blockage
Notice shall be, or be made, the basis for a subsequent Payment Blockage Notice.
Following the expiration of any period during which the
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Company is prohibited from making payments on the Notes pursuant to a Payment
Blockage Notice, the Company will be obligated to resume making any and all
required payments in respect of the Notes, including without limitation any
missed payments.
Section 10.4. Acceleration of Notes.
The Company and the Trustee shall promptly notify holders of
Designated Senior Indebtedness if payment on the Notes is accelerated because of
an Event of Default.
Section 10.5. When Distribution Must Be Paid Over.
In the event that the Trustee or any Holder receives any
payment of any obligations with respect to the Notes at a time when the Trustee
or such Holder, as applicable, has actual knowledge that such payment is
prohibited by Section 10.3 hereof, such payment shall be held by the Trustee or
such Holder, in trust for the benefit of and, upon written request, shall be
paid forthwith over and delivered to, the holders of Senior Indebtedness as
their interests may appear or their Representative under the indenture or other
agreement (if any) pursuant to which Senior Indebtedness may have been issued,
as their respective interests may appear, for application to the payment of all
Obligations with respect to Senior Indebtedness remaining unpaid to the extent
necessary to pay such Obligations in full in accordance with their terms, after
giving effect to any concurrent payment or distribution to or for the holders of
Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform only such obligations on the part of the Trustee
as are specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Holders or the Company or any other Person money or assets to which
any holders of Senior Indebtedness shall be entitled by virtue of this Article
10, except if such payment is made as a result of the willful misconduct or
gross negligence of the Trustee.
Section 10.6. Notice by the Company.
The Company shall promptly notify the Trustee and the Paying
Agent of any facts known to the Company that would cause a payment of any
Obligations with respect to the Notes to violate this Article 10, but failure to
give such notice shall not affect the subordination of the Notes to the Senior
Indebtedness as provided in this Article.
Section 10.7. Subrogation.
After all Senior Indebtedness is irrevocably paid in full in
Cash or U.S. dollar-denominated Cash Equivalents reasonably satisfactory to the
holders thereof and until the Notes are paid in full, Holders shall be
subrogated (equally and ratably with all other Indebtedness pari passu with the
Notes) to the rights of holders of Senior Indebtedness to receive distributions
applicable to Senior Indebtedness to the extent that distributions otherwise
payable to the Holders have been applied to the payment of Senior Indebtedness.
A distribution made under this
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Article to holders of Senior Indebtedness that otherwise would have been made to
Holders is not, as between the Company and Holders, a payment by the Company on
the Notes.
Section 10.8. Relative Rights.
This Article defines the relative rights of Holders and
holders of Senior Indebtedness. Nothing in this Indenture shall:
(1) impair, as between the Company and Holders, the obligation
of the Company, which is absolute and unconditional, to pay principal
of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders and creditors of the
Company other than their rights in relation to holders of Senior
Indebtedness; or
(3) prevent the Trustee or any Holder from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Indebtedness to receive
distributions and payments otherwise payable to Holders.
If the Company fails because of this Article 10 to pay
principal of or interest on a Note on the due date, the failure is still a
Default or Event of Default.
Section 10.9. Subordination May Not Be Impaired by the Company.
No right of any holder of Senior Indebtedness to enforce the
subordination of the Indebtedness evidenced by the Notes shall be impaired by
any act or failure to act by the Company or any Holder or by the failure of the
Company or any Holder to comply with this Indenture.
Section 10.10. Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to
holders of Senior Indebtedness, the distribution may be made and the notice
given to their Representative.
Upon any payment or distribution of assets of the Company
referred to in this Article 10, the Trustee and the Holders shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee or
agent or other Person making any distribution to the Trustee or to the Holders
for the purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of Senior Indebtedness and other Indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 10.
Section 10.11. Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article 10 or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment or
distribution by the Trustee, and the Trustee and the
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Paying Agent may continue to make payments on the Notes, unless the Trustee
shall have received at its Corporate Trust Office at least five Business Days
prior to the date of such payment written notice of facts that would cause the
payment of any obligations with respect to the Notes to violate this Article.
Only the Company or a Representative may give the notice. Nothing in this
Article 10 shall impair the claims of, or payments to, the Trustee under or
pursuant to Section 7.7 hereof.
