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PACIFICA PAPERS INC.,
as Issuer,
----------------------------
THE GUARANTORS PARTY HERETO,
as Guarantors,
and
----------------------------
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, as Trustee
INDENTURE
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Dated as of March 12, 1999
US$200,000,000
10% Senior Notes due 2009
CROSS-REFERENCE TABLE
TIA INDENTURE
SECTION SECTION
------- -------
310 (a)(1)............................................................... 7.10
(a)(2)............................................................... 7.10
(a)(3)............................................................... N.A.
(a)(4)............................................................... N.A.
(a)(5)............................................................... N.A.
(b).................................................................. 7.08; 7.10; 11.02
(b)(1)............................................................... 7.10
(c).................................................................. N.A.
311 (a).................................................................. 7.11
(b).................................................................. 7.11
(c).................................................................. N.A.
312 (a).................................................................. 2.06
(b).................................................................. 11.03
(c).................................................................. 11.03
313 (a).................................................................. 7.06
(b)(1)............................................................... N.A.
(b)(2)............................................................... 7.06
(c).................................................................. 7.06; 11.02
(d).................................................................. 7.06
314 (a).................................................................. 4.02; 4.04; 11.02
(b).................................................................. N.A.
(c)(1)............................................................... 11.04
(c)(2)............................................................... 11.04
(c)(3)............................................................... N.A.
(d).................................................................. N.A.
(e).................................................................. 11.05
(f).................................................................. N.A.
315 (a).................................................................. 7.01(b)
(b).................................................................. 7.05; 11.02
(c).................................................................. 7.01(a)
(d).................................................................. 7.01(c)
(e).................................................................. 6.12
316 (a) (last sentence).................................................. 2.10
(a)(1)(A)............................................................ 6.05
(a)(1)(B)............................................................ 6.04
(a)(2)............................................................... N.A.
(b).................................................................. 6.08
(c).................................................................. 8.04
317 (a)(1)............................................................... 6.09
(a)(2)............................................................... 6.10
(b).................................................................. 2.05; 7.12
318 (a).................................................................. 11.01
_______________________
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions..............................................................................1
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.......................................26
SECTION 1.04. Rules of Construction...................................................................26
ARTICLE TWO
THE NOTES
SECTION 2.01. Amount of Notes.........................................................................27
SECTION 2.02. Form and Dating.........................................................................28
SECTION 2.03. Execution and Authentication............................................................28
SECTION 2.04. Registrar and Paying Agent..............................................................29
SECTION 2.05. Paying Agent To Hold Money in Trust.....................................................30
SECTION 2.06. Holder Lists............................................................................30
SECTION 2.07. Transfer and Exchange...................................................................30
SECTION 2.08. Replacement Notes.......................................................................31
SECTION 2.09. Outstanding Notes.......................................................................32
SECTION 2.10. Treasury Notes..........................................................................32
SECTION 2.11. Temporary Notes.........................................................................33
SECTION 2.12. Cancellation............................................................................33
SECTION 2.13. Defaulted Interest......................................................................33
SECTION 2.14. CUSIP Number............................................................................34
SECTION 2.15. Deposit of Moneys.......................................................................34
SECTION 2.16. Book-Entry Provisions for Global Notes..................................................34
SECTION 2.17. Special Transfer Provisions.............................................................37
SECTION 2.18. Computation of Interest.................................................................39
ARTICLE THREE
REDEMPTION
SECTION 3.01. Election To Redeem; Notices to Trustee..................................................39
SECTION 3.02. Selection by Trustee of Notes To Be Redeemed............................................40
SECTION 3.03. Notice of Redemption....................................................................40
SECTION 3.04. Effect of Notice of Redemption..........................................................41
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SECTION 3.05. Deposit of Redemption Price.............................................................41
SECTION 3.06. Notes Redeemed in Part..................................................................42
SECTION 3.07. Optional Redemption.....................................................................42
SECTION 3.08. Tax Redemption..........................................................................43
SECTION 3.09. Purchase of Notes.......................................................................43
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes........................................................................43
SECTION 4.02. Reports to Holders......................................................................44
SECTION 4.03. Waiver of Stay, Extension or Usury Laws.................................................44
SECTION 4.04. Compliance Certificate..................................................................44
SECTION 4.05. Taxes...................................................................................45
SECTION 4.06. Limitation on Additional Indebtedness...................................................45
SECTION 4.07. Limitation on Restricted Payments.......................................................46
SECTION 4.08. Limitation on Liens.....................................................................48
SECTION 4.09. Limitation on Transactions with Affiliates..............................................49
SECTION 4.10. Limitation on Asset Sales...............................................................50
SECTION 4.11. Limitation on Capital Stock of Restricted Subsidiaries..................................52
SECTION 4.12. Limitation on Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries..............................................................53
SECTION 4.13. Limitation on Subsidiaries..............................................................54
SECTION 4.14. Legal Existence.........................................................................54
SECTION 4.15. Change of Control Offer.................................................................54
SECTION 4.16. Payment of Additional Amounts...........................................................56
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Limitation on Consolidation, Amalgamation, Merger and Sale of Assets....................58
SECTION 5.02. Successor Person Substituted............................................................59
ARTICLE SIX
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default.......................................................................59
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SECTION 6.02. Acceleration............................................................................61
SECTION 6.03. Other Remedies..........................................................................62
SECTION 6.04. Waiver of Past Defaults and Events of Default...........................................62
SECTION 6.05. Control by Majority.....................................................................63
SECTION 6.06. Limitation on Suits.....................................................................63
SECTION 6.07. No Personal Liability of Directors, Officers, Employees and Stockholders................63
SECTION 6.08. Rights of Holders To Receive Payment....................................................64
SECTION 6.09. Collection Suit by Trustee..............................................................64
SECTION 6.10. Trustee May File Proofs of Claim........................................................64
SECTION 6.11. Priorities..............................................................................65
SECTION 6.12. Undertaking for Costs...................................................................65
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.......................................................................66
SECTION 7.02. Rights of Trustee.......................................................................67
SECTION 7.03. Individual Rights of Trustee............................................................69
SECTION 7.04. Trustee's Disclaimer....................................................................69
SECTION 7.05. Notice of Defaults......................................................................69
SECTION 7.06. Reports by Trustee to Holders...........................................................69
SECTION 7.07. Compensation and Indemnity..............................................................70
SECTION 7.08. Replacement of Trustee..................................................................71
SECTION 7.09. Successor Trustee by Consolidation, Merger, etc.........................................72
SECTION 7.10. Eligibility; Disqualification...........................................................72
SECTION 7.11. Preferential Collection of Claims Against Company.......................................72
SECTION 7.12. Paying Agents...........................................................................72
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. Without Consent of Holders..............................................................73
SECTION 8.02. With Consent of Holders.................................................................74
SECTION 8.03. Compliance with Trust Indenture Act.....................................................75
SECTION 8.04. Revocation and Effect of Consents.......................................................75
SECTION 8.05. Notation on or Exchange of Notes........................................................76
SECTION 8.06. Trustee To Sign Amendments, etc.........................................................76
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ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture..................................................................77
SECTION 9.02. Legal Defeasance........................................................................78
SECTION 9.03. Covenant Defeasance.....................................................................78
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance...................................79
SECTION 9.05. Deposited Money and U.S. Government Obligations To Be Held in Trust; Other
Miscellaneous Provisions..................................................81
SECTION 9.06. Reinstatement...........................................................................81
SECTION 9.07. Moneys Held by Paying Agent.............................................................82
SECTION 9.08. Moneys Held by Trustee..................................................................82
ARTICLE TEN
GUARANTEE OF NOTES
SECTION 10.01. Guarantee..............................................................................83
SECTION 10.02. Execution and Delivery of Guarantee....................................................84
SECTION 10.03. Limitation of Guarantee................................................................85
SECTION 10.04. Additional Guarantors..................................................................85
SECTION 10.05. Release of Guarantor...................................................................85
SECTION 10.06. Waiver of Subrogation..................................................................86
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls...........................................................87
SECTION 11.02. Notices................................................................................87
SECTION 11.03. Communications by Holders with Other Holders...........................................89
SECTION 11.04. Certificate and Opinion as to Conditions Precedent.....................................89
SECTION 11.05. Statements Required in Certificate and Opinion.........................................89
SECTION 11.06. Rules by Trustee and Agents............................................................90
SECTION 11.07. Business Days; Legal Holidays..........................................................90
SECTION 11.08. Governing Law..........................................................................90
SECTION 11.09. Agent for Service; Submission to Jurisdiction; Waiver of Immunities....................90
SECTION 11.10. No Adverse Interpretation of Other Agreements..........................................91
SECTION 11.11. No Recourse Against Others.............................................................91
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SECTION 11.12. Successors.............................................................................92
SECTION 11.13. Multiple Counterparts..................................................................92
SECTION 11.14. Table of Contents, Headings, etc.......................................................92
SECTION 11.15. Separability...........................................................................92
SECTION 11.16. Judgment Currency......................................................................92
EXHIBITS
Exhibit A. Form of Note..........................................................................A-1
Exhibit B. Form of Private Placement Legend......................................................B-1
Exhibit C. Form of Legend for Global Note........................................................C-1
Exhibit D. Form of Certificate to Be Delivered in Connection with Transfers to
Non-QIB Institutional Accredited Investors.........................................D-1
Exhibit E. Form of Certificate to Be Delivered in Connection with Transfers
Pursuant to Regulation S...........................................................E-1
Exhibit F. Form of Guarantee.....................................................................F-1
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INDENTURE, dated as of March 12, 1999, between PACIFICA PAPERS INC., a
corporation amalgamated under the laws of Canada, as issuer (the "Company"), the
Guarantors (as defined herein) and Norwest Bank Minnesota, National Association,
as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Notes.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"ACQUIRED INDEBTEDNESS" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary or
is merged into or consolidated with the Company or a Restricted Subsidiary or
which is assumed in connection with the acquisition of assets from such Person
and, in each case, not incurred by such Person in connection with, or in
anticipation or contemplation of, such Person becoming a Restricted Subsidiary
or such merger, consolidation or acquisition.
"ADDITIONAL INTEREST" means additional interest on the Notes which the
Company and any Guarantors, jointly and severally, agree to pay to the Holders
pursuant to Section 4 of the Registration Rights Agreement.
"AFFILIATE" means, with respect to any specific Person, any other Person
(including, without limitation, such Person's issue, siblings and spouse)
that directly or indirectly through one or more intermediaries controls, or
is controlled by, or is under common control with, such specified Person;
PROVIDED that for purposes of this Indenture, the term "Affiliate" shall not
include CIBC Xxxxxxxxxxx Corp. or Xxxxxx XxXxxxxx Inc. or any of their
Affiliates. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "CONTROLLING," "CONTROLLED BY," and "UNDER
COMMON CONTROL WITH"), as used with respect to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; PROVIDED that, for
purposes of Section 4.09 hereof, beneficial ownership of at least 10% of the
voting securities of a Person, either directly or indirectly, shall be deemed
to be control.
"AGENT" means any Registrar, Paying Agent, or agent for service or notices
and demands.
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"ASSET ACQUISITION" means (a) an Investment by the Company or any
Restricted Subsidiary of the Company in any other Person pursuant to which such
Person becomes a Restricted Subsidiary of the Company, or shall be merged with
or into the Company or any Restricted Subsidiary of the Company or (b) the
acquisition by the Company or any Restricted Subsidiary of the Company of the
assets of any Person (other than a Restricted Subsidiary of the Company) which
constitute all or substantially all of the assets of such Person or comprise any
division or line of business of such Person or any other properties or assets of
such Person other than in the ordinary course of business.
"ASSET SALE" means any direct or indirect sale, issuance, conveyance,
assignment, transfer, lease (other than operating leases entered into in the
ordinary course of business) or other disposition (including pursuant to any
Sale and Lease-Back Transaction), other than to the Company or any of its
Restricted Subsidiaries, in any single transaction or series of related
transactions of (a) any Capital Stock of any Restricted Subsidiary of the
Company or (b) any other property or assets (including any interest therein) of
the Company or of any Restricted Subsidiary thereof outside of the ordinary
course of business; PROVIDED that Asset Sales shall not include (i) a
transaction or series of related transactions for which the Company or its
Restricted Subsidiaries receive aggregate consideration of less than $5,000,000
(provided that the Company or such Restricted Subsidiary received consideration
equal to the Fair Market Value of any such property or assets so sold, conveyed,
assigned, transferred, leased or otherwise disposed of), (ii) the sale, lease,
conveyance, disposition or other transfer of all or substantially all of the
assets of the Company as permitted under Section 5.01 hereof, (iii) sales of
property or equipment that has become worn out, obsolete or damaged or otherwise
unsuitable for use in connection with the business of the Company or any
Restricted Subsidiary, as the case may be, (iv) the sale of inventory in the
ordinary course of business, (v) any Restricted Payment made in compliance with
Section 4.07 hereof, (vi) the surrender or waiver of contract rights or the
settlement, release or surrender of contract, tort or other claims of any kind,
(vii) the granting of Liens not prohibited by this Indenture, and (viii) the
liquidation of Cash Equivalents in the ordinary course of business.
"ASSET SALE PROCEEDS" means, with respect to any Asset Sale, (i) cash or
Cash Equivalents received by the Company or any Restricted Subsidiary of the
Company from such Asset Sale, after (a) provision for all income or other taxes
measured by or resulting from such Asset Sale, (b) payment of all brokerage
commissions, underwriting and other fees and expenses, including, without
limitation, legal, accounting and appraisal fees, related to such Asset Sale,
(c) provision for minority interest holders in any Restricted Subsidiary of the
Company as a result of such Asset Sale and (d) deduction of appropriate amounts
to be provided by the Company or a Restricted Subsidiary of the Company as a
reserve, in accordance with GAAP, against any liabilities associated with the
assets sold or disposed of in such Asset Sale and retained by the Company or a
Restricted Subsidiary after such Asset Sale, including, without limitation,
pension and other post-employment benefit liabilities and
-3-
liabilities related to environmental matters or against any indemnification
obligations associated with the assets sold or disposed of in such Asset Sale
and (ii) promissory notes and other non-cash consideration received by the
Company or any Restricted Subsidiary from such Asset Sale or other disposition
upon the liquidation or conversion of such notes or non-cash consideration into
cash.
"ATTRIBUTABLE INDEBTEDNESS" in respect of a Sale and Lease-Back Transaction
means, as at the time of determination, present value (discounted according to
GAAP at the cost of indebtedness implied in the Sale and Lease-Back Transaction)
of the total obligations of the lessee for minimum rental payments during the
remaining term of the lease included in such Sale and Lease-Back Transaction
(including any period for which such lease has been extended).
"AVAILABLE ASSET SALE PROCEEDS" means, with respect to any Asset Sale, the
aggregate Asset Sale Proceeds from such Asset Sale that have not been applied in
accordance with clauses (iii)(a) or (iii)(b), and which have not yet been the
basis for an Excess Proceeds Offer in accordance with clause (iii)(c), in each
case, of the first paragraph of Section 4.10 hereof.
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar Federal or state
law for the relief of debtors.
"BOARD OF DIRECTORS" means, as to any Person, the board of directors of
such Person and any duly authorized committee thereof.
"BOARD RESOLUTION" means a copy of a resolution certified pursuant to an
Officers' Certificate to have been duly adopted by the Board of Directors of the
Company or a Guarantor, as appropriate, and to be in full force and effect, and,
as so certified, delivered to the Trustee.
"CAPITAL CONTRIBUTION" means any cash contribution to the equity of the
Company from a direct or indirect parent of the Company or from another
shareholder for which no consideration other than the issuance of Capital Stock
(other than Disqualified Capital Stock) is given.
"CAPITAL STOCK" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated and whether
or not voting) of corporate stock, shares, partnership interests or any other
participation, right or other interest in the nature of an equity interest in
such Person including, without limitation, Common Stock and Preferred Stock of
such Person, or any option, warrant or other security convertible into any of
the foregoing.
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"CAPITALIZED LEASE OBLIGATIONS" means, with respect to any Person,
Indebtedness represented by obligations under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP, and the
amount of such Indebtedness shall be the capitalized amount of such obligations
determined in accordance with GAAP.
"CASH EQUIVALENTS" means (i) Canadian or U.S. dollars, (ii) marketable
direct obligations issued by, or unconditionally guaranteed by, the United
States or Canadian Government or issued by any agency thereof and backed by the
full faith and credit of the United States or Canada, in each case maturing
within one year from the date of acquisition thereof; (iii) marketable direct
obligations issued by any state of the United States of America or any province
of Canada or any political subdivision of any such state or province, as the
case may be, or any public instrumentality thereof maturing within one year from
the date of acquisition thereof and, at the time of acquisition, having one of
the two highest ratings obtainable from either Standard & Poor's Ratings Group
("S&P") or Xxxxx'x Investors Service, Inc. ("MOODY'S"); PROVIDED that, in the
event that any such obligation is not rated by S&P or Moody's, such obligation
shall have the highest rating from Dominion Bond Rating Service Limited
("DBRS"); (iv) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at least
R-1 (low) from DBRS or A-2 from S&P or at least P-2 from Moody's; (v) overnight
deposits, certificates of deposit or bankers' acceptances maturing within one
year from the date of acquisition thereof issued by any bank organized under the
laws of the United States of America or Canada or any state or province, as the
case may be, thereof or the District of Columbia or any U.S. or Canadian branch
of a foreign bank having at the date of acquisition thereof combined capital and
surplus of not less than US$200,000,000; (vi) repurchase obligations with a term
of not more than seven days for underlying securities of the types described in
clause (ii) above entered into with any bank meeting the qualifications
specified in clause (v) above; and (vii) investments in money market funds which
invest substantially all their assets in securities of the types described in
clauses (i) through (iv) above.
A "CHANGE OF CONTROL" of the Company will be deemed to have occurred at
such time as (i) any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act ("GROUP"), other than Pacifica Paper Limited
Partnership or Pacifica Paper Services Ltd. prior to the Reorganization, becomes
the beneficial owner (as defined under Rule 13d-3 or any successor rule or
regulation promulgated under the Exchange Act), directly or indirectly, of 50%
or more of the total voting power of the Common Stock of the Company, (ii) there
shall be consummated any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant to which the
Common Stock of the Company would be converted into cash, securities or other
property, other than a merger or consolidation of the Company in which the
holders of the Common Stock of the Company outstanding immediately prior to the
consolidation or merger hold, directly or indirectly, at least a majority of the
Common Stock of the surviving corporation immediately
-5-
after such consolidation or merger, (iii) (A) prior to the Reorganization, the
first day on which a majority of the members of the Board of Directors of
Pacifica Paper Services Ltd. are not Continuing Directors or (B) after the
Reorganization, the first day on which a majority of the members of the Board of
Directors of the Company are not Continuing Directors or (iv) prior to the
Reorganization, Pacifica Paper Services Ltd., as general partner of Pacifica
Paper Limited Partnership, ceases to own, directly or indirectly, 100% of the
outstanding Capital Stock of the Company.
"CHANGE OF CONTROL TRIGGERING EVENT" means the occurrence of both a Change
of Control and a Rating Decline.
"COMMISSION" means the U.S. Securities and Exchange Commission.
"COMMON STOCK" of any Person means all Capital Stock of such Person that is
generally entitled to (i) vote in the election of directors of such Person or
(ii) if such Person is not a corporation, vote or otherwise participate in the
selection of the governing body, partners, managers or others that will control
the management and policies of such Person.
"COMPANY" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party pursuant to Article Five of this
Indenture and thereafter means the successor.
"COMPANY REQUEST" means any written request signed in the name of the
Company by any one of the Chairman of the Board of Directors, the Chief
Executive Officer, the President, any Vice President, the Chief Financial
Officer, the Controller or the Treasurer of the Company and attested to by the
Secretary or any Assistant Secretary of the Company.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" means, at any time, with
respect to any Person, the ratio of EBITDA of such Person for (x) the four
most recent consecutive fiscal quarters for which consolidated financial
statements are available, if the Company shall be in compliance with its
obligations set forth under Section 4.02 or (y) the four most recent fiscal
quarters, if the Company shall not be in compliance with its obligations set
forth under Section 4.02 (the "FOUR-QUARTER PERIOD") in either case ending on
or prior to the date of determination of Consolidated Fixed Charges of such
Person for such Four-Quarter Period. In addition to and without limitation of
the foregoing, for purposes of this definition, "EBITDA" and "Consolidated
Fixed Charges" shall be calculated after giving effect on a PRO FORMA basis
to (i) the incurrence or repayment of any Indebtedness of such Person or any
of its Restricted Subsidiaries (and the application of the proceeds thereof)
giving rise to the need to make such calculation, (ii) any incurrence or
repayment of other Indebtedness (and the application of the proceeds
thereof), in each case set forth in clauses (i) and (ii), occurring on or
after the first day of the Four-Quarter Period and on or prior to the date of
determination, as if such incurrence or repayment, as the case may be (and
the application of the proceeds thereof),
-6-
occurred on the first day of such Four-Quarter Period and (iii) any Asset
Sales or Asset Acquisitions (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation as a result of
the Company or one of its Restricted Subsidiaries (including any Person who
becomes a Restricted Subsidiary as a result of the Asset Acquisition)
incurring, assuming or otherwise being liable for Acquired Indebtedness and
also including any increase or decrease, as the case may be, in EBITDA
directly attributable to the assets which are the subject of the Asset Sale
or Asset Acquisition during the Four-Quarter Period) occurring on or after
the first day of the Four-Quarter Period and on or prior to the date of
determination, as if such Asset Sale or Asset Acquisition (including the
incurrence, assumption or liability for any such Acquired Indebtedness)
occurred on the first day of such Four-Quarter Period.
"CONSOLIDATED FIXED CHARGES" means, with respect to any Person, for any
period, the sum, without duplication, of (i) Consolidated Interest Expense, plus
(ii) the amount of all dividend payments (to any Person other than the Company
or a Restricted Subsidiary) on any series of Disqualified Capital Stock of such
Person (other than dividends paid in Capital Stock (other than Disqualified
Capital Stock)) paid, accrued or scheduled to be paid or accrued during such
period, plus (iii) the amount of all cash dividend payments (to any Person other
than the Company or a Restricted Subsidiary) on any Series of Preferred Stock
(other than Disqualified Capital Stock) of such Person paid during such period,
in each case, on a consolidated basis in accordance with GAAP.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person, for any
period, the sum, without duplication, of (i) the aggregate amount of interest
charges (excluding (a) fees and expenses incurred in connection with the
Offering, (b) the amortization of any deferred gains or losses in respect of
Indebtedness denominated in foreign currency as a result of fluctuations in
exchange rates and (c) any premium paid in connection with the redemption or
retirement of any Indebtedness of such Person or its Restricted Subsidiaries
prior to the stated maturity thereof), whether expensed or capitalized, incurred
or accrued by such Person and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP for such period (including non-cash
interest payments), plus (ii) to the extent not included in clause (i) above, an
amount equal to the sum of: (A) imputed interest included in Capitalized Lease
Obligations, (B) all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing, (C) the net
costs associated with Interest Rate Agreements, Currency Agreements and other
hedging obligations, (D) amortization of deferred financing costs and expenses,
(E) the interest portion of any deferred payment obligations, (F) amortization
of discount or premium on Indebtedness, if any, (G) all capitalized interest and
all accrued interest, (H) all other non-cash interest expense, (I) all interest
incurred or paid under any guarantee of Indebtedness (including a guarantee of
principal, interest or any combination thereof) of any Person and (J) the amount
of all payments charged to shareholder's equity on any "compound financial
-7-
instrument" (as described under GAAP) paid, accrued or scheduled to be paid or
accrued during such period. For purposes of calculating Consolidated Interest
Expense on a pro forma basis, (1) interest on Indebtedness bearing a floating
rate of interest shall be calculated using the interest rate in effect at the
time of determination, taking into account on a pro forma basis any Interest
Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement
has a remaining term at the date of determination of at least 12 months and (2)
if Indebtedness was incurred under a revolving credit facility, the interest
expense on such Indebtedness shall be calculated based upon the average daily
balance of such Indebtedness during the applicable period.
"CONSOLIDATED NET INCOME" means, with respect to any Person, 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; PROVIDED that, to the extent included in calculating Net Income of
the referent Person, (a) the Net Income of any Person, other than the referent
Person or a Restricted Subsidiary of the referent Person, shall be excluded,
except to the extent of the amount of cash dividends or distributions actually
received by the referent Person or a Restricted Subsidiary of the referent
Person, (b) the Net Income (but not loss) of any Restricted Subsidiary of the
Person in question that is subject to any restriction or limitation on the
payment of dividends or the making of other distributions (other than pursuant
to the Notes or this Indenture or pursuant to a restriction or limitation of the
type described in clause (ii) of Section 4.12) shall be excluded to the extent
of such restriction or limitation, (c)(i) the Net Income of any Person acquired
in a "pooling of interests" transaction for any period prior to the date of such
acquisition shall be excluded and (ii) any net after-tax gain (but not loss)
resulting from an Asset Sale by the Person in question or any of its Restricted
Subsidiaries other than in the ordinary course of business shall be excluded,
(d) after-tax items classified as extraordinary or unusual gains or losses and
any foreign exchange gains and losses shall be excluded, (e) the cumulative
effect of a change in accounting principles after the Issue Date shall be
excluded, (f) any restoration to income or any contingency reserve of an
extraordinary, non-recurring or unusual nature shall be excluded, except to the
extent that provision for such reserve was made out of Consolidated Net Income
accrued at any time subsequent to the Issue Date and (g) in the case of a
successor to the referent Person by consolidation or merger or as a transferee
of the referent Person's assets, any earnings of the successor corporation prior
to such consolidation, merger or transfer of assets shall be excluded.
"CONSOLIDATED NET WORTH" of any Person means, as of any date, the
consolidated shareholders' equity of such Person as determined in accordance
with GAAP, less (to the extent included) amounts attributable to Disqualified
Capital Stock of such Person.
"CONTINUING DIRECTOR" means, (a) with respect to Pacifica Paper Services
Ltd., as of any date of determination, any member of the Board of Directors of
Pacifica Paper
-8-
Services Ltd. who (i) was a member of such Board of Directors on the Issue Date
or (ii) was approved by the affirmative vote of a majority of the Continuing
Directors who were members of such Board of Directors at the time of such
director's nomination or election and (b) with respect to the Company, as of any
date of determination, any member of the Board of Directors of the Company who
(i) was a member of the Board of Directors of the Company on the Issue Date or
(ii) was approved by the affirmative vote of a majority of the Continuing
Directors who were members of the Board of Directors of Pacifica Paper Services
Ltd. or the Board of Directors of the Company at the time of such director's
nomination or election.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is
located at c/o Norwest Bank Minnesota, National Association, Norwest Center,
Sixth and Marquette Xxxxxxxxxxx, XX 00000, Attention: Corporate Trust
Services.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"DEFAULT" means any event that is, or with the passing of time or giving of
notice or both would be, an Event of Default.
"DESIGNATION" shall have the meaning set forth in the definition of
"Restricted Payment."
"DESIGNATION AMOUNT" shall have the meaning set forth in the definition of
"Restricted Payment."
"DISQUALIFIED CAPITAL STOCK" means any Capital Stock of a Person or a
Restricted Subsidiary thereof which, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable at the
option of the holder), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof (except, in each case, in
accordance with a change of control provision, which provision has substantially
the same effect as Section 4.15 hereof), in whole or in part, or is exchangeable
into Indebtedness on or prior to the final maturity date of the Notes.
"DTC" means The Depositary Trust Company, its nominee or successor.
-9-
"EBITDA" means, with respect to any Person and its Restricted Subsidiaries,
for any period, an amount equal to (a) the sum, without duplication, of (i)
Consolidated Net Income for such period, MINUS any net income (or PLUS any net
loss) attributable to discontinued operations (including, without limitation,
operations disposed of during such period whether or not such operations were
classified as discontinued), PLUS (ii) the provision for taxes for such period
based on income or profits to the extent such income or profits were included in
computing Consolidated Net Income (MINUS any provision for taxes utilized in
computing net loss under clause (i) hereof to the extent such provision reduced
net loss), PLUS (iii) Consolidated Interest Expense for such period, PLUS (iv)
depreciation for such period on a consolidated basis, to the extent reducing
Consolidated Net Income, PLUS (v) amortization of goodwill, deferred charges and
other intangibles for such period on a consolidated basis, to the extent
reducing Consolidated Net Income, PLUS (vi) any other non-cash items reducing
Consolidated Net Income for such period, MINUS (b) all non-cash items increasing
Consolidated Net Income for such period, determined on a consolidated basis in
accordance with GAAP.
"EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"EXCHANGE NOTES" has the meaning provided in the Registration Rights
Agreement.
"FAIR MARKET VALUE" means, with respect to any asset or property, the price
which could be negotiated in an arm's-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction. Fair Market Value
shall be determined by the Board of Directors of the Company acting reasonably
and in good faith and, in the case of determination involving assets or property
in excess of $3,000,000 shall be evidenced by a resolution of the Board of
Directors of the Company delivered to the Trustee.
"GAAP" means generally accepted accounting principles in Canada as in
effect on the Issue Date.
"GUARANTEE" means a guarantee of the Notes by a Guarantor issued pursuant
to the terms of this Indenture.
"GUARANTORS" means each Restricted Subsidiary of the Company that hereafter
becomes a Guarantor pursuant to this Indenture.
"HOLDER," "HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is
registered on the Registrar's books.
-10-
"HOLDINGS LOAN DISTRIBUTION" means a distribution (whether in the form of a
repayment of intercompany loans or advances, a dividend or intercompany loan)
from the Company to Pacifica Holdings Ltd. and from Pacifica Holdings Ltd. to
560081 B.C. Ltd. made on the Issue Date in an amount not to exceed the principal
amount of the Holdings Loan plus accrued interest thereon through and including
the Issue Date; provided that the proceeds of such distribution are immediately
applied to the repayment in full of the Holdings Loan, including all accrued
interest thereon.
"HOLDINGS LOAN" means the loan in the principal amount of $234,900,000 made
pursuant to a loan agreement, dated as of June 8, 1998, made among 560081 B.C.
Ltd., as borrower, CIBC Capital Partners, as agent, and CIBC Capital Partners,
Trilon Securities Corp. and Xxxxxxxxx Corp., as lenders.
"INCUR" means, with respect to any Indebtedness or other obligation of
any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become liable in respect of such Indebtedness
or other obligation or the recording, as required pursuant to GAAP or
otherwise, of any such Indebtedness or other obligation on the balance sheet
of such Person (and "INCURRENCE," "INCURRED," "INCURRABLE," and "INCURRING"
shall have meanings correlative to the foregoing); PROVIDED that a change in
GAAP that results in an obligation of such Person that exists at such time
becoming Indebtedness shall not be deemed an incurrence of such Indebtedness.
"INDEBTEDNESS" means (without duplication, including, without limitation,
duplication arising or existing because a Person and one or more of its
subsidiaries are or shall become either directly or indirectly liable for the
same Indebtedness whether by virtue of guarantees, or joint, or joint and
several liability in respect of such Indebtedness or otherwise) with respect to
any Person, any indebtedness at any time outstanding, secured or unsecured,
contingent or otherwise, which is for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), or evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any property (excluding, without limitation, any balances that
constitute accounts payable or trade payables, and other accrued liabilities
arising in the ordinary course of business) if and to the extent any of the
foregoing indebtedness would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, and shall also include, to the extent
not otherwise included (i) any Capitalized Lease Obligations of such Person,
(ii) obligations secured by a Lien to which any property or assets owned or held
by such Person are subject, whether or not the obligation or obligations secured
thereby shall have been assumed by a third party, PROVIDED that, for the
purposes of determining the amount of Indebtedness described in this clause, if
recourse with respect to such Indebtedness is limited to such property or
assets, the amount of such Indebtedness shall be deemed to be the Fair Market
Value of such property or assets, (iii) guarantees of items of
-11-
other Persons which would be included within this definition for such other
Persons (whether or not such items would appear upon the balance sheet of the
guarantor), (iv) all obligations for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction, (v) all
Disqualified Capital Stock issued by such Person with the amount of Indebtedness
represented by such Disqualified Capital Stock being equal to the greater of its
voluntary or involuntary liquidation preference and its maximum fixed repurchase
price (for the purposes hereof, "MAXIMUM FIXED REPURCHASE PRICE" of any
Disqualified Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Disqualified Capital Stock as if
such Disqualified Capital Stock were repurchased on any date on which
Indebtedness shall be required to be determined pursuant to this Indenture and
if such price is based upon, or measured by, the fair market value of such
Disqualified Capital Stock, such price shall be the Fair Market Value of such
Disqualified Capital Stock), (vi) obligations of any such Person under any
Currency Agreement or any Interest Rate Agreement applicable to any of the
foregoing (if and to the extent such Currency Agreement or Interest Rate
Agreement obligations would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP) and (vii) Attributable Indebtedness.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and,
with respect to contingent obligations, the maximum liability upon the
occurrence of the contingency giving rise to the obligation; PROVIDED that (i)
the amount outstanding at any time of any Indebtedness issued with original
issue discount is the accreted value of such Indebtedness at such time as
determined in conformity with GAAP and (ii) Indebtedness shall not include any
liability for federal, provincial, state, local or other taxes. Notwithstanding
any other provision of the foregoing definition, any trade payable arising from
the purchase of goods or materials or for services obtained in the ordinary
course of business shall not be deemed to be Indebtedness of the Company or any
of its Restricted Subsidiaries for purposes of this definition. Furthermore,
guarantees of (or obligations with respect to letters of credit supporting)
Indebtedness otherwise included in the determination of such amount shall not
also be included.
"INDENTURE" means this Indenture as amended, restated or supplemented from
time to time.
"INDEPENDENT FINANCIAL ADVISOR" means an investment banking firm or
accounting firm of national reputation in the United States or Canada (i) which
does not, and whose directors, officers and employees or Affiliates do not, have
a direct or indirect financial interest in the Company or any of its Affiliates;
PROVIDED that, notwithstanding the foregoing, each of CIBC Xxxxxxxxxxx Corp.,
Xxxxxx XxXxxxxx Inc., and their Affiliates shall be deemed to meet the criteria
set forth in clause (i) with respect to its qualification as an Independent
Financial Advisor and (ii) which, in the judgment of the Board of Directors of
the Company, is otherwise independent and qualified to perform the task for
which it is to be engaged.
-12-
"INITIAL PURCHASERS" means CIBC Xxxxxxxxxxx Corp. and Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as that term is defined in Rule 501 (a)(1), (2), (3) or
(7) promulgated under the Securities Act.
"INTEREST PAYMENT DATE" means the stated maturity of an installment of
interest on the Notes.
"INTEREST RATE AGREEMENT" means, with respect to any Person, any interest
rate swap agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement designed to protect the party indicated therein
against fluctuations in interest rates.
"INVESTMENTS" means (without duplication), with respect to any Person,
directly or indirectly, any advance (or other extension of credit), account
receivable (other than an account receivable arising in the ordinary course of
business of such Person), loan or capital contribution to (by means of transfers
of cash or other Property to others, payments for Property or services for the
account or use of others or otherwise), any guarantee of any obligations or
Indebtedness of any other Person, the purchase of any Capital Stock, bonds,
notes, debentures, partnership or joint venture interests or other securities
of, the acquisition, by purchase or otherwise, of all or substantially all of
the business or assets or stock or other evidence of beneficial ownership of, or
interest in any Person or the making of any investment in any Person.
Investments shall exclude (i) extensions of trade credit to customers and
advances in respect of commissions and travel and similar expenses to officers
and employees, in each case made in the ordinary course of business and (ii) the
repurchase of securities of any Person by such Person. For the purposes of
Section 4.07 hereof, the amount of any Investment shall be the original cost of
such Investment plus the cost of all additional Investments by the Company or
any of its Restricted Subsidiaries, without any adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect to such
Investment, reduced by the payment of dividends or distributions in connection
with such Investment or any other amounts received in respect of such
Investment; PROVIDED that no such payment of dividends or distributions or
receipt of any such other amounts shall reduce the amount of any Investment if
such payment of dividends or distributions or receipt of any such amounts would
be included in Consolidated Net Income. In determining the amount of any
Investment involving the transfer of any property or assets other than cash,
such property or assets shall be valued at its or their Fair Market Value at the
time of such transfer, as determined in good faith by the Board of Directors of
the Person making such transfer.
"ISSUE DATE" means the date the Notes are first issued by the Company and
authenticated by the Trustee under this Indenture.
-13-
"LIEN" means, with respect to any property or assets of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, priority,
or other security agreement of any kind or nature whatsoever on or with respect
to such property or assets (including without limitation, any Capitalized Lease
Obligation, conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"MATERIAL SUBSIDIARY" means, at any date of determination, (a) any
Restricted Subsidiary that, together with its Subsidiaries that constitute
Restricted Subsidiaries (i) for the most recent fiscal year of the Company
accounted for more than 5.0% of the consolidated revenues of the Company and the
Restricted Subsidiaries or (ii) as of the end of such fiscal year, owned more
than 5.0% of the consolidated assets of the Company and the Restricted
Subsidiaries, all as set forth on the consolidated financial statements of the
Company and the Restricted Subsidiaries for such year prepared in conformity
with GAAP, and (b) any Restricted Subsidiary which, when aggregated with all
other Restricted Subsidiaries that are not otherwise Material Subsidiaries and
as to which any event described in clause (8) of Section 6.01 hereof has
occurred, would constitute a Material Subsidiary under clause (a) of this
definition.
"MATURITY DATE" means March 15, 2009.
"MOODY'S" means Xxxxx'x Investors Service, Inc. and its successors.
"NET INCOME" means, with respect to any Person, for any period, the net
income (loss) of such Person determined in accordance with GAAP.
"NEW CREDIT FACILITIES" means, collectively, any credit facilities, of the
Company and/or the Guarantors, together with the related documents thereto
(including, without limitation, any loan agreements, notes, guarantee
agreements, collateral documents, mortgages, instruments and security documents
executed in connection therewith), in each case as such agreements may be
amended (including any amendment and restatement thereof), supplemented or
otherwise modified from time to time, including without limitation any agreement
extending the maturity of, refinancing, replacing or otherwise restructuring
(including adding Subsidiaries of the Company as additional borrowers or
guarantors thereunder) all or any portion of the Indebtedness under such
agreements, together with any successor or replacement agreements and whether by
or with the same or any other agent, lender or group of lenders.
"NON-U.S. PERSON" means a Person who is not a U.S. person, as defined in
Regulation S.
-14-
"NOTES" means the 10% Senior Notes due 2009 issued by the Company,
including, without limitation, the Private Exchange Notes, if any, and the
Exchange Notes, treated as a single class of securities, as amended or
supplemented from time to time in accordance with the terms hereof, that are
issued pursuant to this Indenture.
"OFFERING" means the offering pursuant to the Offering Memorandum of the
Notes to be issued on the Issue Date.
"OFFERING MEMORANDUM" means the Offering Memorandum dated March 5, 1999
pursuant to which the Notes issued on the Issue Date were offered.
"OFFICER," with respect to any Person (other than the Trustee), means the
Chairman of the Board of Directors, Chief Executive Officer, the President, any
Vice President and the Chief Financial Officer, the Controller, the Treasurer or
the Secretary of such Person, or any other officer of such Person designated by
the Board of Directors of such Person and set forth in an Officers' Certificate
delivered to the Trustee.