The Trustee shall be entitled to rely on the delivery to it of
a written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a Representative of such holder) to establish that such notice
has been given by a holder of Senior Indebtedness (or a Representative of any
such holder). In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of Senior Indebtedness to participate in any payment or distribution pursuant to
this Article 10, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article 10, and if such evidence is not furnished, the
Trustee may defer any payment which it may be required to make for the benefit
of such Person pursuant to the terms of this Indenture pending judicial
determination as to the rights of such Person to receive such payment.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were not Trustee.
Any Agent may do the same with like rights.
Section 10.12. Authorization to Effect Subordination.
Each Holder of a Note by the Holder's acceptance thereof
authorizes and directs the Trustee on the Holder's behalf to take such action as
may be necessary or appropriate to effectuate the subordination as provided in
this Article 10, and appoints the Trustee to act as the Holder's
attorney-in-fact for any and all such purposes.
ARTICLE 11
MISCELLANEOUS
Section 11.1. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA Section 318(c), such TIA-imposed duties
shall control.
Section 11.2. Notices.
Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others address:
72
If to the Company:
Cinemark USA, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Phone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attention: General Counsel
with a copy to:
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
0000 Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Phone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, P.C.
If to the Trustee:
U.S. Trust Company of Texas, N.A.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Phone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
With a copy to:
Xxxxxx and Xxxxx, L.L.P.
0000 Xxxxxxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxx 00000-0000
Phone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
The Company or the Trustee, by notice to the other, may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery, in each case to the address shown above.
Notwithstanding the foregoing, notices to the Trustee shall only be effective
upon actual receipt thereof by the Trustee at the Corporate Trust Office of the
Trustee.
73
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
Section 11.3. Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the Notes.
The Company, the Trustee, the Registrar and anyone else shall have the
protection of TIA Section 312(c).
Section 11.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 11.5 hereof) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 11.5 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 11.5. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314 (e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) the opinion of such Person, that he or she 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
satisfied; and
(c) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
74
Section 11.6. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
Section 11.7. No Personal Liability of Directors, Officers, Employees and
Others.
No past, present or future director, officer, employee, agent,
manager, incorporator, stockholder or other Affiliate of the Company, as such,
shall have any liability for any obligations of the Company under any of the
Notes, this indenture or for any claim based on, in respect of, or by reason of,
such obligations or their creation. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
Section 11.8. Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE AND THE NOTES.
Section 11.9. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or its Subsidiaries or of any
other Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
Section 11.10. Successors.
This Indenture shall inure to the benefit of and be binding
upon the parties hereto and each of their respective successors and assigns,
except that the Company may not assign this Indenture or its obligations
hereunder except as expressly permitted by Sections 5.1 and 5.2. Without
limiting the generality of the foregoing, this Indenture shall inure to the
benefit of all Holders from time to time. Except as set forth in Article 10,
nothing expressed or mentioned in this Indenture is intended or shall be
construed to give any Person, other than the parties hereto, their respective
successors and assigns, and the Holders, any legal or equitable right, remedy or
claim under or in respect of this Indenture or any provision herein contained.
Section 11.11. Severability.
In case any provision in this Indenture or in the Notes 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 11.12. 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.
75
Section 11.13. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of
the Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and shall
in no way modify or restrict any of the terms or provisions hereof.
Section 11.14. Counterparts.
This Indenture may be signed in counterparts and by the
different parties hereto in separate counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same instrument.
[Signatures on following page]
76
IN WITNESS WHEREOF, the parties hereto have executed this
Indenture this August 15, 1996.
CINEMARK USA, INC.
By: /s/ Xxxx Xxxxxxx
-----------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President
U.S. TRUST COMPANY OF TEXAS, N.A.,
as Trustee
By: /s/ Xxxx Xxxxxx
-----------------------------------
Name: Xxxx Xxxxxx
Title: Vice President
77
Exhibit A
(Face of Note)
Unless and until it is exchanged in whole or in part for Notes
in definitive form, this Note may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. Unless this certificate is presented by an authorized representative
of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) ("XXX"),
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 may be requested by an authorized representative of DTC (and any payment
is made to Cede & Co. or such other entity as may be 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.(1)
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD TO, OR FOR
THE ACCOUNT OR BENEFIT OF, ANY PERSON EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT) WHO IS AN INSTITUTION (AN "INSTITUTIONAL
ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL NOT PRIOR TO THE DATE WHICH IS
THREE YEARS AFTER THE LATER OF THE DATE OF ORIGINAL ISSUANCE OF THIS NOTE AND
THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER
OF THIS NOTE (THE "RESALE RESTRICTION TERMINATION DATE") RESELL, PLEDGE OR
OTHERWISE TRANSFER THIS NOTE, EXCEPT (A) TO THE ISSUER, (B) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER PURCHASING FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH THE RESALE PROVISIONS OF RULE 144A UNDER THE SECURITIES ACT, (C)
TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES
TO THE TRUSTEE A WRITTEN CERTIFICATION CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF
WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) PURSUANT TO THE RESALE
LIMITATIONS PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (E)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (F)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, (BASED UPON AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO
THE
--------
(1) This paragraph should be included only if the Note is issued in global form.