"OFFICERS' CERTIFICATE" means, with respect to any Person, a certificate
signed by the Chief Executive Officer, the President or any Vice President and
the Chief Financial Officer or any Treasurer of such Person that shall comply
with applicable provisions of this Indenture.
"OPINION OF COUNSEL" means a written opinion reasonably satisfactory in
form and substance to the Trustee from legal counsel, which counsel is
reasonably acceptable to the Trustee, including the matters required by Section
11.05 hereof and delivered to the Trustee.
"PAYMENT DEFAULT" means any default, whether or not any requirement for the
giving of notice, the lapse of time or both, or any other condition to such
default becoming an event of default has occurred, in the payment of principal
of (or premium, if any) or interest on or any other amount payable in connection
with Designated Senior Indebtedness.
"PERMITTED INDEBTEDNESS" means:
(i) Indebtedness of the Company or a Guarantor arising under or in
connection with the New Credit Facilities in an aggregate principal amount
at any time outstanding not to exceed the greater of (i) $430,000,000 and
(ii) the sum of (x) 75.0% of the net book value of accounts receivable of
the Company and its Restricted Subsidiaries plus (y) 50.0% of the net book
value of inventory of the Company and its Restricted Subsidiaries plus (z)
$290,000,000;
(ii) Indebtedness under the Notes and any Guarantees;
-15-
(iii) Indebtedness of the Company owed to and held by any Guarantor
which is unsecured and subordinated in right of payment to the payment
and performance of the Company's obligations under this Indenture and the
Notes and Indebtedness of any Restricted Subsidiary owed to and held by the
Company or another Guarantor; PROVIDED that (a) any sale or other
disposition of any Indebtedness of the Company or any Restricted Subsidiary
referred to in this clause (iii) to a Person (other than the Company or a
Guarantor), (b) any sale or other disposition of Capital Stock of any
Guarantor which holds Indebtedness of the Company or another Restricted
Subsidiary such that such Guarantor ceases to be a Guarantor of the Company
and (c) the Designation of a Guarantor that holds Indebtedness of the
Company or any other Restricted Subsidiary as an Unrestricted Subsidiary
shall be deemed to be an incurrence of Indebtedness not constituting
Permitted Indebtedness by the issuer of such Indebtedness;
(iv) Purchase Money Indebtedness and Capitalized Lease Obligations
incurred to acquire property in the ordinary course of business in an
aggregate principal amount outstanding not to exceed, together with all
other Indebtedness outstanding under this clause (iv), at the time of any
such incurrence and after giving PRO FORMA effect thereto, 3.0% of the
consolidated tangible assets of the Company and its Restricted Subsidiaries
as of the end of the most recent fiscal quarter for which consolidated
financial statements are available ending on or prior to the date of
determination;
(v) Interest Rate Agreements relating to Indebtedness of the
Company or any Restricted Subsidiary (which Indebtedness (a) bears interest
at fluctuating interest rates and (b) is otherwise permitted to be incurred
pursuant to Section 4.06 hereof); PROVIDED that the notional principal
amount of such Interest Rate Agreements, at the time of the incurrence
thereof, does not exceed the principal amount of the Indebtedness to which
such Interest Rate Agreements relate;
(vi) Indebtedness under Currency Agreements; PROVIDED that in the
case of Currency Agreements which relate to Indebtedness, such Currency
Agreements do not increase the principal amount of Indebtedness of the
Company and its Restricted Subsidiaries outstanding other than as a result
of fluctuations in foreign currency exchange rates or by reason of fees,
indemnities or compensation payable thereunder;
(vii) Indebtedness of the Company or any Restricted Subsidiary in
respect of reimbursement obligations relating to undrawn standby letters
of credit issued for the account of the Company of such Restricted
Subsidiary, as the case may be, in connection with workers' compensation
claims, self insurance or other similar reimbursement type obligations;
-16-
(viii) Indebtedness of the Company or any Restricted Subsidiary in
respect of bid, performance, surety and appeal bonds provided in the
ordinary course of business;
(ix) additional Indebtedness of the Company or the Guarantors not
to exceed $40,000,000 in aggregate principal amount at any one time
outstanding which may, but need not be, incurred under the New Credit
Facilities;
(x) Refinancing Indebtedness;
(xi) Indebtedness of the Company or any of its Restricted
Subsidiaries in respect of accommodation guarantees for the benefit of
trade creditors of any such person, trade letters of credit, standby
letters of credit, performance bonds, bankers' acceptances and surety
bonds, in each case, incurred in the ordinary course of business in an
aggregate principal amount not in excess of $5,000,000 at any one time
outstanding; and
(xii) Indebtedness outstanding on the Issue Date except for
indebtedness incurred pursuant to clause (i) or (ii) above.
"PERMITTED INVESTMENTS" means Investments made on or after the Issue Date
consisting of:
(i) Investments by the Company, or by a Restricted Subsidiary
thereof, in the Company or a Restricted Subsidiary;
(ii) Investments by the Company, or by a Restricted Subsidiary
thereof, in a Person, if as a result of such Investment (a) such Person
becomes a Restricted Subsidiary of the Company or (b) such Person is
merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or
a Restricted Subsidiary thereof;
(iii) Investments in Cash Equivalents;
(iv) reasonable and customary loans and advances made to employees
not to exceed $5,000,000 in the aggregate at any one time outstanding;
(v) an Investment that is made by the Company or a Restricted
Subsidiary thereof in the form of any Capital Stock, bonds, notes,
debentures or other securities that are issued by a third party to the
Company or such Restricted Subsidiary solely as partial consideration for
the consummation of an Asset Sale that is permitted pursuant to Section
4.10 hereof;
-17-
(vi) Investments in Unrestricted Subsidiaries in an amount not to
exceed, together with the amount of all other Investments outstanding
under this clause (vi), at the time of such Investment and after giving
PRO FORMA effect thereto, 4.0% of the consolidated tangible assets of the
Company and its Restricted Subsidiaries as of the end of the most recent
fiscal quarter for which consolidated financial statements are available
ending on or prior to the date of determination (with the amount of each
Investment being measured at the time made and without giving effect to
subsequent changes in value);
(vii) any acquisition of assets in exchange for the Capital Stock
(other than Disqualified Capital Stock) of the Company; and
(viii) Investments in securities of trade creditors or customers
received in settlement of obligations that arose in the ordinary course
of business pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of such trade creditors or customers.
"PERMITTED LIENS" means (i) Liens on Property or assets of, or any Capital
Stock of, any corporation existing at the time such assets are acquired by the
Company or any of its Restricted Subsidiaries, whether by merger, amalgamation,
consolidation, purchase of assets or otherwise; PROVIDED (x) that such Liens are
not created, incurred or assumed in connection with, or in contemplation of,
such assets being acquired by the Company or its Restricted Subsidiaries and (y)
that any such Lien does not extend to or cover any Property, Capital Stock or
Indebtedness other than the Property, Capital Stock or Indebtedness being
acquired, (ii) Liens securing Refinancing Indebtedness; PROVIDED that any such
Lien does not extend to or cover any Property, Capital Stock or Indebtedness
other than the Property, Capital Stock or Indebtedness securing the Indebtedness
so refunded, refinanced or extended, (iii) Liens in favor of the Company or any
Guarantor, (iv) Liens to secure Purchase Money Indebtedness that is otherwise
permitted to be incurred under this Indenture; PROVIDED that (a) any such Lien
is created solely for the purpose of securing Indebtedness representing, or
incurred to finance, refinance or refund, the cost (including sales and excise
taxes, installation and delivery charges and other direct costs of, and other
direct expenses paid or charged in connection with, such purchase or
construction) of the Property so acquired, (b) the principal amount of the
Indebtedness secured by such Lien does not exceed 100% of such costs and
expenses, and (c) such Lien does not extend to or cover any Property other than
such item of Property and any improvements on such item, (v) statutory liens or
landlords', carriers', warehousemen's, unemployment insurance, surety or appeal
bonds, mechanics', suppliers', materialmen's, repairmen's or other like Liens
imposed by law arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate
proceedings, (vi) Liens existing on the Issue Date, (vii) Liens securing only
the Notes or the Guarantees, (viii) Liens for taxes, assessments or governmental
charges that are
-18-
being contested in good faith by appropriate proceedings; PROVIDED that any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor, (ix) Liens securing Capitalized Lease
Obligations permitted to be incurred under clause (v) of the definition of
"Permitted Indebtedness"; PROVIDED that such Lien does not extend to any
Property other than that subject to the underlying lease, (x) Liens securing
Indebtedness permitted to be incurred under clause (i) of the definition of
"Permitted Indebtedness," (xi) Liens securing obligations under Interest Rate
Agreements and Currency Agreements, in each case permitted to be incurred under
this Indenture, (xii) Liens created or deposits made to secure the performance
of tenders, bids, leases, statutory obligations, government contracts,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business, (xiii) 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, (xiv) other Liens securing obligations
incurred in the ordinary course of business, which obligations do not exceed
$1.0 million in the aggregate at any one time outstanding, (xv) Liens arising
pursuant to Sale and Lease-Back transactions entered into in compliance with
this Indenture, (xvi) Liens securing Indebtedness permitted to be incurred under
clause (ix) or (xi) of the definition of "Permitted Indebtedness"; (xvii) Liens
incurred in the ordinary course of business of the Company or any Restricted
Subsidiary of the Company with respect to obligations that do not exceed
$5,000,000 at any one time outstanding and that (a) are not incurred in
connection with the borrowing of money or the obtaining of advances or credit
(other than trade credit in the ordinary course of business) and (b) do not in
the aggregate materially detract from the value of the property or materially
impair the use thereof in the operation of business by the Company or such
Restricted Subsidiary; (xviii) the Lien of any judgment rendered which is being
contested diligently and in good faith by appropriate proceedings by the Company
or any of its Restricted Subsidiaries and which does not have a material adverse
effect on the ability of the Company and its Restricted Subsidiaries to operate
the business or operations of the Company; (xix) reservations, limitations,
provisos and conditions expressed in any original grants from the Crown which do
not materially adversely impair the use of the subject property by the Company
or a Restricted Subsidiary; (xx) servitudes, licenses, easements, rights-of-way
and rights in the nature of easements (including, without in any way limiting
the generality of the foregoing, servitudes, licenses, easements, rights-of-way
and rights in the nature of easements for sidewalks, public ways, sewers,
drains, gas, steam and water mains or electric light and power, or telephone and
telegraph conduits, poles, wires and cable) which do not in the aggregate
materially adversely impair the use of the subject property by the Company or a
Restricted Subsidiary or in respect to which the Company or any of its
Restricted Subsidiaries has made satisfactory arrangement for relocation so that
such use will not in the aggregate be materially and adversely impaired; (xxi)
zoning and building by-laws and ordinances, municipal by-laws and regulations,
and restrictive covenants, which do not materially adversely interfere with the
use of the subject property by the Company or a Restricted Subsidiary; (xxii)
with respect to personal property only, Liens arising pursuant to registration
under the Personal Property Act (British Columbia)
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and similar legislation in other provinces or jurisdictions exclusively relating
to property and assets subject to equipment leases which are not Capitalized
Lease Obligations and (xxiii) any extension, renewal or replacement, in whole or
in part, of any Lien described in the foregoing clauses (i), (ii) or (vi) above;
PROVIDED that any such extension, renewal or replacement shall not on the whole
be materially more restrictive than the Lien so extended, renewed or replaced
and shall not extend to any other Property of the Company or its Subsidiaries
other than such item of Property originally covered by such Lien or by
improvement thereon or additions or accessions thereto.
"PERMITTED RESTRUCTURING DISTRIBUTIONS" means the direct or indirect
payment of interest, dividends or other distributions to Pacifica Paper Limited
Partnership in an aggregate amount not to exceed $18,000,000 million.
"PERSON" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government (including any agency or political subdivision
thereof).
"PHYSICAL NOTES" means certificated Notes in registered form in
substantially the form set forth in EXHIBIT A.
"POWERCO" means Pacifica Power Co. Ltd. together with any other Restricted
Subsidiary of the Company all or substantially all of whose principal assets in
aggregate consist of the Xxxx Xxxx hydroelectric facility or the Xxxxxx River
hydroelectric facility (together with all related assets, licenses and permits),
which assets were all beneficially owned by Pacifica Power Co. Ltd. on the Issue
Date.
"PREFERRED STOCK" means any Capital Stock of a Person, however designated,
which entitles the holder thereof to a preference with respect to dividends,
distributions or liquidation proceeds of such Person over the holders of other
Capital Stock issued by such Person.
"PRIVATE EXCHANGE" has the meaning set forth in the Registration Rights
Agreement.
"PRIVATE EXCHANGE NOTES" has the meaning set forth in the Registration
Rights Agreement.
"PRIVATE PLACEMENT LEGEND" means a legend in the form set forth in
EXHIBIT B.
"PROPERTY" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person and its Subsidiaries under
GAAP.
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"PUBLIC EQUITY OFFERING" means a public offering of shares of Common Stock
(however designated and whether voting or non-voting) and any and all rights,
warrants, receipts or options to acquire such Common Stock of the Company
pursuant to a registration statement filed with the Commission in accordance
with the Securities Act or pursuant to a prospectus filed with the appropriate
securities regulatory authorities in any province of Canada. For the purposes of
this definition of "Public Equity Offering," any offering of securities
specified in this definition prior to June 1, 2000 that (1) does not satisfy the
criteria required for a Public Equity Offering because such securities are not
sold pursuant to a registration statement filed with the Commission in
accordance with the Securities Act or pursuant to a prospectus filed with the
appropriate securities regulatory authorities in a province of Canada and (2)
becomes eligible for resale to the general public in any province or territory
of Canada or the United States within 90 days of the date on which such
securities were initially sold, shall be deemed to be a Public Equity Offering
on and as of the date upon which such securities become eligible for such
resale.
"PURCHASE AGREEMENT" means the Purchase Agreement dated March 5, 1999 by
and among the Company, the Guarantors and the Initial Purchasers.
"PURCHASE MONEY INDEBTEDNESS" means any Indebtedness incurred by a Person
to finance the cost (including the cost of construction, installation or
improvement) of an item of Property, the principal amount of which Indebtedness
does not exceed the sum of (i) the lesser of (A) the Fair Market Value of such
property or (B) 100% of such cost and (ii) reasonable fees and expenses of such
Person incurred in connection therewith.
"QUALIFIED INSTITUTIONAL BUYER" or "QIB" shall have the meaning specified
in Rule 144A promulgated under the Securities Act.
"RATING AGENCIES" means (i) S&P and (ii) Xxxxx'x and (iii) if S&P or
Xxxxx'x or both shall not make a rating of the Notes publicly available, a
nationally recognized United States securities rating agency or agencies, as the
case may be, selected by the Company, which shall be substituted for S&P or
Xxxxx'x or both, as the case may be.
"RATING CATEGORY" means (i) with respect to S&P, any of the following
categories: BB, B, CCC, CC, C and D (or equivalent successor categories); (ii)
with respect to Xxxxx'x, any of the following categories: Ba, B, Caa, Ca, C and
D (or equivalent successor categories); and (iii) the equivalent of any such
category of S&P or Xxxxx'x used by another Rating Agency. In determining whether
the rating of the Notes has decreased by one or more gradations, gradations
within Rating Categories (+ and - for S&P; 1, 2 and 3 for Xxxxx'x; or the
equivalent gradations for another Rating Agency) shall be taken into account
(e.g., with respect to S&P, a decline in rating from BB+ to BB, as well as from
BB- to B+, will constitute a decrease of one gradation).
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"RATING DATE" means the date which is 90 days prior to the earlier of (x) a
Change of Control and (y) public notice of the occurrence of a Change of Control
or of the intention by the Company to effect a Change of Control.
"RATING DECLINE" means the decrease (as compared with the Rating Date) by
one or more gradations (including gradations within Rating Categories as well as
between Rating Categories) of the rating of the Notes by either Rating Agency
on, or within 120 days after the earlier of the date of public notice of the
occurrence of a Change of Control or of the intention by the Company to effect a
Change of Control (which period shall be extended for so long as the rating of
the Notes is under publicly announced consideration for possible downgrade by
any of the Rating Agencies).
"REDEMPTION DATE" when used with respect to any Note to be redeemed means
the date fixed for such redemption pursuant to the terms of the Notes.
"REFINANCING INDEBTEDNESS" means Indebtedness that replaces, refunds,
renews, refinances or extends any Indebtedness of the Company or a Restricted
Subsidiary permitted to be incurred by the Company or its Restricted
Subsidiaries pursuant to Section 4.06 hereof (other than pursuant to clauses
(i), (iv), (v), (vi), (vii), (viii) and (ix) of the definition of "Permitted
Indebtedness"), but only to the extent that (i) the Refinancing Indebtedness is
subordinated to the Notes to at least the same extent as the Indebtedness being
replaced, refunded, renewed, refinanced or extended, if at all, (ii) the
Refinancing Indebtedness is scheduled to mature either (a) no earlier than the
Indebtedness being replaced, refunded, renewed, refinanced or extended, or (b)
after the maturity date of the Notes, (iii) the portion, if any, of the
Refinancing Indebtedness that is scheduled to mature on or prior to the maturity
date of the Notes has a weighted average life to maturity at the time such
Refinancing Indebtedness is incurred that is equal to or greater than the
weighted average life to maturity of the portion of the Indebtedness being
replaced, refunded, renewed, refinanced or extended that is scheduled to mature
on or prior to the maturity date of the Notes, and (iv) such Refinancing
Indebtedness is in an aggregate principal amount that is equal to or less than
the sum of (a) the aggregate principal amount then outstanding under the
Indebtedness being replaced, refunded, renewed, refinanced or extended, (b) the
amount of accrued and unpaid interest, if any, and premiums owed, if any, not in
excess of preexisting prepayment provisions on such Indebtedness being replaced,
refunded, renewed, refinanced or extended and (c) the amount of customary fees,
expenses and costs related to the incurrence of such Refinancing Indebtedness.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
dated March 12, 1999 among the Company, the Guarantors and the Initial
Purchasers, as amended from time to time.
"REGULATION S" means Regulation S promulgated under the Securities Act.
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"REORGANIZATION" means the reorganization of Pacifica Paper Limited
Partnership into a corporation whereupon the former partners of Pacifica Paper
Limited Partnership shall become the shareholders of the successor corporation
thereto.
"REORGANIZATION MERGER" means the amalgamation by and among the successor
corporation to Pacifica Paper Limited Partnership as a result of the
Reorganization, 560081 B.C. Ltd., Pacifica Holdings Ltd. and the Company.
"REPLACEMENT ASSETS" means (i) properties or assets (other than cash or
Cash Equivalents or any Capital Stock or other security) that will be used or
useful in the business of the Company or its Restricted Subsidiaries as
conducted on the Issue Date, or in businesses reasonably similar to or ancillary
to the business of the Company or its Restricted Subsidiaries as conducted on
the Issue Date or (ii) Capital Stock of any Person that will become on the date
of acquisition thereof a Guarantor as a result of such acquisition.
"RESPONSIBLE OFFICER" when used with respect to the Trustee, means an
officer or assistant officer assigned to the corporate trust department of the
Trustee (or any successor group of the Trustee) with direct responsibility for
the administration of this Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"RESTRICTED NOTE" has the same meaning as "Restricted Security" set forth
in Rule 144(a)(3) promulgated under the Securities Act; PROVIDED, that the
Trustee shall be entitled to request and conclusively rely upon an Opinion of
Counsel with respect to whether any Note is a Restricted Note.
"RESTRICTED PAYMENT" means any of the following: (i) the declaration or
payment of any dividend or any other distribution or payment on Capital Stock of
the Company or any Restricted Subsidiary of the Company or any payment made to
the direct or indirect holders (in their capacities as such) of Capital Stock of
the Company or any Restricted Subsidiary of the Company (other than (x)
dividends or distributions payable solely in Capital Stock (other than
Disqualified Capital Stock) of the Company, and (y) in the case of Restricted
Subsidiaries of the Company, dividends or distributions payable to the Company
or to a Restricted Subsidiary of the Company), (ii) the purchase, redemption or
other acquisition or retirement for value of any Capital Stock of the Company or
any of its Restricted Subsidiaries (other than Capital Stock owned by the
Company or a Restricted Subsidiary of the Company), (iii) the making of any
principal payment on, or the purchase, defeasance, repurchase, redemption 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 or any Guarantor which is subordinated in right of payment to the
Notes or such Guarantor's Guarantee, as the case may be (other than any such
Indebtedness acquired in anticipation of satisfying a scheduled sinking fund
obligation, principal installment or final
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maturity in each case due within one year of the date of acquisition), (iv) the
making of any Investment other than a Permitted Investment, (v) the designation
of any Subsidiary of the Company as an Unrestricted Subsidiary (a
"DESIGNATION"); PROVIDED that the Designation of a Subsidiary of the Company as
an Unrestricted Subsidiary shall be deemed to include the Designation of all of
the Subsidiaries of such Subsidiary and (vi) the forgiveness of any Indebtedness
of an Affiliate of the Company owed to the Company or a Restricted Subsidiary of
the Company. In determining the amount of any Restricted Payment, cash
distributed or invested shall be valued at the face amount thereof and Property
other than cash shall be valued at its Fair Market Value, except that, in
determining the amount of any Restricted Payment made under clause (v) above,
the amount of such Restricted Payment (the "DESIGNATION AMOUNT") shall be equal
to the greater of (i) the book value or (ii) the Fair Market Value of the
Company's proportionate interest in such Subsidiary on such date.
"RESTRICTED SUBSIDIARY" means a Subsidiary of the Company other than an
Unrestricted Subsidiary.
"RULE 144" means Rule 144 promulgated under the Securities Act.
"RULE 144A" means Rule 144A promulgated under the Securities Act.
"SALE AND LEASE-BACK TRANSACTION" means any arrangement with any Person
providing for the leasing by the Company or any Restricted Subsidiary of the
Company of any real or tangible personal property, which property has been or is
to be sold or transferred by the Company or such Restricted Subsidiary to such
Person in contemplation of such leasing.
"SECURITIES ACT" means the U.S. Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Subsidiary" of any specified Person means any corporation, partnership,
joint venture, limited liability company, association or other business entity,
whether now existing or hereafter organized or acquired, (i) in the case of a
corporation, of which more than 50% of the total voting power of the Capital
Stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, officers or trustees thereof is held by such
first-named Person or any of its Subsidiaries; or (ii) in the case of a
partnership, joint venture, limited liability company, association or other
business entity, with respect to which such first-named Person or any of its
Subsidiaries has the power to direct or cause the direction of the management
and policies of such entity by contract or otherwise or if in accordance with
GAAP such entity is consolidated with the first-named Person for financial
statement purposes.
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"TAXES" means any present or future tax, duty, levy, impost, assessment or
other government charge (including penalties, interest and any other liabilities
related thereto) imposed or levied by or on behalf of a Taxing Authority.
"TAXING AUTHORITY" means any government or any political subdivision or
province or territory of Canada or any authority or agency therein or thereof
having power to tax.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code -Section-
77aaa-77bbbb) as in effect on the date of this Indenture (except as provided in
Section 9.03 hereof).
"TRUSTEE" means the party named as such in this Indenture until a successor
replaces it pursuant to this Indenture and thereafter means the successor.
"UNRESTRICTED SUBSIDIARY" means (a) any Subsidiary of an Unrestricted
Subsidiary and (b) any Subsidiary of the Company which is classified after the
Issue Date as an Unrestricted Subsidiary by a resolution adopted by the Board of
Directors of the Company; PROVIDED that a Subsidiary may be so classified as an
Unrestricted Subsidiary only if such classification is in compliance with
Section 4.07 hereof; PROVIDED FURTHER that the Board of Directors of the Company
may not designate any Subsidiary of the Company to be an Unrestricted Subsidiary
if, after such designation, such Subsidiary owns any Capital Stock of, or owns
or holds any Lien on any property of, any Restricted Subsidiary which is not a
Subsidiary of the Subsidiary to be so designated. The Trustee shall be given
prompt notice by the Company of each resolution adopted by the Board of
Directors of the Company under this provision, together with a copy of each such
resolution adopted.
"U.S. GOVERNMENT OBLIGATIONS" means (a) securities that are direct
obligations of the United States of America for the payment of which its full
faith and credit are pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the 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 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 a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt.
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"U.S." and "UNITED STATES" means the United States of America, its
territories and possessions, any state of the United States, and the District of
Columbia.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" means any Restricted Subsidiary, all
of the outstanding voting securities (other than directors' qualifying shares or
similar requirements of law) of which are owned, directly or indirectly, by the
Company or another Wholly Owned Restricted Subsidiary.
SECTION 1.02. OTHER DEFINITIONS.
The definitions of the following terms may be found in the sections
indicated as follows:
Term Defined in Section
---- ------------------
"actual notice"........................................................ 7.02
"Additional Amounts"................................................... 4.16
"Affiliate Transaction"................................................ 4.09
"Bankruptcy Law"....................................................... 6.01
"Business Day"......................................................... 11.07
"CEDEL"................................................................ 2.16(a)
"Change of Control Offer".............................................. 4.15
"Change of Control Payment Date"....................................... 4.15
"Change of Control Purchase Price"..................................... 4.15
"Covenant Defeasance".................................................. 9.03
"Custodian"............................................................ 6.01
"Deficiency"........................................................... 4.10
"DTC Agent Members".................................................... 2.16(a)
"Euroclear"............................................................ 2.16(a)
"Events of Default".................................................... 6.01
"Excess Proceeds Offer"................................................ 4.10
"Excluded Holder"...................................................... 4.16
"Fifth Anniversary".................................................... 4.10
"Global Notes"......................................................... 2.16(a)
"Legal Defeasance"..................................................... 9.02
"Legal Holiday"........................................................ 11.07
"Offer Period"......................................................... 4.10
"Other Notes".......................................................... 2.02
"Paying Agent"......................................................... 2.04
"Registrar"............................................................ 2.04
"Regulation S Global Note"............................................. 2.16(a)
"Regulation S Notes"................................................... 2.02
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Term Defined in Section
---- ------------------
"Restricted Global Note"............................................... 2.16(a)
"Rule 144A Notes"...................................................... 2.02
"Successor Company".................................................... 5.01
"25% Available Asset Sale Proceeds".................................... 4.10
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the portion
of such provision required to be incorporated herein in order for this Indenture
to be qualified under the TIA 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 SECURITYHOLDER" means a Holder or Noteholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee.
"OBLIGOR ON THE INDENTURE SECURITIES" means the Company, any
Guarantors or any other obligor on the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined in the TIA by reference to another statute or defined by Commission rule
have the meanings therein assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and in the plural
include the singular;
(d) words used herein implying any gender shall apply to both genders;
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(e) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or Subsection;
(f) unless otherwise specified herein, all accounting terms used
herein shall be interpreted, all accounting determinations hereunder shall be
made, and all financial statements required to be delivered hereunder shall be
prepared in accordance with GAAP as in effect from time to time, applied on a
basis consistent with the most recent audited consolidated financial statements
of the Company;
(g) "U.S. Dollars," "United States Dollars" and "US$" each refer to
United States dollars, or such other money of the United States that at the time
of payment is legal tender for payment of public and private debts; and "$" and
"Cdn $" each refer to Canadian Dollars, or such other money of Canada that at
the time of payment is legal tender for payment of public and private debts; and
(h) whenever in this Indenture there is mentioned, in any context,
principal, interest or any other amount payable under or with respect to any
Note, such mention shall be deemed to include mention of the payment of
Additional Interest to the extent that, in such context, Additional Interest is,
was or would be payable in respect thereof.
ARTICLE TWO
THE NOTES
SECTION 2.01. AMOUNT OF NOTES.
The Trustee shall authenticate Notes for original issue on the Issue
Date in the aggregate principal amount of US$200,000,000 upon receipt of a
written order of the Company in the form of an Officers' Certificate of the
Company. Such written order shall specify the amount of Notes to be
authenticated and the date on which the Notes are to be authenticated.
Upon receipt of a Company Request and an Officers' Certificate of the
Company certifying that a registration statement relating to an exchange offer
specified in the Registration Rights Agreement is effective under the Securities
Act and that the conditions precedent to a Private Exchange thereunder have been
met, the Trustee shall authenticate an additional series of Notes in an
aggregate principal amount not to exceed US$200,000,000 for issuance in exchange
for the Notes tendered for exchange pursuant to such exchange offer registered
under the Securities Act and not bearing a Private Placement Legend or pursuant
to a Private Exchange. Exchange Notes or Private Exchange Notes may have such
distinctive
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series designations and such changes in the form thereof as are specified in the
Company Request referred to in the preceding sentence.
SECTION 2.02. FORM AND DATING.
The Notes and the Trustee's certificate of authentication with respect
thereto shall be substantially in the form set forth in EXHIBIT A, which is
incorporated in and forms a part of this Indenture. The Notes may have
notations, legends or endorsements required by law, rule or usage to which the
Company is subject. Without limiting the generality of the foregoing, Notes
offered and sold to Qualified Institutional Buyers in reliance on Rule 144A
("RULE 144A NOTES") shall bear the Private Placement Legend and include the form
of assignment set forth in EXHIBIT B, Notes offered and sold in offshore
transactions in reliance on Regulation S ("REGULATION S NOTES") shall bear the
Private Placement Legend and include the form of assignment set forth in
EXHIBIT B. Notes offered and sold to Institutional Accredited Investors that are
not QIBs in transactions exempt from registration under the Securities Act not
made in reliance on Rule 144A or Regulation S ("OTHER NOTES") shall be
represented by a Physical Note bearing the Private Placement Legend. Each Note
shall be dated the date of its authentication. The Notes shall be issuable only
in registered form without coupons in denominations of US$1,000 and any integral
multiple thereof.
Upon the occurrence of the Exchange Offer in accordance with the
Registration Rights Agreement, Exchange Notes issued by the Company shall be
substantially in the form set forth in EXHIBIT A (but shall not contain
paragraph 10 thereof).
The terms and provisions contained in the Notes shall constitute, and
are expressly made, a part of this Indenture and, to the extent applicable, the
Company, any Guarantors and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and agree to be bound
thereby. However, to the extent any provision of the Notes conflicts with the
provisions of this Indenture, the provisions of this Indenture shall govern and
be controlling.
The Notes may be presented for registration of transfer and exchange
at the offices of the Registrar.
SECTION 2.03. EXECUTION AND AUTHENTICATION.
One Officer shall sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note was an Officer at the time
of such execution but no longer holds that office at the time the Trustee
authenticates the Note, the Note shall be valid nevertheless.
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At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Notes executed by the Company to the
Trustee for authentication, together with a Company Request for authentication
and delivery of such Notes, and the Trustee, in accordance with such Company
Request, shall authenticate and deliver such Notes.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder. Notwithstanding the foregoing, if
any Note shall have been authenticated and delivered hereunder but never issued
and sold by the Company, and the Company shall deliver such Note to the Trustee
for cancellation as provided in Section 2.12, for all purposes of this Indenture
such Note shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
Upon prior notice to, and approval by (which approval shall not be
unreasonably withheld), the Company, the Trustee may appoint an authenticating
agent to authenticate the Notes. Unless otherwise provided in the appointment,
an authenticating agent may authenticate the 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 and Affiliates of the Company. Each Paying Agent
is designated as an authenticating agent for purposes of this Indenture.
SECTION 2.04. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency (which shall be located
in the Borough of Manhattan in The City of New York, State of New York) where
Notes may be presented for registration of transfer or for exchange (the
"REGISTRAR"), and an office or agency where Notes may be presented for payment
(the "PAYING AGENT") and an office or agency where notices and demands to or
upon the Company, if any, in respect of the Notes and this Indenture may be
served. The Registrar shall keep a register (the "REGISTER") of the names and
address of the Holders and the Notes and of their transfer and exchange. The
Company may have one or more additional Paying Agents. The term "Paying Agent"
includes any additional Paying Agent. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company or any of its Subsidiaries
may act as Paying Agent or Registrar.
The Company shall enter into an appropriate agency agreement, which
shall incorporate applicable provisions of the TIA, with any Agent that is not a
party to this Indenture. The agreement shall implement the provisions of this
Indenture that relate to such
-30-
Agent. The Company shall notify the Trustee of the name and address of any such
Agent. If the Company fails to maintain a Registrar or Paying Agent, or fails to
give the foregoing notice, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with Section 7.07.
The Company initially appoints the Trustee as Registrar, Paying Agent
and Agent for service of notices and demand (subject to Section 11.09 hereof) in
connection with the Notes and this Indenture.
SECTION 2.05. PAYING AGENT TO HOLD MONEY IN TRUST.
Each Paying Agent shall hold in trust for the benefit of the Holders
or the Trustee all money held by the Paying Agent for the payment of principal
of or premium or interest on the Notes (whether such money has been paid to it
by the Company or any other obligor on the Notes or any Guarantor), and the
Company and the Paying Agent shall notify the Trustee in writing of any default
by the Company (or any other obligor on the Notes or any Guarantor) in making
any such payment. Money held in trust by the Paying Agent need not be segregated
except as required by law and in no event shall the Paying Agent be liable for
any interest on any money received by it hereunder. The Company at any time may
require the Paying Agent to pay all money held by it to the Trustee and account
for any funds disbursed and the Trustee may at any time during the continuance
of any Event of Default specified in clauses (1) or (2) of Section 6.01 hereof,
upon written request to the Paying Agent, require such Paying Agent to pay
forthwith all money so held by it to the Trustee and to account for any funds
disbursed. Upon making such payment, the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.06. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders. Such list shall be in written form or any other form capable of
being converted into written form within a reasonable time. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least five
Business Days before each Interest Payment Date, and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders. The
Trustee may rely on the lists of Holders provided by the Company.
SECTION 2.07. TRANSFER AND EXCHANGE.
Subject to Sections 2.16 and 2.17 hereof, when Notes are presented to
the Registrar with a request from the Holder of such Notes to register a
transfer or to exchange them for an equal principal amount of Notes of other
authorized denominations, the Registrar
-31-
shall register the transfer as requested. Every Note presented or surrendered
for registration of transfer or exchange shall be duly endorsed or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Registrar, duly executed by the Holder thereof or its attorneys
duly authorized in writing. To permit registrations of transfers and exchanges,
the Company shall issue and execute and the Trustee shall authenticate new Notes
evidencing such transfer or exchange at the Registrar's request in accordance
with Section 2.03 hereof. No service charge shall be made to the Holder for any
registration of transfer or exchange. The Company may require from the Holder
payment of a sum sufficient to cover any transfer taxes or other governmental
charge that may be imposed in relation to a transfer or exchange, but this
provision shall not apply to any exchange pursuant to Section 2.11, 3.06, 4.10,
4.15 or 8.05 hereof (in which events the Company shall be responsible for the
payment of such taxes). The Registrar shall not be required to exchange or
register a transfer of any Note for a period of 15 days immediately preceding
the mailing of notice of redemption of Notes to be redeemed or of any Note
selected, called or being called for redemption except the unredeemed portion of
any Note being redeemed in part.
Any Holder of a Global Note shall, by acceptance of such Global Note,
agree that transfers of the beneficial interests in such Global Note may be
effected only through a book entry system maintained by the Holder of such
Global Note (or its agent), and that ownership of a beneficial interest in a
Global Note shall be required to be reflected in a book entry.
Each Holder of a Note agrees to indemnify the Company and the Trustee
against any liability that may result from the transfer, exchange or assignment
of such Holder's Note in violation of any provision of this Indenture and/or
applicable U.S. federal or state securities laws or Canadian provincial
securities laws.
Neither the Trustee nor the Registrar shall have any duty to monitor
the Company's compliance with or have any responsibility with respect to the
Company's compliance with any U.S. federal or state securities laws or Canadian
provincial securities laws.
SECTION 2.08. REPLACEMENT NOTES.
If a mutilated Note is surrendered to the Registrar or the Trustee, or
if the Holder of a Note claims that the Note has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Note if (i) the Holder of such Note furnishes to the Company and the
Trustee evidence reasonably acceptable to them of the ownership and the
destruction, loss or theft of such Note and (ii) the requirements of Section
8-405 of the New York Uniform Commercial Code (or applicable provision at the
time of such replacement) are met. If required by the Trustee or the Company, an
indemnity bond shall be posted, sufficient in the judgment of both to protect
the Company, any
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Guarantors, the Trustee or any Paying Agent from any loss that any of them may
suffer if such Note is replaced. The Company may charge such Holder for the
Company's reasonable out-of-pocket expenses in replacing such Note and the
Trustee may charge the Company for the Trustee's expenses (including, without
limitation, attorneys' fees and disbursements) in replacing such Note. Every
replacement Note shall constitute a contractual obligation of the Company.
In case any such mutilated, destroyed, lost or stolen Note has become,
or will become within 30 days, due and payable, the Company in its discretion
may, instead of issuing a new Note, pay such Note.
SECTION 2.09. OUTSTANDING NOTES.
The Notes outstanding at any time are all Notes that have been
authenticated by the Trustee except for (a) those cancelled by it, (b) those
delivered to it for cancellation, (c) to the extent set forth in Sections 9.01
and 9.02 hereof, on or after the date on which the conditions set forth in
Section 9.01 or 9.02 hereof have been satisfied, those Notes theretofore
authenticated and delivered by the Trustee hereunder and (d) those described in
this Section 2.09 hereof as not outstanding. Subject to Section 2.10 hereof, a
Note does not cease to be outstanding because the Company or one of its
Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.08 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser in whose hands such Note is a
legal, valid and binding obligation of the Company.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, in its capacity as such, on any Maturity Date
or on any optional redemption date, money sufficient to pay all accrued interest
and principal with respect to the Notes payable on that date and is not
prohibited from paying such money to the Holders thereof pursuant to the terms
of this Indenture, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.10. TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any declaration of acceleration or notice of default or
direction, waiver or consent or any amendment, modification or other change to
this Indenture, Notes owned by the Company or any Person directly or indirectly
controlling or controlled by or under common control with the Company shall be
disregarded as though they were not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent or any amendment, modification or other change to
this Indenture, only Notes as to which the Trustee has received an Officers'
Certificate of the
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Company stating that such Notes are so owned shall be so disregarded. Notes so
owned which have been pledged in good faith shall not be disregarded if the
pledgee established to the satisfaction of the Trustee the pledgee's right so to
act with respect to the Notes and that the pledgee is not the Company, a
Guarantor, any other obligor on the Notes or any of their respective Affiliates.
SECTION 2.11. TEMPORARY NOTES.
Until definitive Notes are prepared and ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Notes which are
printed, lithographed, typewritten, mimeographed or otherwise produced in any
authorized denomination. Temporary Notes shall be substantially in the form of
definitive Notes but may have insertions, omissions, substitutions and other
variations that the Company considers appropriate for temporary Notes and that
the Company shall have identified to the Trustee in writing. Without
unreasonable delay, the Company shall prepare and the Trustee shall authenticate
definitive Notes in exchange for temporary Notes. Until such exchange, temporary
Notes shall be entitled to the same rights, benefits and privileges as
definitive Notes.
SECTION 2.12. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee shall cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall destroy cancelled Notes
and deliver a certificate of destruction thereof to the Company unless the
Company directs the Trustee in writing to deliver cancelled Notes to the
Company. The Company may not reissue or resell, or issue new Notes to replace,
Notes that the Company has redeemed or paid, or that have been delivered to the
Trustee for cancellation.