ISSUER IF THE ISSUER SO REQUESTS) SUBJECT IN EACH OF THE FOREGOING CASES TO ANY
REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY OF SUCH
ACCOUNT BE AT ALL TIMES WITHIN ITS CONTROL AND TO COMPLIANCE WITH APPLICABLE
STATE SECURITIES LAWS AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IF
THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER
MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY REQUIRE 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. THE FOREGOING RESTRICTIONS ON RESALE WILL
NOT APPLY SUBSEQUENT TO THE RESALE RESTRICTION TERMINATION DATE.(2)
--------
(2) This legend not required in the case of (1) a Note issued pursuant to
Section 2.6(g)(ii) of the Indenture or (2) a Series B Note issued pursuant to
Section 2.6(g)(iii) of the Indenture.
CINEMARK USA, INC.
9-5/8% Senior Notes due 2008 [Series A][, Series B]
$
----------
No. CUSIP #
----------
Cinemark USA, Inc., a Texas corporation (the "Company") promises to pay
to or registered assigns, the principal sum of $__________ Dollars on
August 1, 2008.
Interest Payment Dates: February 1 and August 1, commencing on February
1, 1997.
Record Dates: January 15 and July 15
Dated: , 1996
----------------------------
CINEMARK USA, INC.
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the Notes referred to in the
within-mentioned Indenture:
U.S. TRUST COMPANY OF TEXAS, N.A.
as Trustee
By:
-----------------------------------
Authorized Signatory
Dated:
--------------------------------
(Back of Note)
9-5/8% Senior Notes due 2008 [, Series A] [,Series B)
Capitalized terms used herein but not defined shall have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.
1. Interest. The Notes will be limited in aggregate principal amount to
$200 million and will mature on August 1, 2008. The Company promises to pay
interest on the principal amount of this Note from August 15, 1996 until
maturity. The Company will pay interest semi-annually on February 1 and August 1
of each year, commencing February 1, 1997, or if any such day is not a Business
Day, on the next succeeding Business Day (each an "Interest Payment Date").
Interest on the Notes will accrue at the rate of 9-5/8% per annum from the most
recent date to which interest has been paid or, if no interest has been paid,
from the Initial Issuance Date. The Company shall pay interest (including post-
petition interest in any proceeding under any Bankruptcy Law to the extent that
such interest is an allowed claim enforceable against the debtor under such
Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at the rate equal to 1% per annum in excess of the rate then in effect;
it shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months. Notwithstanding any other provision of the Indenture or
this Note: (i) accrued and unpaid interest on the Series A Notes being exchanged
in the Exchange offer shall be due and payable on the next Interest Payment Date
for the Series B Notes following the Exchange Offer, (ii) interest on the Series
B Notes to be issued in the Exchange Offer shall accrue from the date the
Exchange Offer is consummated and (iii) the Series B Notes shall have no
provisions for Liquidated Damages.
2. Method of Payment. The Company shall pay the principal of, and
premium and interest on, the Notes on the dates and in the manner provided
herein and in the Indenture. Principal of, and premium and interest on,
Definitive Notes will be payable, and Definitive Notes may be presented for
registration of transfer or exchange, at the office or agency of the Company
maintained for such purpose. Principal of, and premium and interest on, Global
Notes will be payable by the Company through the Trustee to the Depository in
immediately available funds. Holders of Definitive Notes will be entitled to
receive interest payments by wire transfer in immediately available funds if
appropriate wire transfer instructions have been received in writing by the
Trustee not less than 15 days prior to the applicable Interest Payment Date.