SECTION 2.13. DEFAULTED INTEREST.
If the Company defaults on a payment of interest on the Notes, it
shall pay the defaulted interest in any lawful manner, plus (to the extent
permitted by law) any interest payable on the defaulted interest, in accordance
with paragraph 1 of the Notes, to the Persons who are Holders on a subsequent
special record date, which date shall be at least five Business Days prior to
the payment date. The Company shall fix such special record date and payment
date in a manner satisfactory to the Trustee. At least 10 days before such
special record date, the Company shall mail to each Holder a notice that states
the special record date, the payment date and the amount of defaulted interest,
and interest payable on defaulted interest, if any, to be paid. The Company may
make payment of any defaulted interest in any other lawful manner not
inconsistent with the requirements (if applicable) of any securities exchange on
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which the Notes may be listed and, upon such notice as may be required by such
exchange, if, after written notice given by the Company to the Trustee of the
proposed payment pursuant to this sentence, such manner of payment shall be
deemed practicable by the Trustee.
SECTION 2.14. CUSIP NUMBER.
The Company in issuing the Notes may use one or more "CUSIP" numbers,
and if so, each such CUSIP number shall be included in notices of redemption or
exchange as a convenience to Holders; PROVIDED, that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes, and that reliance may be placed
only on the other identification numbers printed on the Notes. The Company shall
promptly notify the Trustee of any such CUSIP number used by the Company in
connection with the issuance of the Notes and of any change in the CUSIP number.
SECTION 2.15. DEPOSIT OF MONEYS.
Prior to 10:00 a.m., New York City time, on each Interest Payment Date
and the Maturity Date, the Company shall have deposited with the Paying Agent in
immediately available funds money sufficient to make cash payments due on such
Interest Payment Date or the Maturity Date, as the case may be, in a timely
manner which permits the Trustee to remit payment to the Holders on such
Interest Payment Date or the Maturity Date, as the case may be. Except as
otherwise provided herein, the principal and interest on Global Notes shall be
payable to DTC or the nominee of DTC, as the case may be, as the sole registered
owner and the sole holder of the Global Notes represented thereby. The principal
and interest on Physical Notes shall be payable, either in person or by mail, at
the office of the Paying Agent.
SECTION 2.16. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES.
(a) Rule 144A Notes initially shall be represented by one or more
notes in registered, global form without interest coupons (collectively, the
"RESTRICTED GLOBAL NOTE"). Regulation S Notes initially shall be represented by
one or more notes in registered, global form without interest coupons
(collectively, the "REGULATION S GLOBAL NOTE," and, together with the Restricted
Global Note and any other global notes representing Notes, the "GLOBAL NOTES").
The Global Notes shall each bear a legend as set forth in EXHIBIT C. The Global
Notes initially shall (i) be registered in the name of DTC or the nominee of
DTC, in each case, for credit to an account of DTC Agent Members (or, in the
case of the Regulation S Global Note, DTC Agent Members holding for Euroclear
System ("EUROCLEAR") and Cedel Bank, S.A. ("CEDEL")), (ii) be delivered to the
Trustee as custodian for DTC and (iii) in the case of the Restricted Global
Notes or the Regulation S Global Notes, bear legends as set forth in EXHIBIT B.
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Neither members of, nor direct or indirect participants in, DTC ("DTC
AGENT MEMBERS") shall have any rights under this Indenture with respect to any
Global Note held on their behalf by DTC, or the Trustee as its custodian, or
under the Global Notes, and DTC 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 by DTC or impair, as between DTC and DTC Agent Members,
the operation of customary practices governing the exercise of the rights of a
Holder of any Note.
(b) Transfers of Global Notes shall be limited to transfer in whole,
but not in part, to DTC, its successors or its nominees. Interests of beneficial
owners in the Global Notes may be transferred or exchanged for Physical Notes in
accordance with the rules and procedures of DTC, Euroclear and CEDEL and the
provisions of Section 2.17. In addition, a Global Note shall be exchangeable for
Physical Notes if (i) DTC (x) notifies the Company that it is unwilling or
unable to continue as depository for such Global Note and the Company thereupon
fails to appoint a successor depository or (y) has ceased to be a clearing
agency registered under the Exchange Act or otherwise ceases to be eligible as a
depositary, (ii) the Company, in its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of such Physical Notes, (iii) there
shall have occurred and be continuing an Event of Default with respect to the
Notes which has not been waived pursuant to section 6.04 of this Indenture or
(iv) in the case of the Regulation S Global Note held for the accounts of
Euroclear or CEDEL, Euroclear or CEDEL, as the case may be, is closed for 14
continuous days or announces an intention to cease or permanently ceases
business. In all cases, Physical Notes delivered in exchange for any Global Note
or beneficial interests therein shall be registered in the names, and issued in
any approved denominations, requested by or on behalf of DTC (in accordance with
its customary procedures).
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of such Global Note in an amount equal to the principal amount
of the beneficial interest in such Global Note to be transferred, and the
Company shall execute, and the Trustee shall upon receipt of a written order
from the Company authenticate and make available for delivery, one or more
Physical Notes of like tenor and amount.
(d) In connection with the transfer of any Global Note as an entirety
to beneficial owners pursuant to paragraph (b), such Global Note shall be deemed
to be surrendered to the Trustee for cancellation, and the Company shall
execute, and the Trustee shall authenticate and deliver, to each beneficial
owner identified by DTC in writing in
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exchange for its beneficial interest in such Global Note, an equal aggregate
principal amount of Physical Notes of authorized denominations.
(e) Any Physical Note delivered in exchange for an interest in a
Global Note that is a Restricted Note pursuant to paragraph (b), (c) or (d)
shall, except as otherwise provided by paragraph (c) of Section 2.17, bear the
Private Placement Legend unless the Company determines otherwise in compliance
with applicable law.
(f) On or prior to the 40th day after the later of the commencement of
the Offering and the Issue Date (such period through and including such 40th
day, the "RESTRICTED PERIOD"), a beneficial interest in the Regulation S Global
Note may be held only through Euroclear or CEDEL, as indirect participants in
DTC, unless transferred to a Person who takes delivery in the form of an
interest in the Restricted Global Note only upon receipt by the Trustee and the
Company of a written certification from the transferor to the effect that such
transfer is being made (i)(a) to a Person whom the transferor reasonably
believes is a Qualified Institutional Buyer in a transaction meeting the
requirements of Rule 144A or (b) pursuant to another exemption from the
registration requirements under the Securities Act which is accompanied by an
Opinion of Counsel regarding the availability of such exemption and (ii) in
accordance with all applicable securities laws of any state of the United
States, the provinces of Canada or any other jurisdiction.
(g) Beneficial interests in the Restricted Global Note may be
transferred to a Person who takes delivery in the form of an interest in the
Regulation S Global Note, whether before or after the expiration of the
Restricted Period, only if the transferor first delivers to the Trustee (i) a
written certificate to the effect that such transfer is being made in accordance
with Rule 903 or 904 of Regulation S or Rule 144 (if available) and that, if
such transfer occurs prior to the expiration of the Restricted Period, the
interest transferred will be held immediately thereafter through Euroclear or
CEDEL and (ii) at the option of the Trustee and the Company, an Opinion of
Counsel reasonably satisfactory to the Trustee and the Company to the effect
that such transfer is in accordance with Regulation S or Rule 144, as the case
may be.
(h) Any beneficial interest in a Global Note that is transferred to a
Person who takes delivery in the form of an interest in another Global Note
shall, upon transfer, cease to be an interest in such Global Note and become an
interest in such other Global Note and, accordingly, shall thereafter be subject
to all transfer restrictions and other procedures applicable to beneficial
interests in such other Global Note for as long as it remains such an interest.
(i) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including DTC Agent Members and Persons that may hold
interests through DTC
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Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Notes.
SECTION 2.17. SPECIAL TRANSFER PROVISIONS.
(a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS AND
NON-U.S. PERSONS. The following provisions shall apply with respect to the
registration of any proposed transfer of a Restricted Note to any Institutional
Accredited Investor which is not a QIB or to any Non-U.S. Person:
(i) the Registrar shall register the transfer of any Note, whether or
not such Note bears the Private Placement Legend, if (x) the requested
transfer is after March 15, 2001 or such other date as such Note shall be
freely transferable under Rule 144 as certified in an Officer's Certificate
or (y) (1) in the case of a transfer to an Institutional Accredited
Investor which is not a QIB (excluding Non-U.S. Persons), the proposed
transferee has delivered to the Registrar and the Company a certificate
substantially in the form of EXHIBIT D hereto and, at the option of the
Registrar and the Company, an Opinion of Counsel reasonably satisfactory to
the Registrar and the Company to the effect that such transfer is in
accordance with the Securities Act or (2) in the case of a transfer to a
Non-U.S. Person (including a QIB), the proposed transferor has delivered to
the Registrar and the Company a certificate substantially in the form of
EXHIBIT E hereto and, at the option of the Registrar and the Company, an
Opinion of Counsel reasonably satisfactory to the Registrar or the Company
to the effect that such transfer is in accordance with the Securities Act
and any applicable securities laws of the Provinces of Canada; PROVIDED
that in the case of any transfer of a Note bearing the Private Placement
Legend for a Note not bearing the Private Placement Legend, the Registrar
has received an Officers' Certificate authorizing such transfer and, at the
option of the Registrar and the Company, the proposed transferor shall
deliver an Opinion of Counsel reasonably satisfactory to the Registrar and
the Company to the effect that such transfer is in accordance with the
Securities Act; and
(ii) if the proposed transferor is a DTC Agent Member holding a
beneficial interest in the Restricted Global Note, upon receipt by the
Registrar of (x) the certificate, if any, required by paragraph (i) above
and (y) instructions given in accordance with DTC's (and Euroclear's or
CEDEL's, if applicable) and the Registrar's procedures,
whereupon (A) the Registrar shall reflect on its books and records the date and
(if the transfer does not involve a transfer of outstanding Physical Notes) a
decrease in the principal amount of the Restricted Global Note or the Regulation
S Global Note in an amount equal to the principal amount of the beneficial
interest in the Restricted Global Note to be transferred, and (B) (I) with
respect to transfers to Non-U.S. Persons, the Registrar shall reflect on its
books
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and records the date and an increase in the principal amount of the Regulation S
Global Note in an amount equal to the principal amount of the beneficial
interest in the Restricted Global Note transferred or (II) the Company shall
execute and the Trustee shall authenticate and make available for delivery one
or more Physical Notes of like tenor and amount.
(b) TRANSFERS TO QIBs. The following provisions shall apply with
respect to the registration of any proposed registration of transfer of a
Restricted Note to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer if such transfer is
being made by a proposed transferor who has checked the box provided for on
such Holder's Note stating, or has otherwise advised the Company and the
Registrar in writing, that the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed the certification
provided on such Holder's Note stating, or has otherwise advised the
Company and the Registrar in writing, that such transferee represents and
warrants that it is purchasing the Note for its own account or an account
with respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the Company as it has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon its
foregoing representations in order to claim the exemption from registration
provided by Rule 144A; and
(ii) if the proposed transferee is a DTC Agent Member, and the Notes
to be transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the Restricted Global Note, upon receipt by the
Registrar of instructions given in accordance with DTC's and the
Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Restricted
Global Note in an amount equal to the principal amount of the Physical
Notes to be transferred, and the Trustee shall cancel the Physical Notes so
transferred.
(c) PRIVATE PLACEMENT LEGEND. Upon the registration of transfer,
exchange or replacement of Notes not bearing the Private Placement Legend, the
Registrar shall deliver Notes that do not bear the Private Placement Legend.
Upon the registration of transfer, exchange or replacement of Notes bearing the
Private Placement Legend, the Registrar shall deliver only Notes that bear the
Private Placement Legend unless (i) it has received the Officers' Certificate
required by paragraph (a)(i)(x) of this Section 2.17, (ii) there is delivered to
the Registrar an Opinion of Counsel reasonably satisfactory to the Company and
the Trustee to the effect that neither such legend nor the related restrictions
on transfer are required in order to maintain compliance with the provisions of
the Securities Act or (iii) such
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Note has been sold pursuant to an effective registration statement under the
Securities Act and the Registrar has received an Officers' Certificate from the
Company to such effect.
(d) GENERAL. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such Note acknowledges and agrees to the
restrictions on transfer of such Note set forth in this Indenture and in the
Private Placement Legend and further agrees that it will transfer such Note only
as provided in this Indenture.
(e) EUROCLEAR AND CEDEL PROCEDURES APPLICABLE. The provisions of the
"Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of Cedel Bank"
and "Customer Handbook" of Cedel Bank shall be applicable to transfers of
beneficial interests in the Regulation S Global Notes that are held by DTC Agent
Members through Euroclear or CEDEL.
The Registrar shall retain for a period of three years, copies of all
letters, notices and other written communications received pursuant to Section
2.16 hereof or this Section 2.17. The Company shall have the right to inspect
and make copies of all such letters, notices or other written communications at
any reasonable time upon the giving of reasonable notice to the Registrar.
SECTION 2.18. COMPUTATION OF INTEREST.
Interest on the Notes shall be computed on the basis of a 360-day year
consisting of twelve 30-day months.
ARTICLE THREE
REDEMPTION
SECTION 3.01. ELECTION TO REDEEM; NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to Section 3.07 or 3.08
of this Indenture, at least 45 days prior to the Redemption Date (unless a
shorter notice shall be agreed to in writing by the Trustee) but not more than
65 days before the Redemption Date, the Company shall notify the Trustee in
writing of the Redemption Date, the principal amount of Notes to be redeemed and
the redemption price, and deliver to the Trustee an Officers' Certificate
stating that such redemption will comply with the conditions contained in
Section 3.07 or 3.08 of this Indenture. Notice given to the Trustee pursuant to
this Section 3.01 may not be revoked after the time that notice is given to
Holders pursuant to Section 3.03 hereof.
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SECTION 3.02. SELECTION BY TRUSTEE OF NOTES TO BE REDEEMED.
In the event that fewer than all of the Notes are to be redeemed, the
Trustee shall select the Notes to be redeemed, if the Notes are listed on a
national securities exchange, in accordance with the rules of such exchange or,
if the Notes are not so listed, either on a PRO RATA basis, by lot or in such
other manner as the Trustee shall deem fair and equitable; PROVIDED, HOWEVER,
that if a partial redemption is made with the proceeds of a Public Equity
Offering, selection of the Notes or portions thereof for redemption shall be
made by the Trustee only on a PRO RATA basis or on as nearly a PRO RATA basis as
is practicable (subject to DTC procedures), unless such method is otherwise
prohibited. The Trustee shall promptly notify the Company of the Notes selected
for redemption and, in the case of any Notes selected for partial redemption,
the principal amount thereof to be redeemed. The Trustee may select for
redemption portions of the principal of the Notes that have denominations larger
than US$1,000. Notes and portions thereof the Trustee selects shall be redeemed
in amounts of US$1,000 or whole multiples of US$1,000. For all purposes of this
Indenture unless the context otherwise requires, provisions of this Indenture
that apply to Notes called for redemption also apply to portions of Notes called
for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
At least 30 days, and no more than 60 days, before a Redemption Date,
the Company shall mail, or cause to be mailed, a notice of redemption by
first-class mail to each Holder of Notes to be redeemed at his or her last
address as the same appears on the registry books maintained by the Registrar
pursuant to Section 2.04 hereof.
The notice shall identify the Notes to be redeemed (including the
CUSIP numbers thereof, if any) and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of premium, if any, and
accrued and unpaid interest to be paid;
(3) 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 and upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion will be issued;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
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(6) that unless the Company defaults in making the redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date;
(7) the provision of this Indenture pursuant to which the Notes called
for redemption are being redeemed;
(8) the aggregate principal amount of Notes that are being redeemed;
and
(9) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed or the Notes.
At the Company's written request made at least two Business Days prior
to the date on which notice is to be given, the Trustee shall give the notice of
redemption in the Company's name and at the Company's sole expense; PROVIDED
HOWEVER, that the Company shall deliver to the Trustee at least 45 days prior to
the Redemption Date 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 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once the notice of redemption described in Section 3.03 hereof is
mailed, Notes called for redemption become due and payable on the Redemption
Date and at the redemption price, including premium, if any, plus accrued and
unpaid interest to the Redemption Date. Upon surrender to the Paying Agent, such
Notes shall be paid at the redemption price, including premium, if any, plus
accrued and unpaid interest to the Redemption Date; PROVIDED that if the
Redemption Date is after a regular record date and on or prior to the Interest
Payment Date, the accrued interest shall be payable to the Holder of the
redeemed Notes registered on the relevant record date; PROVIDED, FURTHER, that
if a Redemption Date is a Legal Holiday, payment shall be made on the next
succeeding Business Day and no interest shall accrue for the period from such
Redemption Date to such succeeding Business Day.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 A.M., New York City time, on each Redemption
Date, the Company shall deposit with the Paying Agent in immediately available
funds money sufficient to pay the redemption price of, including premium, if
any, and accrued and unpaid interest on all Notes to be redeemed on that date
other than Notes or portions thereof called for redemption on that date which
have been delivered by the Company to the Trustee for cancellation.
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On and after any Redemption Date, if money sufficient to pay the
redemption price of, including premium, if any, and accrued and unpaid interest
on Notes called for redemption shall have been deposited with the Paying Agent
in accordance with the preceding paragraph, the Notes called for redemption will
cease to accrue interest and the only right of the Holders of such Notes will be
to receive payment of the redemption price of, premium, if any, and, subject to
the first proviso in Section 3.04 hereof, accrued and unpaid interest on such
Notes to the Redemption Date. If any Note surrendered for redemption shall not
be so paid, interest will be paid, from the Redemption Date until such
redemption payment is made, on the unpaid principal of the Note and any interest
not paid on such unpaid principal, in each case, at the rate and in the manner
provided in the Notes.
SECTION 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Trustee shall
authenticate for the Holder thereof a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
The Company, at its option, may redeem the Notes, in whole at any
time, or in part from time to time on or after March 15, 2004 upon not less than
30 nor more than 60 days' notice, at the redemption prices (expressed as
percentages of principal amount thereof), set forth below, together, in each
case, with accrued and unpaid interest to the Redemption Date, if redeemed
during the twelve month period beginning on March 15 of each year listed below:
Year Redemption Price
------ --------------------
2004............................................. 105.000%
2005............................................. 103.333%
2006............................................. 101.667%
2007 and thereafter.............................. 100.000%
Notwithstanding the foregoing, the Company may redeem in the aggregate
up to 35% of the original principal amount of Notes at any time and from time to
time prior to March 15, 2002 at a redemption price equal to 110% of the
aggregate principal amount so redeemed, plus accrued and unpaid interest to the
Redemption Date out of the net cash proceeds of one or more Public Equity
Offering; PROVIDED that at least 65% of the principal amount of Notes originally
issued remains outstanding immediately after the occurrence of any such
redemption and that any such redemption occurs within 90 days following the
closing of any such Public Equity Offering.
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SECTION 3.08. TAX REDEMPTION.
The Notes are redeemable, in whole but not in part, at the option of
the Company at any time, upon not less than 30 nor more than 60 days' prior
written notice, mailed by first class mail to each Holder at its last address
appearing in the register maintained by the Registrar of Notes, at 100% of the
principal amount thereof, plus accrued and unpaid interest thereon to the
Redemption Date, if the Company or any Guarantor is or would become obligated to
pay, on the next date on which any amount would be payable with respect to the
Notes, any Additional Amounts as a result of a change in, or amendment to, the
laws (or any regulations promulgated thereunder) of any Taxing Authority, or any
changes in, or amendment to, any official position regarding the application or
interpretation of such laws or regulations, which change or amendment is
announced or becomes effective on or after the Issue Date; PROVIDED that the
Company or such Guarantor determines, in its business judgment, that the
obligation to pay such Additional Amounts cannot be avoided by the use of
reasonable measures available to the Company or such Guarantor (not including
substitution of the obligor under the Notes).