Such wire instructions, upon receipt by the Trustee, shall remain in effect
until revoked by such Holder. If wire instructions have not been received by the
Trustee with respect to any Holder of a Definitive Note, payment of interest may
be made by check in immediately available funds mailed to such Holder at the
address set forth upon the Register maintained by the Registrar.
3. Paying Agent and Registrar. Initially, U.S. Trust Company of Texas,
N.A., the Trustee under the Indenture, will act as Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such capacity,
except that none of the Company, its Subsidiaries or
their Affiliates shall act (i) as Paying Agent in connection with any
redemption, offer to purchase, discharge or defeasance, as otherwise specified
in the Indenture, and (ii) as Paying Agent or Registrar if a Default or Event of
Default has occurred and is continuing.
4. Indenture. The Company issued the Notes under an Indenture dated as
of August 15, 1996 (as such may be amended, supplemented or restated from time
to time, the "Indenture") between the Company and the Trustee. The terms of the
Notes include those stated in the Indenture and those made part of the Indenture
by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code
Sections 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are
referred to the Indenture and such Act for a statement of such terms. The Notes
are senior unsecured obligations of the Company limited to $200 million in
aggregate principal amount.
5. Optional Redemption.
The Notes will not be redeemable at the Company's option prior to
August 1, 2001, except as provided below. Thereafter, the Notes will be subject
to redemption at the option of the Company, in whole or in part, upon not less
than 30 nor more than 60 days' notice to the Holders, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest thereon to the applicable redemption date, if redeemed during
the twelve month period beginning on August 1 of the years indicated below:
YEAR PERCENTAGE
---- ----------
2001 104.813%
2002 102.406%
2003 and thereafter 100.000%
Notwithstanding the foregoing, on and prior to August 1, 1999, the
Company may redeem up to 35% of the aggregate principal amount of the Notes
originally outstanding at a redemption price of 110 of the principal amount
thereof, plus accrued and unpaid interest thereon to the redemption date, with
the net proceeds of one or more Equity Offerings of the Company or, if
applicable, a Parent, as described in Section 3.7 of the Indenture; provided
that at least 65% of the aggregate principal amount of the Notes originally
issued remains outstanding immediately after the occurrence of such redemption
(but such unredeemed Notes may be redeemed pursuant to the optional redemption
procedure described in the immediately preceding paragraph; and provided,
further, that such notice of redemption shall be given not later than 30 days,
and such redemption shall occur not later than 90 days, after the date of the
closing of any such Equity Offering. On and after the redemption date, interest
ceases to accrue on the Notes or portions thereof called for redemption.
6. Mandatory Redemption.
Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption payments with respect to the Notes.
7. Repurchase at Option of Holder.
(a) Upon a Change of Control, the Company shall be required to make an
offer to Holders to repurchase all or any part (equal to $1,000 or an integral
multiple thereof) of each Holder's Notes at a purchase price equal to 101& of
the aggregate principal amount thereof, plus accrued and unpaid interest thereon
to the date of purchase as provided in, and subject to the terms of, the
Indenture.
(b) If the Company or any Restricted Subsidiary consummates any Asset
Disposition, the Company may be required, subject to the terms and conditions of
the Indenture, to utilize a certain portion of the proceeds received from such
Asset Disposition to repurchase Notes at a purchase price equal to 1008 of the
principal amount thereof, plus accrued interest thereon to the date of purchase.
8. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, it need not
exchange or register the transfer of any Notes for a period of 15 days before a
selection of Notes to be redeemed or during the period between a record date and
the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
10. Unclaimed Money . If money for the payment of principal, premium or
interest remains unclaimed for one year, the Trustee and the Paying Agent will
pay the money back to the Company at its request. After that, all liability of
the Trustee and such Paying Agent with respect to such money shall cease.
11. Defeasance Prior to Redemption or Maturity. Subject to certain
conditions contained in the Indenture, the Company at any time may terminate
some or all of its obligations under the Notes and the Indenture if the Company
deposits with the Trustee money or U.S. Government Obligations sufficient to pay
the principal of, and premium and interest on, the Notes to redemption or
maturity, as the case may be.
12. Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the Notes then
outstanding, and any existing Default or Event or Default or compliance with any
provision of the Indenture or the Notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding Notes. Without
the consent of any Holder of a Note, the Indenture or the Notes may be amended
or supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes
in addition to or in place of certificated Notes, to provide for the assumption
of the Company's obligations to Holders of Notes in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA as then in effect.