SECTION 3.09. PURCHASE OF NOTES.
The Company or any of its Subsidiaries shall have the right at any
time and from time to time to purchase Notes in the open market (which shall
include purchase from or through an investment dealer, investment bank or firm
holding membership in a stock exchange or the National Association of Securities
Dealers, Inc.) or by tender or by private contract or otherwise, at any price,
provided that the Company complies with any securities laws or regulations
applicable to any such purchase including, but not limited to Rule 14e-1 under
the Exchange Act.
ARTICLE FOUR
COVENANTS
SECTION 4.01. PAYMENT OF NOTES.
The Company shall pay the principal of and interest (including all
Additional Interest) on the Notes on the dates and in the manner provided in the
Notes and this Indenture. An installment of principal or interest shall be
considered paid on the date it is due if the Trustee or Paying Agent (if other
than the Company, a Subsidiary of the Company or any Guarantor) holds on that
date money designated for and sufficient to pay such installment.
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The Company shall pay interest on overdue principal (including
post-petition interest in a proceeding under any Bankruptcy Law), and overdue
installments of interest, to the extent lawful, at the rate specified in the
Notes.
SECTION 4.02. REPORTS TO HOLDERS.
Whether or not required by the rules and regulations of the
Commission, so long as the Notes are outstanding, the Company shall furnish to
the Trustee and, upon request to the Holders all annual and quarterly financial
information that would be required to be contained in a filing with the
Commission on Forms 20-F, 40-F and 6-K, as applicable, if the Company were
required to file such Forms, including a "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and, with respect to the
annual financial information, a report thereon by the Company's chartered
accountants; PROVIDED, that (x) such quarterly financial information shall be
furnished within 60 days following the end of each fiscal quarter of the Company
and (y) such annual financial information shall be furnished within 180 days
following the end of the fiscal year of the Company. 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). In addition,
the Company shall furnish to the Holders and to prospective investors, upon the
requests of such Holders, any information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely
transferable under the Securities Act. The Company, the Guarantors and their
respective subsidiaries will also comply with the other provisions of TIA
-Section- 314(a).
SECTION 4.03. WAIVER OF STAY, EXTENSION OR USURY LAWS.
The Company and any Guarantors covenant (to the extent that they may
lawfully do so) that they shall not at any time insist upon, or plead (as a
defense or otherwise) or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury law or other law which
would prohibit or forgive the Company and any Guarantors from paying all or any
portion of the principal of, premium, if any, and/or interest on the Notes as
contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture; and (to the
extent that they may lawfully do so) the Company and any Guarantors hereby
expressly waive all benefit or advantage of any such law, and covenant that they
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year and on or before 60 days after the end of the first,
second and third quarters of
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each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during such fiscal year or fiscal
quarter, as the case may be, has been made under the supervision of the signing
Officers with a view to determining whether the Company and any Guarantors have
kept, observed, performed and fulfilled their 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 and any Guarantors have kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and are not in default in the performance or observance of any of the
terms, provisions and conditions hereof (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 they are taking or propose 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, if any, on the Notes is prohibited or if such event
has occurred, a description of the event and what action the Company and any
Guarantors are taking or propose to take with respect thereto.
(b) The Company and any Guarantors 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 and any Guarantors
are taking or propose to take with respect thereto.
(c) The Company's fiscal year currently ends on December 31. The
Company will promptly provide written notice to the Trustee of any change in its
fiscal year.
SECTION 4.05. TAXES.
The Company and any Guarantors shall, and shall cause each of their
Subsidiaries to, pay prior to delinquency all material taxes, assessments, and
governmental levies except as contested in good faith and by appropriate
proceedings.
SECTION 4.06. LIMITATION ON ADDITIONAL INDEBTEDNESS.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, incur (as defined) any
Indebtedness (including, without limitation, any Acquired Indebtedness);
PROVIDED that if no Default or Event of Default shall have occurred and be
continuing at the time or as a consequence of the incurrence of such
Indebtedness, the Company or any Restricted Subsidiary may incur Indebtedness
(including any Acquired Indebtedness) if the Company's Consolidated Fixed Charge
Coverage Ratio is at least 2.0 to 1.
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Notwithstanding the foregoing, the Company and its Restricted
Subsidiaries may incur Permitted Indebtedness.
For purposes of determining compliance with this Section 4.06, in the
event that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness described in clauses (i) through (xii) of
the definition thereof or is entitled to be incurred pursuant to the first
paragraph of this Section 4.06, the Company shall classify such Indebtedness in
its sole discretion, and such item of Indebtedness will be treated as having
been incurred pursuant to only one of such clauses or pursuant to the first
paragraph of this definition. Accrual of interest, the accretion of accreted
value and the payment of interest in the form of additional Indebtedness, in
each case in accordance with the terms of the underlying Indebtedness at its
time of incurrence by the Company or a Restricted Subsidiary, as the case may
be, will not be deemed to be an incurrence of Indebtedness for purposes of this
Section 4.06; PROVIDED that the underlying Indebtedness is incurred in
accordance with the terms of this Indenture. Any increase in the Canadian dollar
equivalent of outstanding Indebtedness of the Company or any of its Restricted
Subsidiaries denominated in a currency other than Canadian dollars resulting
from fluctuations in the exchange values of currencies shall not be deemed to be
an incurrence of Indebtedness for purposes of this Section 4.06 or the
definition of Permitted Indebtedness; PROVIDED that the amount of Indebtedness
of the Company outstanding at any time shall be the Canadian dollar equivalent
of all such Indebtedness of the Company outstanding at such time.
SECTION 4.07. LIMITATION ON RESTRICTED PAYMENTS.
The Company shall not make, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, make, any Restricted
Payment, unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such Restricted
Payment;
(b) immediately after giving pro forma effect to such Restricted
Payment, the Company could incur US$1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to Section 4.06 hereof; and
(c) immediately after giving effect to such Restricted Payment, the
aggregate amount of all Restricted Payments declared or made after the Issue
Date does not exceed the sum (without duplication) of (1) 50% of the Company's
cumulative Consolidated Net Income (or if cumulative Consolidated Net Income
shall be a loss, minus 100% of such loss) for the period beginning on the first
date of the fiscal quarter in which the Issue Date shall occur and ending on the
last day of the fiscal quarter immediately preceding the date of such proposed
Restricted Payment (treating such period as a single accounting period); (2)
100% of the aggregate net cash proceeds received by the Company from the
issuance or sale after the Issue
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Date (other than to a Restricted Subsidiary) of, or Capital Contributions with
respect to, (A) Capital Stock (other than Disqualified Capital Stock) of the
Company or (B) any Indebtedness or other securities of the Company that are
convertible into or exercisable or exchangeable for Capital Stock (other than
Disqualified Capital Stock) of the Company which have been so converted,
exercised or exchanged, as the case may be; (3) without duplication of any
amounts included in clause (1) above, so long as the Designation thereof was
treated as a Restricted Payment made after the Issue Date, with respect to any
Unrestricted Subsidiary that has been redesignated as a Restricted Subsidiary
after the Issue Date in accordance with the definition of "Restricted
Subsidiary," the Company's proportionate interest in an amount equal to the Fair
Market Value of the Company's interest in such Subsidiary; PROVIDED that such
amount shall not in any case exceed the Designation Amount with respect to such
Restricted Subsidiary at the time of its Designation; (4) in the case of the
disposition or repayment of any Investment constituting a Restricted Payment
made after the Issue Date, to the extent not otherwise included in the Company's
Consolidated Net Income, the amount of cash proceeds (or Cash Equivalents)
received by the Company or any Restricted Subsidiary with respect to such
Investment, net of any costs of disposition and taxes paid or payable in
connection with such disposition or repayment; (5), to the extent not otherwise
included in the Company's Consolidated Net Income, the amount of the cash
proceeds (or Cash Equivalents) received by the Company or any Restricted
Subsidiary upon the sale of any Unrestricted Subsidiary after the Issue Date,
net of any costs of disposition and taxes paid or payable in connection with
such sale; and (6) $15,000,000. For purposes of determining the amount expended
for Restricted Payments under this clause (c), property other than cash shall be
valued at its Fair Market Value.
The provisions of this Section 4.07 shall not prevent (i) the payment
of any dividend or distribution within 60 days after the date of declaration
thereof, if at such date of declaration such payment would comply with the
provisions of this Indenture; (ii) the repurchase, redemption or other
acquisition or retirement of any shares of Capital Stock of the Company or
Indebtedness of the Company or any Guarantor subordinated to the Notes or such
Guarantor's Guarantee, as the case may be, by conversion into, or by or in
exchange for, shares of Capital Stock of the Company (other than Disqualified
Capital Stock), or out of the net cash proceeds of the substantially concurrent
sale (other than to a Restricted Subsidiary of the Company) of other shares of
Capital Stock of the Company (other than Disqualified Capital Stock); PROVIDED
that any such net cash proceeds are excluded from clause(c)(2) of the
immediately preceding paragraph for the purposes of this calculation (and were
not included therein at any time); (iii) the redemption, repayment or retirement
of Indebtedness of the Company or any Guarantor subordinated to the Notes or
such Guarantor's Guarantee, as the case may be, in exchange for, by conversion
into, or out of the net cash proceeds of, (x) a substantially concurrent sale or
incurrence of Indebtedness of the Company or such Guarantor, as the case may be
(other than any Indebtedness owed to a Restricted Subsidiary), that is
contractually subordinated in right of payment to the Notes or such Guarantor's
Guarantee, as
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the case may be, to at least the same extent as the Indebtedness being redeemed,
repaid or retired or (y) a substantially concurrent sale (other than to a
Restricted Subsidiary of the Company) of shares of Capital Stock of the Company;
PROVIDED that any such net cash proceeds are excluded from clause (c)(2) of the
immediately preceding paragraph (and were not included therein at any time);
(iv) the retirement of any shares of Disqualified Capital Stock of the Company
by conversion into, or by exchange for, other shares of Disqualified Capital
Stock of the Company, or out of the net cash proceeds of the substantially
concurrent sale (other than to a Restricted Subsidiary of the Company) of other
shares of Disqualified Capital Stock of the Company; PROVIDED that any such net
cash proceeds are excluded from clause (c)(2) of the immediately preceding
paragraph (and were not included therein at any time); (v) the purchase,
redemption or other acquisition for value of shares of Capital Stock of the
Company (other than Disqualified Capital Stock) held by employees or directors
(or their estates or beneficiaries under their estates) of the Company upon the
death, retirement or termination of employment or directorship of such employees
or directors pursuant to the terms of an employee benefit plan or other
agreement approved by the Board of Directors of the Company; PROVIDED that the
aggregate cash consideration paid, or distributions made, pursuant to this
clause (v) do not exceed $2,000,000 million in the aggregate subsequent to the
Issue Date; (vi) Permitted Restructuring Distributions and (vii) the Holdings
Loan Distribution. In calculating the aggregate amount of Restricted Payments
made subsequent to the Issue Date for purposes of clause (c) of the immediately
preceding paragraph, amounts expended pursuant to clauses (i) (but only if the
declaration thereof has not been counted in a prior period) and (v) shall be
included in such calculation and clauses (ii), (iii), (iv), (vi) and (vii) shall
not be included in such calculation.
Not later than 20 days after the date of making any Restricted
Payment, the Company shall deliver to the Trustee an Officers' Certificate
stating that such Restricted Payment is permitted and setting forth the basis
upon which the calculations required by the preceding paragraph of this Section
4.07 were computed, which calculations may be based upon the Company's latest
available financial statements, and that no Default or Event of Default has
occurred and is continuing and no Default or Event of Default will occur
immediately after giving effect to any such Restricted Payment.
SECTION 4.08. LIMITATION ON LIENS.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries, directly or indirectly, to, create, incur or otherwise
cause or suffer to exist or become effective any Liens (other than Permitted
Liens) upon or with respect to any property or assets of the Company or any of
its Restricted Subsidiaries, unless (i) if such Lien secures Indebtedness which
is ranked equally and ratably with the Notes or any Guarantee, then the Notes or
such Guarantee, as the case may be, are secured on an equal and ratable basis
with the obligations so secured until such time as such obligations are no
longer secured by a Lien
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or (ii) if such Lien secures Indebtedness which is subordinated to the Notes or
any Guarantee, then the Notes or such Guarantee, as the case may be, are secured
and the Lien securing such other Indebtedness shall be subordinated to the Lien
granted to the Holders or such Guarantee, as the case may be, at least to the
same extent as such Indebtedness is subordinated to the Notes or such Guarantee,
as the case may be.
SECTION 4.09. LIMITATION ON TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate (each an "AFFILIATE TRANSACTION") or extend, renew,
waive or otherwise modify the terms of any Affiliate Transaction entered into
prior to the Issue Date unless (i) such Affiliate Transaction is between or
among the Company and its Restricted Subsidiaries or between or among Restricted
Subsidiaries; or (ii) the terms of such Affiliate Transaction are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
the terms which could reasonably be obtained by the Company or such Restricted
Subsidiary, as the case may be, at such time in a comparable transaction made on
an arm's-length basis between unaffiliated parties. In any Affiliate Transaction
(or any series of related Affiliate Transactions) involving an amount or having
a Fair Market Value in excess of $3,000,000 which is not permitted under clause
(i) of the immediately preceding sentence, the Company shall obtain a resolution
of the disinterested members of the Board of Directors of the Company certifying
that they have approved such Affiliate Transaction and determined that such
Affiliate Transaction complies with clause (ii) of the immediately preceding
sentence. In addition, in any Affiliate Transaction (or any series of related
Affiliate Transactions) involving an amount or having a Fair Market Value in
excess of $25,000,000 which is not permitted under clause (i) of the second
preceding sentence, the Company must obtain a written opinion from an
Independent Financial Advisor that such transaction or transactions are fair to
the Company or such Restricted Subsidiary, as the case may be, from a financial
point of view.
The foregoing provisions will not apply to (i) any Restricted Payment
made in compliance with Section 4.07 hereof, (ii) any payment of customary and
reasonable fees to directors of the Company, (iii) any employment agreement or
compensation arrangement in effect on the Issue Date or entered into thereafter
by the Company or any of its Restricted Subsidiaries in the ordinary course of
business and consistent with the past practice of the Company and its Restricted
Subsidiaries, (iv) transactions in the ordinary course of business pursuant to
any pension, share or partnership unit option, profit sharing, partnership unit
or share appreciation rights or other employee benefit plan or agreement
(including insurance, indemnification and reimbursement plans and arrangements
for directors, officers and employees), (v) loans to employees not to exceed
$5,000,000 in aggregate amount at any one
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time outstanding, or (iv) issuances of Capital Stock (other than Disqualified
Capital Stock) of the Company.
SECTION 4.10. LIMITATION ON ASSET SALES.
(a) The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless (i) the Company or
such applicable Restricted Subsidiary, as the case may be, receives
consideration at the time of such sale or other disposition at least equal to
the Fair Market Value of the assets sold or otherwise disposed of; (ii) not less
than 80% of the consideration received by the Company or such applicable
Restricted Subsidiary, as the case may be, is in the form of (a) cash or Cash
Equivalents or (b) Replacement Assets, and in each case set forth in clauses (a)
and (b), is received at the time of such sale or other disposition; PROVIDED
that the amount of (x) any Indebtedness (other than subordinated Indebtedness)
of the Company or any such applicable Restricted Subsidiary that is actually
assumed by the transferee in such Asset Sale and from which the Company and its
Restricted Subsidiaries are fully and unconditionally released and (y) any
securities received by the Company or any such applicable Restricted Subsidiary
which are converted into cash or Cash Equivalents within five Business Days of
such Asset Sale (to the extent of the cash or Cash Equivalents received), will
be deemed to be cash for purposes of this clause (ii); and (iii) the Asset Sale
Proceeds received by the Company or such Restricted Subsidiary, as the case may
be, are applied, at the option of the Company or such Restricted Subsidiary, (a)
to prepay, repay or purchase indebtedness under the New Credit Facilities or any
other secured Indebtedness of the Company or such Restricted Subsidiary; or (b)
to an investment in properties and assets that are used or useful in the
business of the Company or its Restricted Subsidiaries or in businesses
reasonably similar to or ancillary to the business of the Company or its
Restricted Subsidiaries as conducted at the time of such Asset Sale; PROVIDED
that (1) such investment occurs or (2) the Company or any such Restricted
Subsidiary enters into contractual commitments to so apply such Asset Sale
Proceeds, subject only to customary conditions (other than the obtaining of
financing), in each case, within 365 days following the receipt of such Asset
Sale Proceeds; or (c) if on such 365th day, the Available Asset Sale Proceeds
exceed $15,000,000, the Company shall apply an amount equal to the Available
Asset Sale Proceeds to an offer to repurchase the Notes (and, at its option, to
an offer to repurchase other equal and ratable Indebtedness; PROVIDED that the
stated maturity date of such Indebtedness is no later than the stated maturity
date of the Notes), at a purchase price in cash equal to 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the purchase date
(an "EXCESS PROCEEDS OFFER"). If an Excess Proceeds Offer is not fully
subscribed, the Company may retain and use for general corporate purposes the
portion (any such portion, a "DEFICIENCY") of the Available Asset Sale Proceeds
not required to repurchase Notes. Upon completion of any Excess Proceeds Offer,
the amount of Available Asset Sale Proceeds shall be reset to zero; PROVIDED
that the amount of the 25% Available Asset Sale Proceeds (as defined below)
shall constitute Available Asset
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Sale Proceeds for purposes of the first Excess Proceeds Offer that is made after
the fifth anniversary of the Issue Date (the "FIFTH ANNIVERSARY").
(b) Notwithstanding the foregoing, in no event shall the Company use
Available Asset Sale Proceeds to purchase more than 25% of the original
aggregate principal amount of the Notes on or prior to the Fifth Anniversary. If
the aggregate Available Asset Sale Proceeds (disregarding any resetting to zero
as described in paragraph (a) above) resulting from Asset Sales occurring on or
prior to the Fifth Anniversary, less any Deficiencies resulting from any Excess
Proceeds Offers made by the Company on or prior to such date, exceed 25% of the
original aggregate principal amount of the Notes (such excess being the "25%
AVAILABLE ASSET SALE PROCEEDS"), then the Company shall make an Excess Proceeds
Offer in accordance with the foregoing provisions (i) promptly after the Fifth
Anniversary, in the event the amount of the 25% Available Asset Sale Proceeds
exceeds $15,000,000 or (ii) at such time as the amount of the 25% Available
Asset Sale Proceeds together with Available Asset Sale Proceeds realized after
the Fifth Anniversary exceeds $15,000,000, in the event the amount of the 25%
Available Asset Sale Proceeds is less than $15,000,000.