13. Defaults and Remedies. Events of Default include: (i) default by
the Company in the payment of (A) the principal of (or premium, if any, on) any
Notes when the same becomes due and payable at maturity, by acceleration or
otherwise, (B) the redemption price on any redemption date, or (C) the Change of
Control Offer Price or the Net Proceeds Offer Price on the applicable Offer
Purchase Date relating to such Offer; (ii) default by the Company in the payment
of interest on any Note when the same becomes due and payable, which default
continues for a period of 30 calendar days; (iii) failure by the Company or any
Subsidiary of the Company to comply with any of its covenants or agreements in
the Notes or the Indenture (other than those referred to in clauses (i) and (ii)
above), which failure continues for 45 calendar days after receipt by the
Company of a Notice of Default specifying such Default; (iv) an event of default
on any other Indebtedness for borrowed money of the Company or any of its
Restricted Subsidiaries having an aggregate amount outstanding in excess of $5
million which default (A) is caused by a failure to pay when due (after giving
effect to any grace periods) any principal of, or premium, if any, or interest
on, such Indebtedness or (B) has caused the holders thereof to declare such
Indebtedness due and payable in advance of its scheduled maturity; (v) certain
events of bankruptcy or insolvency with respect to the Company or any
Significant Subsidiary of the Company; or (vi) the rendering of final
non-appealable judgments for the payment of money which in the aggregate exceed
$5 million (net of applicable insurance coverage which is acknowledged in
writing by the insurer) against the company or any Significant Subsidiary of the
Company by a court and which remain unstayed or undischarged for a period of 60
calendar days.
A Default under clause (iii) of the immediately preceding paragraph is
not an Event of Default until the Trustee notifies the Company, or the Holders
of at least 25% in principal amount of the Notes at the time outstanding notify
the Company and the Trustee, of the Default and the Company does not cure such
Default within 45 days after receipt of such notice. Notwithstanding the
foregoing, if an Event of Default specified in clause (iv) of the immediately
preceding paragraph occurs and is continuing, such Event of Default and all
consequences thereof (including, without limitation, any acceleration or
resulting payment default) shall be annulled and rescinded, automatically and
without any action by the Trustee or the holders of the Notes, if (i) the
Indebtedness that is the subject of such Event of Default has been repaid, or
(ii) the default relating to such Indebtedness is waived or cured (and if such
Indebtedness has-been accelerated, then the holders thereof have rescinded their
declaration of acceleration in respect of such Indebtedness). If any Event of
Default under clauses (i), (ii), (iii), (iv) or (vi) of the immediately
preceding paragraph occurs and is continuing, then the Holders of at least 25%
in aggregate principal amount of the then outstanding Notes by written notice to
the Company and the Trustee may declare the unpaid principal of, and any accrued
interest on, all the Notes to be due and payable immediately. If any Event of
Default with respect to the company specified in clause (v) of the immediately
preceding paragraph occurs, all outstanding principal and interest
on the Notes shall be immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder. The Holders of a majority in
aggregate principal amount of the Notes then outstanding, by written notice to
the Trustee and to the Company, may rescind an acceleration (except an
acceleration due to a default in payment of the principal of, or premium or
interest on, any of the Notes) if the rescission would not conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, premium or interest that have become due solely because of the
acceleration) have been cured or waived.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect any payment
due, or to enforce the performance of any provision, under the Notes or the
Indenture. The Trustee may refuse to enforce the Indenture or the Notes unless
it receives reasonable indemnity or security. Holders of Notes may not enforce
the Indenture or the Notes except as provided in the Indenture. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except under clauses (i) or (ii) above) if it determines that
withholding notice is in their interest.
14. Trustee's Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee, subject to the
provisions of TIA Section 310.
15. No Recourse Against Others. A director, officer, employee, agent,
manager, incorporator, stockholder or other Affiliate of the Company, as such,
shall not have any liability for any obligations of the Company under any of the
Notes or the Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
16. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
17. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
18. Additional Rights of Holders of Transfer Restricted Securities. In
addition to the rights provided to Holders under the Indenture, Holders of
Transfer Restricted Securities shall have all the rights set forth in the
Registration Rights Agreement.