(c) If the Company is required to make an Excess Proceeds Offer, the
Company shall (i) notify the Trustee thereof at least five Business Days prior
to the commencement of the Excess Proceeds Offer and (ii) send by first-class
mail, postage prepaid, within 30 days following the date specified in clause
(iii)(c) of paragraph (a) above, a notice to the Trustee and to each Holder, at
the address appearing in the register maintained by the Registrar, stating the
information set forth below. The Excess Proceeds Offer shall remain open for a
period of 20 Business Days following its commencement (the "OFFER PERIOD"). The
notice, which shall govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Excess Proceeds Offer is being made pursuant to this
Section 4.10 and the length of time the Excess Proceeds Offer will remain
open;
(2) the purchase price and the purchase date (which shall be a
Business Day no earlier than 30 days nor later than 60 days from the date
such notice is mailed);
(3) that any Note not tendered or accepted for payment will continue
to accrue interest;
(4) that, unless the Company defaults in a payment pursuant to the
Excess Proceeds Offer, any Notes accepted for payment pursuant to the
Excess Proceeds Offer shall cease to accrue interest after the expiration
of the Offer Period;
(5) that Holders electing to have a Note purchased pursuant to any
Excess Proceeds Offer will be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, to the Paying
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Agent at the address specified in the notice prior to the close of business
on the Business Day preceding the purchase date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the expiration of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Note the Holder delivered for
purchase and a statement that such Holder is withdrawing his election to
have such Note purchased;
(7) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Available Asset Sale Proceeds, the Company or the
Trustee shall select the Notes to be purchased on a PRO RATA basis (with
such adjustments as may be deemed appropriate by the Company so that only
Notes in denominations of US$1,000, or integral multiples thereof, shall be
purchased);
(8) 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; PROVIDED that each Note purchased and each such new
Note issued shall be in an original principal amount in denominations of
US$1,000 and integral multiples thereof; and
(9) the calculations used in determining the amount of Available Asset
Sale Proceeds to be applied to the purchase of such Notes.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and other securities laws and regulations thereunder to the extent
such laws and regulations are applicable in connection with the repurchase of
Notes pursuant to an Excess Proceeds Offer. To the extent that the provisions of
any securities laws or regulations conflict with this Section 4.10, the Company
shall comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations under this Section 4.10 by virtue
thereof.
SECTION 4.11. LIMITATION ON CAPITAL STOCK OF RESTRICTED SUBSIDIARIES.
The Company shall not, other than in the case of Powerco, (i) sell,
pledge, hypothecate (other than Permitted Liens) or otherwise convey or dispose
of any Capital Stock of a Restricted Subsidiary of the Company or (ii) permit
any of its Restricted Subsidiaries to issue any Capital Stock, other than to the
Company or a Wholly Owned Restricted Subsidiary of the Company. The foregoing
restrictions shall not apply to an Asset Sale consisting of all of the Capital
Stock of a Restricted Subsidiary owned by the Company and its Restricted
Subsidiaries made in compliance with Section 4.10 hereof.
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SECTION 4.12. LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS
AFFECTING RESTRICTED
SUBSIDIARIES.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary of the Company to (a)(i) pay dividends or
make any other distributions to the Company or any Restricted Subsidiary of the
Company (A) on its Capital Stock or (B) with respect to any other interest or
participation in, or measured by, its profits or (ii) repay any Indebtedness or
any other obligation owed to the Company or any Restricted Subsidiary of the
Company, (b) make loans or advances or capital contributions to the Company or
any of its Restricted Subsidiaries or (c) transfer any of its properties or
assets to the Company or any of its Restricted Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of (i) encumbrances or
restrictions existing on the Issue Date to the extent and in the manner such
encumbrances and restrictions are in effect on the Issue Date, (ii) encumbrances
or restrictions in the New Credit Facilities, (iii) this Indenture, the Notes
and any Guarantees, (iv) applicable law, (v) any instrument governing Acquired
Indebtedness as in effect at the time of such acquisition, which encumbrance or
restriction is not applicable to any Person, or the properties or assets of any
Person, other than the Person or the property or assets of the Person (including
any Subsidiary of the Person), so acquired, (vi) customary non-assignment
provisions in leases or other agreements entered in the ordinary course of
business and consistent with past practices, (vii) Refinancing Indebtedness;
PROVIDED that such restrictions are not on the whole materially more restrictive
than those contained in the agreements governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded, (viii)
restrictions in security agreements or mortgages securing Indebtedness of the
Company or a Restricted Subsidiary only to the extent such restrictions restrict
the transfer of the property subject to such security agreements and mortgages,
(ix) restrictions with respect to a Restricted Subsidiary of the Company
pursuant to an agreement that has been entered into for the sale or disposition
of all or substantially all of the Capital Stock or assets of such Restricted
Subsidiary to be consummated in accordance with the terms of this Indenture
solely in respect of the Capital Stock or assets to be sold or disposed of, (x)
purchase money obligations for property acquired in the ordinary course of
business that impose restrictions of the nature described in clause (viii) above
on the property so acquired, (xi) any agreement for the sale of assets
(including any Asset Sale) that restricts transfers of such assets pending their
sale, (xii) secured Indebtedness otherwise permitted to be incurred pursuant to
the provisions of the covenant described above under Section 4.08 that limits
the right of the debtor to dispose of the assets securing such Indebtedness,
(xiii) any encumbrance or restriction contained in Purchase Money Indebtedness
to the extent that such encumbrance or restriction (x) only restricts the
transfer of the Property financed with such Purchase Money Indebtedness and (y)
solely relates to the Property financed with such Purchase Money Indebtedness,
and
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(xiv) restrictions on cash or other deposits imposed by customers under
contracts entered into in the ordinary course of business.
SECTION 4.13. LIMITATION ON SUBSIDIARIES.
If the Company or any of its Restricted Subsidiaries transfers or
causes to be transferred any Property to, or organizes, acquires, invests in or
otherwise holds an Investment in, any Restricted Subsidiary that is not a
Guarantor having total consolidated assets with a book value in excess of
$500,000, then such transferee or acquired or other Restricted Subsidiary shall
(a) execute and deliver to the Trustee a supplemental indenture in form
reasonably satisfactory to the Trustee pursuant to which such Restricted
Subsidiary shall unconditionally guarantee all of the Company's obligations
under the Notes and this Indenture in the form set forth in EXHIBIT F hereto,
(b) deliver to the Trustee an Opinion of Counsel that such supplemental
indenture has been duly authorized, executed and delivered by such Restricted
Subsidiary and constitutes a legal, valid, binding and enforceable obligation of
such Restricted Subsidiary and (c) execute such other documents and take such
other actions as the Trustee may reasonably require in order to evidence the
Guarantee of such Restricted Subsidiary and the agreement of such Restricted
Subsidiary to be bound by the Guarantee. Thereafter, such Restricted Subsidiary
shall be a Guarantor for all purposes of this Indenture.
SECTION 4.14. LEGAL EXISTENCE.
Subject to Article Five hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
legal existence, and the corporate, partnership or other existence of each
Restricted Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of each Restricted
Subsidiary and the rights (charter and statutory), licenses and franchises of
the Company and its Restricted Subsidiaries; PROVIDED that the Company shall not
be required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of its Restricted Subsidiaries if the
Board of Directors of the Company shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries, taken as a whole, and that the loss thereof is not
adverse in any material respect to the Holders.
SECTION 4.15. CHANGE OF CONTROL OFFER.
(a) Upon the occurrence of a Change of Control Triggering Event, the
Company shall be obligated to make an offer to purchase (the "CHANGE OF CONTROL
OFFER") all outstanding Notes at a purchase price (the "CHANGE OF CONTROL
PURCHASE PRICE") equal to 101% of the principal amount thereof, plus accrued and
unpaid interest thereon to the Change of Control Payment Date in accordance with
this Section 4.15.
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(b) Within 30 days of the occurrence of a Change of Control Triggering
Event, the Company shall (i) cause a notice of the Change of Control Offer to be
sent at least once to the Dow Xxxxx News Service or similar business news
service in the United States and (ii) send by first-class mail, postage prepaid,
to the Trustee and to each Holder, at the address appearing in the register
maintained by the Registrar of the Notes, a notice stating:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.15 and that all Notes tendered will be accepted for payment;
(2) the Change of Control Purchase Price and the purchase date (which
shall be a Business Day no earlier than 30 days nor later than 60 days from
the date such notice is mailed (the "CHANGE OF CONTROL PAYMENT DATE"));
(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 Purchase Price, any Notes accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(5) that Holders accepting the offer to have a Note purchased pursuant
to any Change of Control Offer will be required to surrender the Note, with
the form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, to the Paying Agent at the address specified in the
notice prior to the close of business on the Business Day preceding the
Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day preceding the Change of Control Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Notes the Holder delivered for
purchase, and a statement that such Holder is withdrawing his election to
have such Note purchased;
(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; PROVIDED that each Note purchased and each such new
Note issued shall be in an original principal amount in denominations of
US$1,000 and integral multiples thereof;
(8) any other procedures that a Holder must follow to accept a Change
of Control Offer or effect withdrawal of such acceptance; and
(9) the name and address of the Paying Agent.
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On the Change of Control Payment Date, the Company shall, to the
extent lawful, (i) accept for payment Notes or portions thereof properly
tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent money sufficient to pay the purchase price of all Notes or portions
thereof so tendered and (iii) deliver or cause to be delivered to the Trustee
Notes so accepted together with an Officers' Certificate stating the Notes or
portions thereof tendered to the Company. The Paying Agent shall promptly mail
to each Holder of Notes so accepted payment in an amount equal to the purchase
price for such Notes, and the Company shall execute and issue, and the Trustee
shall promptly authenticate and mail to such Holder, a new Note equal in
principal amount to any unpurchased portion of the Notes surrendered; PROVIDED
that each such new Note shall be issued in an original principal amount in
denominations of US$1,000 and integral multiples thereof.
(c) (A) If the Company or any Restricted Subsidiary thereof has issued
any outstanding (i) Indebtedness that is subordinated in right of payment to the
Notes or (ii) Preferred Stock, and the Company or such Restricted Subsidiary is
required to make a Change of Control Offer or to make a distribution with
respect to such subordinated Indebtedness or Preferred Stock in the event of a
change of control, the Company shall not consummate any such offer or
distribution with respect to such subordinated Indebtedness or Preferred Stock
until such time as the Company shall have paid the Change of Control Purchase
Price in full to the Holders of Notes that have accepted the Company's Change of
Control Offer and shall otherwise have consummated the Change of Control Offer
made to Holders of the Notes and (B) the Company shall not issue Indebtedness
that is subordinated in right of payment to the Notes or Preferred Stock with
change of control provisions requiring the payment of such Indebtedness or
Preferred Stock prior to the payment of the Notes in the event of a Change of
Control Triggering Event under this Indenture.
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 Notes pursuant to a Change of Control Offer. To the extent that
the provisions of any securities laws or regulations conflict with this Section
4.15, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.15 by virtue thereof.
SECTION 4.16. PAYMENT OF ADDITIONAL AMOUNTS.
All payments made by the Company under or with respect to the Notes,
or any Guarantor in respect of its Guarantee will be made free and clear of and
without withholding or deduction for or on account of any present or future
Taxes, unless the Company or such Guarantor is required to withhold or deduct
Taxes by law or by the interpretation or administration thereof. If the Company
or any Guarantor is required to withhold or deduct any
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amount for or on account of Taxes from any payment made under or with respect to
the Notes or the Guarantees, the Company or such Guarantor will pay such
additional amounts ("ADDITIONAL AMOUNTS") as may be necessary so that the net
amount received by each Holder (including Additional Amounts) after such
withholding or deduction will not be less than the amount the Holder would have
received if such Taxes had not been withheld or deducted; PROVIDED that no
Additional Amounts will be payable with respect to a payment made to a Holder
(an "EXCLUDED HOLDER") (i) with which the Company or such Guarantor does not
deal at arm's length (within the meaning of the Income Tax Act (Canada)) at the
time of making such payment or (ii) which is subject to Taxes by reason of its
being connected with Canada or any province or territory thereof otherwise than
by the mere acquisition, holding or disposition of the Notes or the receipt of
payments thereunder. The Company and any Guarantors will also (i) make such
withholding or deduction and (ii) remit the full amount deducted or withheld to
the relevant authority in accordance with applicable law. The Company and any
Guarantors will furnish to the Holders (other than Excluded Holders) of Notes
that are outstanding on the date of the withholding or deduction, within 30 days
after the date of the payment of any Taxes due pursuant to applicable law,
certified copies of tax receipts evidencing such payment by the Company or such
Guarantor.
The Company and any Guarantors will, upon written request of any
Holder (other than an Excluded Holder), reimburse each such Holder, for the
amount of (i) any such Taxes so levied or imposed and paid by such Holder as a
result of payments made under or with respect to the Notes or the Guarantees;
and (ii) any Taxes so levied or imposed with respect to any reimbursement under
the foregoing clause (i) so that the net amount received by such Holder after
such reimbursement will not be less than the net amount the Holder would have
received if Taxes on such reimbursement had not been imposed, but excluding any
such Taxes on such Holder's net income generally.
At least 30 days prior to each date on which any payment under or with
respect to the Notes is due and payable, if the Company or any Guarantor will be
obligated to pay Additional Amounts with respect to such payment, the Company or
such Guarantor will deliver to the Trustee an Officers' Certificate stating the
fact that such Additional Amounts will be payable and specifying the amounts so
payable and will set forth such other information necessary to enable the
Trustee to pay such Additional Amounts to Holders on the payment date. Whenever
in this Indenture there is mentioned, in any context, principal, premium, if
any, interest or any other amount payable under or with respect to any Note,
such mention shall be deemed to include the payment of Additional Amounts to the
extent that, in such context, Additional Amounts are, were or would be payable
in respect thereof.
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ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. LIMITATION ON CONSOLIDATION, AMALGAMATION, MERGER AND
SALE OF ASSETS.
(a) The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, consolidate with, amalgamate with, merge with or
into, or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of the assets of the Company (determined on a consolidated
basis for the Company and its Restricted Subsidiaries) as an entirety or
substantially as an entirety in one transaction or a series of related
transactions, to any Person unless:
(i) the Company or such Restricted Subsidiary, as the case may be,
shall be the continuing Person, or the Person (if other than the Company or
such Restricted Subsidiary) formed by such consolidation or amalgamation or
into which the Company or such Restricted Subsidiary, as the case may be,
is merged or assigned, transferred, leased, conveyed or otherwise disposed
of shall be a corporation organized and existing under the laws of the
United States or any State thereof or the District of Columbia or the laws
of Canada or any province or territory thereof and shall expressly assume,
by a supplemental indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all of the obligations of the Company or such
Restricted Subsidiary, as the case may be, under this Indenture, the Notes
and any Guarantee, as the case may be, and the obligations thereunder shall
remain in full force and effect;
(ii) immediately before and immediately after giving effect to such
transaction (including, without limitation, giving effect to any
Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred and any Lien granted in connection with or in respect of the
transaction), no Default or Event of Default shall have occurred and be
continuing; and
(iii) immediately after giving effect to such transaction on a PRO
FORMA basis the Company or such Person (A) shall have a Consolidated Net
Worth equal to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction and (B) could incur at least US$1.00
of additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.06 hereof; PROVIDED that the Company may effect the
Reorganization Merger and the Company or a Guarantor may merge into or sell
all or substantially all of its assets to the Company or another Guarantor,
as the case may be, without complying with this clause (iii).
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(b) In connection with any consolidation, merger or transfer of assets
contemplated by this provision, prior to the consummation of such transaction
the Company shall deliver, or cause to be delivered, to the Trustee, in form and
substance reasonably satisfactory to the Trustee, an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger or transfer
and the supplemental indenture in respect thereto comply with this provision and
that all conditions precedent herein provided for relating to such transaction
or transactions have been complied with.
For purposes of clauses (a) and (b) of this Section 5.01, the transfer
(by lease, assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company, the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
SECTION 5.02. SUCCESSOR PERSON SUBSTITUTED.
Upon any consolidation, amalgamation or merger, or any transfer of all
or substantially all of the assets of the Company or any Restricted Subsidiary
in accordance with Section 5.01 hereof, the successor corporation formed by such
consolidation or amalgamation 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 or such Restricted Subsidiary under this
Indenture and the Notes with the same effect as if such successor corporation
had been named as the Company or such Restricted Subsidiary herein, and
thereafter the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Notes.
ARTICLE SIX
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
The following events are "Events of Default":
(1) default in the payment of any principal of, or premium, if any, on
the Notes when due (whether at maturity, upon redemption or otherwise);
(2) default in the payment of any interest on any Note when due, which
default continues for 30 days or more;
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(3) default by the Company or any Restricted Subsidiary in the
observance or performance of any other covenant in the Notes or this
Indenture for 30 days after written notice specifying the default and
demanding that such default be remedied from the Trustee or the Holders of
not less than 25% in aggregate principal amount of the Notes then
outstanding (except in the case of a default with respect to Section 4.10,
4.15 or 5.01 hereof, which shall constitute an Event of Default with such
notice requirement but without such passage of time requirement);
(4) failure to pay at final maturity (giving effect to any applicable
grace periods and any extensions thereof) the principal amount of any
Indebtedness of the Company or any Restricted Subsidiary of the Company, or
the acceleration of the final stated maturity of such Indebtedness if, in
either case, the aggregate principal amount of such Indebtedness together
with the principal amount of any other Indebtedness not paid at final
maturity or which has been accelerated, aggregates $10,000,000 or more at
any time and such Indebtedness has not been discharged in full, or such
acceleration has not been rescinded or annulled within 30 days after such
final maturity or acceleration;
(5) any final judgment or judgments which can no longer be appealed
for the payment of money in excess of $10,000,000 (in excess of amounts
covered by insurance and as to which the insurer has acknowledged coverage)
shall be rendered against the Company or any Restricted Subsidiary thereof,
and shall not be discharged for any period of 60 consecutive days during
which a stay of enforcement shall not be in effect;
(6) the Company or any Restricted Subsidiary with assets in excess of
$1,000,000 pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all
or substantially all of its property,
(D) makes a general assignment for the benefit of its creditors,
or
(E) generally is not paying its debts as they become due;
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(7) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against either of the Company or any Restricted
Subsidiary with assets in excess of $1,000,000 in an involuntary case,
(B) appoints a Custodian of either of the Company or any
Restricted Subsidiary with assets in excess of $1,000,000 or for all
or substantially all of the property of either of the Company or any
such Restricted Subsidiary, or
(C) orders the liquidation of either of the Company or any
Restricted Subsidiary with assets in excess of $1,000,000,
and the order or decree remains unstayed and in effect for 60 days; or
(8) any of the Guarantees of a Material Subsidiary ceases to be in
full force and effect or any of the Guarantees of a Material Subsidiary is
declared to be null and void and unenforceable or any of the Guarantees of
a Material Subsidiary is found to be invalid or any of the Guarantors
denies its liability under its Guarantee (other than by reason of release
of a Guarantor in accordance with Section 10.05 hereof).
Subject to Sections 7.01 and 7.02 hereof, the Trustee shall not be
charged with knowledge of any Default, Event of Default, Change of Control or
Asset Sale or the requirement for payment of Additional Interest unless written
notice thereof shall have been given to a Responsible Officer at the Corporate
Trust Office of the Trustee by the Company or any other Person.
SECTION 6.02. ACCELERATION.
If an Event of Default (other than an Event of Default described in
clause (6) or (7) of Section 6.01 hereof) shall have occurred and be continuing,
then the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Notes then outstanding by written notice to the Company (and to
the Trustee if given by the Holders) may declare to be immediately due and
payable the entire principal amount of all the Notes then outstanding plus
accrued and unpaid interest to the date of acceleration and the same shall
become immediately due and payable; PROVIDED that after such acceleration but
before a judgment or decree based on acceleration is obtained by the Trustee,
the Holders of a majority in aggregate principal amount of outstanding Notes
may, under certain circumstances, rescind and annul such acceleration if (i) all
Events of Default, other than non-payment of principal, premium, if any, or
interest that has become due solely because of the acceleration, have been cured
or
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waived as provided in this Indenture, (ii) to the extent the payment of such
interest is lawful, interest on overdue installments of interest and overdue
principal, which has become due otherwise than by such declaration of
acceleration, has been paid, (iii) if the Company has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its expenses,
disbursements and advances including the reasonable fees and expenses of counsel
and (iv) in the event of the cure or waiver of an Event of Default of the type
described in clause (6) or (7) of Section 6.01 hereof, the Trustee shall have
received an Officers' Certificate and an Opinion of Counsel that such Event of
Default has been cured or waived. No such rescission shall affect any subsequent
Default or impair any right consequent thereto. In case an Event of Default
described in clause (6) or (7) of Section 6.01 hereof, the principal, premium
and interest amount with respect to all of the Notes shall be due and payable
immediately without any declaration or other act on the part of the Trustee or
the Holders.
SECTION 6.03. OTHER REMEDIES.
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 the
payment of principal of, or premium, if any, and interest 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 in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is exclusive of any
other remedy. All available remedies are cumulative to the extent permitted by
law. Any costs associated with actions taken by the Trustee under this Section
6.03 shall be reimbursed to the Trustee by the Company.
SECTION 6.04. WAIVER OF PAST DEFAULTS AND EVENTS OF DEFAULT.
Subject to Sections 6.02, 6.08 and 8.02 hereof, the Holders of a
majority in principal amount of the Notes then outstanding by written notice to
the Trustee have the right to waive any existing Default or Event of Default or
compliance with any provision of this Indenture or the Notes. The Company shall
deliver to the Trustee an Officers' Certificate stating that the requisite
percentage of Holders has consented to such waiver. 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; PROVIDED that
no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any right consequent thereto.
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SECTION 6.05. CONTROL BY MAJORITY.
The Holders of a majority in principal amount of the Notes outstanding
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee by this Indenture. The Trustee, however, 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
not taking part in such direction, and the Trustee shall have the right to
decline to follow any such direction if the Trustee, being advised by counsel,
determines that the action so directed may not lawfully be taken or if the
Trustee in good faith shall, by a Responsible Officer, determine that the
proceedings so directed may involve it in personal liability; PROVIDED that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
SECTION 6.06. LIMITATION ON SUITS.
Subject to Section 6.08 hereof, a Holder may not institute any
proceeding or pursue any remedy with respect to this Indenture or the Notes
unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding make a written request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer and if requested provide to the
Trustee indemnity reasonably satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer, and, if requested, provision of,
indemnity; and
(5) no direction which in the reasonable opinion of the Trustee is
inconsistent with such written request has been given to the Trustee during
such 60 day period by the Holders of a majority in aggregate principal
amount of the Notes then outstanding.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
SECTION 6.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS,
EMPLOYEES AND STOCKHOLDERS.
No past, present or future director, officer, employee, partner,
incorporator or shareholder of the Company or Pacifica Paper Limited Partnership
or any corporate successor
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thereto, as such, shall have any liability for any obligations of the Company
under the Notes, the Guarantees of any Guarantor or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of the Notes 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 6.08. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal of, or premium, if any, and
interest on such Note (including Additional Interest) on or after the respective
due dates expressed on such Note, or to bring suit for the enforcement of any
such payment on or after such respective dates, is absolute and unconditional
and shall not be impaired or affected without the consent of such Holder.
SECTION 6.09. COLLECTION SUIT BY TRUSTEE.
If an Event of Default in payment of principal, premium or interest
specified in clause (1) or (2) of Section 6.01 hereof occurs and is continuing,
the Trustee may recover judgment in its own name and as trustee of an express
trust against the Company or any Guarantor for the whole amount of unpaid
principal and accrued interest remaining unpaid, together with interest on
overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate set forth
in the Notes, and such further amounts 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 6.10. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 hereof) and the Holders allowed in
any judicial proceedings relative to the Company or any Guarantor, its creditors
or its property and shall be entitled and empowered to collect and receive any
monies or other property payable or deliverable on any such claims and to
distribute the same after deduction of its charges and expenses to the extent
that any such charges and expenses are not paid out of the estate in any such
proceedings 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,
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expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof.
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 or
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceedings.
SECTION 6.11. PRIORITIES.
If the Trustee collects any money pursuant to this Article Six, it
shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 hereof;
SECOND: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest (including
Additional Interest, if any) as to each, ratably, without
preference or priority of any kind, according to the amounts
due and payable on the Notes; and
THIRD: to the Company or, to the extent the Trustee collects any
amount from any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.11.
SECTION 6.12. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.12 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.08 hereof or a suit by Holders of more than 10% in
aggregate principal amount of the Notes then outstanding.
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ARTICLE SEVEN
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default actually known to a Responsible Officer of
the Trustee has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise as a prudent man would exercise or use under
the same circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture but, in the case of any such certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform on their face to the
requirements of this Indenture (but need not confirm or investigate
the accuracy of mathematical calculations, the accuracy of the
signatures or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of
this Section 7.01.
(2) The Trustee shall not be liable for any error of judgment
made in good faith, unless it is proved that the Trustee was negligent
in ascertaining the pertinent facts.
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(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to the terms of Sections 6.04 and 6.05 hereof.
(4) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its rights, powers or duties if
it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity satisfactory to it against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, paragraphs (a), (b)
and (c) of this Section 7.01 shall govern every provision of this Indenture that
in any way relates to the Trustee; PROVIDED that the Trustee's conduct does not
constitute gross negligence or bad faith.
(e) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company or any
Guarantor. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by the law.
SECTION 7.02. RIGHTS OF TRUSTEE.
Subject to Section 7.01 hereof:
(1) The Trustee may rely on any document reasonably 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.
(2) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request and any resolution of the Board
of Directors shall be sufficiently evidenced by a Board Resolution.
(3) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both, which shall
conform in all material respects to the provisions of Section 11.05 hereof.
The Trustee shall be protected and shall not be liable for any action it
takes or omits to take in good faith in reliance on such certificate or
opinion.
(4) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed by
it with due care.
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(5) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized or
within its rights or powers.
(6) The Trustee may consult with counsel of its selection, and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(7) Whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate.
(8) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, coupon or other paper or document.
(9) The Trustee shall not be deemed to have notice of any Event of
Default unless a Responsible Officer of the Trustee has actual knowledge
thereof or unless the Trustee shall have received written notice thereof at
the Corporate Trust Office of the Trustee, and such notice references the
Notes and this Indenture. As used herein, the term "ACTUAL KNOWLEDGE" means
the actual fact or statement of knowing, without any duty to make any
investigation with regard thereto.
(10) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(11) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against any loss, liability or expense which may be
incurred therein or thereby.
(12) The Trustee shall not be responsible for any information
contained in any notice provision provided to the Trustee by the Company
for distribution to the Holders.
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SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the either of the Company or any Guarantor,
or any Affiliates thereof, with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. The Trustee, however, shall
be subject to Sections 7.10 and 7.11 hereof.
SECTION 7.04. 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 or any Guarantee,
it shall not be accountable for the Company's or any Guarantor's use of the
proceeds from the sale of Notes or any money paid to the Company or any
Guarantor pursuant to the terms of this Indenture and it shall not be
responsible for any statement in the Notes, any Guarantee or this Indenture
other than the Trustee's certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default occurs and is continuing and if the Trustee has actual
knowledge of such default, the Trustee shall mail to each Holder notice of the
Default within 90 days after it occurs. Except in the case of a Default in
payment of the principal of, or premium, if any, or interest on any Note or a
default in the observance or performance of any of the obligations of the
Company under Article Five, the Trustee may withhold the notice if and so long
as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the best interest of the Holders.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS.
If required by TIA -Section-313(a), within 90 days after December 31
of any year, commencing December 31, 1999 the Trustee shall mail to each Holder
a brief report dated as of such December 31 that complies with TIA
-Section-313(a). 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) and TIA -Section-313(d).
Reports pursuant to this Section 7.06 shall be transmitted by mail:
(1) to all Holders of Notes, as the names and addresses of such
Holders appear on the Registrar's books; and
(2) to such Holders of Notes as have, within the two years preceding
such transmission, filed their names and addresses with the Trustee for
that purpose.
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A copy of each report at the time of its mailing to Holders shall be
filed with the Commission and each stock exchange on which the Notes are listed.
The Company shall promptly notify the Trustee when the Notes are listed on any
stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company and any Guarantors shall pay to the Trustee and each Agent
from time to time reasonable compensation for its services hereunder (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust). The Company and any Guarantors
shall reimburse the Trustee and each Agent upon request for all reasonable
disbursements, expenses and advances incurred or made by it in connection with
its duties under this Indenture, including the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
The Company and any Guarantors shall indemnify each of the Trustee and
any predecessor Trustee and each Agent for, and hold each of them harmless
against, any and all loss, damage, claim, liability or expense, including
without limitation taxes (other than taxes based on the income of the Trustee or
such Agent) and reasonable attorneys' fees and expenses incurred by each of them
in connection with the acceptance or performance of its duties under this
Indenture including the reasonable costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder (including, without limitation, settlement
costs). The Company and any Guarantor need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld. The
Trustee or Agent, as the case may be, shall notify the Company and any
Guarantors in writing promptly of any claim asserted against the Trustee or such
Agent for which it may seek indemnity. However, the failure by the Trustee or
such Agent to so notify the Company and any Guarantors shall not relieve the
Company and any Guarantors of their obligations hereunder.
Notwithstanding the foregoing, the Company and any Guarantors need not
reimburse the Trustee or any Agent for any expense or indemnify it against any
loss or liability incurred by the Trustee or such Agent, as the case may be,
resulting from its own negligence, willful misconduct or bad faith. To secure
the payment obligations of the Company and any Guarantors in this Section 7.07,
the Trustee shall have a lien prior to the Notes on all money or property held
or collected by the Trustee except such money or property held in trust to pay
principal of and interest on particular Notes. The obligations of the Company
and any Guarantors under this Section 7.07 to compensate and indemnify the
Trustee and each predecessor Trustee and to pay or reimburse the Trustee and
each predecessor Trustee for expenses, disbursements and advances shall be joint
and several liabilities of the Company and any Guarantors and shall survive the
resignation or removal of
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the Trustee and the satisfaction, discharge or other termination of this
Indenture, including any termination or rejection hereof under any Bankruptcy
Law.
When the Trustee incurs expenses (including reasonable fees and
expenses of its Agents and counsel) or renders services after an Event of
Default specified in clause (6) or (7) of Section 6.01 hereof occurs, the
expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.
For purposes of this Section 7.07, the term "Trustee" shall include
any trustee appointed pursuant to Article Nine.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
The Trustee may resign by so notifying the Company and any Guarantors
in writing. The Holders of a majority in principal amount of the outstanding
Notes may remove the Trustee by notifying the Company and the removed Trustee in
writing and may appoint a successor Trustee with the Company's written consent,
which consent shall not be unreasonably withheld. The Company may remove the
Trustee at its election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of performing its duties
hereunder.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify the Holders of such
event and shall promptly appoint a successor Trustee. Within one year after such
successor Trustee takes office, the Holders of a majority in aggregate principal
amount of the Notes then outstanding may appoint a successor Trustee to replace
such 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 a majority in principal amount of the outstanding Notes may petition
any court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately following
such delivery, the retiring Trustee shall, subject to its rights under Section
7.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, 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. A successor Trustee shall mail
notice of its succession to each Holder. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company's and any Guarantors'
obligations under Section 7.07 hereof shall continue for the benefit of the
retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY CONSOLIDATION, MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 7.10 hereof, the successor corporation without
any further act shall be the successor Trustee; PROVIDED such entity shall be
otherwise qualified and eligible under this Article Seven.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA -Section-310(a)(1) and (2) in every respect. The Trustee
(together with its corporate parent) shall have a combined capital and surplus
of at least US$100,000,000 as set forth in the most recent applicable published
annual report of condition. The Trustee shall comply with TIA -Section-310(b),
including the provision in -Section-310(b)(1).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with 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.
SECTION 7.12. PAYING AGENTS.
The Company shall cause each Paying Agent other than the Trustee to
execute and deliver to it and the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 7.12:
(1) that it will hold all sums held by it as agent for the payment of
principal of, or premium, if any, or interest on, the Notes (whether such
sums have been paid to it by the Company, any Guarantor or by any other
obligor on the Notes) in trust for the benefit of Holders of the Notes or
the Trustee;
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(2) that it will at any time during the continuance of any Event of
Default, upon written request from the Trustee, deliver to the Trustee all
sums so held in trust by it together with a full accounting thereof; and
(3) that it will give the Trustee written notice within three (3)
Business Days of any failure of the Company, any Guarantor or by any
obligor on the Notes in the payment of any installment of the principal of,
premium, if any, or interest on, the Notes when the same shall be due and
payable.
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. WITHOUT CONSENT OF HOLDERS.
The Company and any Guarantors, when authorized by a Board Resolution
of each of them, and the Trustee, when an Officers' Certificate is provided
stating that such amendment or supplement complies with the provisions of this
Section 8.01, may amend, waive or supplement this Indenture or the Notes without
notice to or consent of any Holder:
(1) to comply with Section 5.01 hereof;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(3) to comply with any requirements of the Commission under the TIA;
(4) to cure any ambiguity, defect or inconsistency;
(5) to add a Guarantor;
(6) to provide for the issuance of the Exchange Notes or the
Private Exchange Notes in accordance with Section 2.01 hereof in a
manner that does not adversely affect the rights of any Holder;
(7) to provide for the assumption of the Company's or a
Guarantor's obligations to Holders in the event of a merger or
consolidation in accordance with the terms of this Indenture;
(8) in reliance on an Opinion of Counsel, to make any other
change that does not adversely affect the rights of any Holders
hereunder; or
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(9) to comply with the requirements of the Commission to effect
or maintain the qualification of this Indenture under the TIA.
The Trustee is hereby authorized to join with the Company and any
Guarantors in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained, but the Trustee
shall not be obligated to enter into any such supplemental indenture which
adversely affects its own rights, duties or immunities under this Indenture.
SECTION 8.02. WITH CONSENT OF HOLDERS.
The Company (when authorized by a Board Resolution) and any Guarantors
(when authorized by a Board Resolution) may, subject to Section 8.06 hereof,
direct the Trustee to modify or supplement this Indenture, the Guarantees and/or
the Notes with the written consent of the Holders of at least a majority in
aggregate principal amount of the outstanding Notes. The Holders of not less
than a majority in aggregate principal amount of the outstanding Notes may waive
compliance in a particular instance by the Company or any Guarantor with any
provision of this Indenture or the Notes. Subject to Section 8.04 hereof,
without the consent of each Holder affected, however, an amendment, supplement
or waiver, including a waiver pursuant to Section 6.04 hereof, may not:
(1) reduce the amount of Notes whose Holders must consent to an
amendment, supplement or waiver to this Indenture;
(2) reduce the rate of, change the method of calculation of or
change the time for payment of interest, including defaulted interest,
on any Note;
(3) reduce the principal of or premium on or change the stated
maturity of any Note or change the date on which any Notes may be
subject to redemption or repurchase or reduce the redemption or
repurchase price therefor;
(4) make any Note payable in money other than that stated in the
Note or change the place of payment from
New York,
New York;
(5) waive a default on the payment of the principal of, interest
on, or redemption payment with respect to any Note (except a
rescission of acceleration of the Notes in accordance with the terms
of this Indenture or a waiver of the payment default that resulted
from such acceleration in accordance with the terms of this
Indenture);
(6) make any change in provisions of this Indenture protecting
the right of each Holder to receive payment of principal of and
interest on such Note on or after
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the due date thereof or to bring suit to enforce such payment, or
permitting Holders of a majority in principal amount of Notes to waive
Defaults or Events of Default;
(7) amend, change or modify in any material respect the
obligation of the Company to make and consummate a Change of Control
Offer in the event of a Change of Control Triggering Event or make and
consummate an Excess Proceeds Offer with respect to any Asset Sale
that has been consummated or modify any of the provisions or
definitions with respect thereto;
(8) modify or change any provision of this Indenture or the
related definitions affecting the ranking of the Notes or any
Guarantee in a manner which adversely affects the Holders; or
(9) release any Guarantor from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with the
terms of this Indenture.
After an amendment, supplement or waiver under this Section 8.02
becomes effective, the Company shall mail to the Holders a notice briefly
describing the amendment, supplement or waiver.
Upon the written request of the Company, accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the receipt by the Trustee of evidence reasonably satisfactory to the
Trustee of the consent of the Holders as aforesaid and upon receipt by the
Trustee of the documents described in Section 8.06 hereof, the Trustee shall
join with the Company and any Guarantors in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture, in which case the Trustee may, but
shall not be obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section 8.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
SECTION 8.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall
comply with the TIA as then in effect.
SECTION 8.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement, waiver or other action becomes
effective, a consent to it by a Holder is a continuing consent conclusive and
binding upon such Holder and
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every subsequent Holder of the same Note or portion thereof, and of any Note
issued upon the transfer thereof or in exchange therefor or in place thereof,
even if notation of the consent is not made on any such Note. Any such Holder or
subsequent Holder, however, may revoke the consent as to his Note or portion of
a Note, if the Trustee receives the written notice of revocation before the date
the amendment, supplement, waiver or other action becomes effective.
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
preceding paragraph, those Persons who were Holders at such record date (or
their duly designated proxies), and only such Persons, shall be entitled to
consent to such amendment, supplement, or waiver or to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 120 days
after such record date unless the consent of the requisite number of Holders has
been obtained.
An amendment, supplement, waiver or other action becomes effective in
accordance with its terms and thereafter shall bind every Holder, unless it
makes a change described in any of clauses (1) through (9) of Section 8.02
hereof. In that case the amendment, supplement, waiver or other action shall
bind each Holder who has consented to it and every subsequent Holder or portion
of a Note that evidences the same debt as the consenting Holder's Note.
SECTION 8.05. NOTATION ON OR EXCHANGE OF NOTES.
If an amendment, supplement, or waiver changes the terms of a Note,
the Trustee (in accordance with the specific written direction of the Company)
shall request the Holder of the Note (in accordance with the specific written
direction of the Company) to deliver it to the Trustee. In such case, the
Trustee shall at the expense of the Company place an appropriate notation on the
Note about the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Note shall
issue, any Guarantors shall endorse and the Trustee shall authenticate a new
Note that reflects the changed terms. 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 8.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article Eight if the amendment, supplement or waiver does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may, but need not, sign it. In signing or refusing to
sign such amendment, supplement or waiver the Trustee shall be entitled to
receive and, subject to Section 7.01 hereof, shall be fully protected
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in relying upon an Officers' Certificate and an Opinion of Counsel stating, in
addition to the matters required by Section 11.04 hereof, that such amendment,
supplement or waiver is authorized or permitted by this Indenture and is a
legal, valid and binding obligation of the Company and any Guarantors,
enforceable against the Company and any Guarantors in accordance with its terms
(subject to customary exceptions).
ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. DISCHARGE OF INDENTURE.
The Company may terminate its obligations under the Notes and this
Indenture as well as the obligations of any Guarantors under their respective
Guarantees, except those obligations referred to in the penultimate paragraph of
this Section 9.01 if:
(i) either (a) all the Notes theretofore authenticated and
delivered (except lost, stolen or destroyed Notes which have been
replaced or paid and Notes for whose payment money has theretofore
been deposited in trust or segregated and held in trust by the Company
and thereafter repaid to the Company or discharged from such trust)
have been delivered to the Trustee for cancellation or (b) all Notes
not theretofore delivered to the Trustee for cancellation have become
due and payable and the Company has irrevocably deposited or caused to
be deposited with the Trustee funds in an amount sufficient to pay and
discharge the entire Indebtedness on the Notes not theretofore
delivered to the Trustee for cancellation, for principal of, premium,
if any, and interest on the Notes to the date of deposit together with
irrevocable instructions from the Company directing the Trustee to
apply such funds to the payment thereof at maturity or redemption, as
the case may be;
(ii) the Company has paid all other sums payable under this
Indenture by the Company; and
(iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel stating that all conditions
precedent under this Indenture relating to the satisfaction and
discharge of this Indenture have been complied with.
Notwithstanding the first paragraph of this Section 9.01, the
Company's obligations in Sections 2.06, 2.07, 2.08, 2.09, 4.16, 7.07, 9.05 and
9.06 hereof shall survive until the Notes are no longer outstanding pursuant to
the last paragraph of Section 2.09 hereof.
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After the Notes are no longer outstanding, the Company's obligations in