19. 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 Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
20. Governing Law. THE INDENTURE AND THIS NOTE SHALL BE GOVERNED AND
CONSTRUED BY THE INTERNAL LAW OF THE STATE OF NEW YORK.
21. Successor Corporation. In the event a successor corporation assumes
all the obligations of the Company under the Notes and the Indenture, pursuant
to the terms thereof, the Company will be released from all such obligations.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Cinemark USA, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Phone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
Attention: General Counsel
Assignment Form
To assign this Note, fill in the form below and have your signature
guaranteed: (I) or (we) assign and transfer this Note to
-----------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________________________ to transfer this
Note on the books of the Company. The agent may substitute another to act for
him.
--------------------------------------------------------------------------------
Date: Your Name:
------------------------------ ----------------------------------------------------
(Print your name exactly as it appears on the face of this
Note)
Your Signature:
-----------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
-----------------------------------------
----------
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
Option of Holder to Elect Purchase
If you elect to have this Note purchased by the Company pursuant to
Section 4.10 or Section 4.14 of the Indenture, check the appropriate box below:
[ ] Section 4.10 [ ] Section 4.14
If you elect to have only part of this Note purchased by the Company
pursuant to Section 4.10 or Section 4.14 of the Indenture, state the amount (in
minimum denominations of $1000 or integral multiples thereof) you elect to have
purchased: $_____________
Date: Your Name:
------------------------------ -------------------------------------------
(Print your name exactly as it appears on the face
of this Note)
Your Signature:
--------------------------------------
(Sign exactly as your name appears on the Note)
Social Security or Tax Identification
No.:
-------------------------------------------------
Signature Guarantee*:
--------------------------------
----------
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
SCHEDULE OF EXCHANGES OF DEFINITIVE NOTE(3)
The following exchanges of a part of this Global Note for Definitive
Notes have been made:
Principal Amount of
this Global Note Signature of
Amount of decrease in Amount of increase in following such authorized officer
Principal Amount of Principal Amount of decrease (or of Trustee or Note
Date of Exchange this Global Note this Global Note increase) Custodian
---------------- --------------------- --------------------- ------------------- ------------------
--------
(3) This schedule should be included only if the Note is issued in global form.
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF NOTES
Re: 9-5/8% Senior Subordinated Notes due 2008 of Cinemark USA, Inc.
This Certificate relates to $______________ principal amount of Notes
held in * [ ] global or * [ ] definitive form by
__________________________________ (the "Transferor").
The Transferor*:
[ ] has requested the Trustee by written order to deliver, in
exchange for its beneficial interest in the Global Note held
by the Depositary, a Note or Notes in definitive, registered
form or a beneficial interest in the Series B Global Note
issued pursuant to the Exchange Offer, in both cases in the
authorized denominations in an aggregate principal amount
equal to its beneficial interest in such Global Note (or the
portion thereof indicated above); or
[ ] has requested the Trustee by written order to exchange or
register the transfer of a Note or Notes.
[ ] In connection with such request and in respect of each such
Note, the Transferor does hereby certify that it is familiar
with the Indenture relating to the above captioned Notes, and
the transfer of this Note does not require registration under
the Securities Act of 1933, as amended (the "Securities Act")
because such Note*:
[ ] is being acquired for the Transferor's own account, without
transfer; [ ] is being transferred pursuant to an effective
registration statement;
[ ] is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act), in reliance on
such Rule 144A;
[ ] is being transferred pursuant to an exemption from
registration in accordance with Rule 904 under the Securities
Act;**
[ ] is being transferred pursuant to Rule 144 under the Securities
Act; or
----------
* Check applicable box.
** If this box is checked, this certificate must be accompanied by an
opinion of counsel to the effect that such transfer is in compliance
with the Securities Act.
[ ] is being transferred pursuant to another exemption from the
registration requirements of the Securities Act (explain:
____________________________________________________________
_______________________________________________________ )***
Date: Your Name:
--------------------- -------------------------------------------
(Print your name exactly as it appears on the face
of this Note)
Your Signature:
--------------------------------------
(Sign exactly as your name appears on the Note)
Social Security or Tax Identification
No.:
-------------------------------------------------
Signature Guarantee*:
--------------------------------
----------
*** If this box is checked, this certificate must be accompanied by a
opinion of counsel to the effect that such transfer is in compliance
with the Securities Act.
**** Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
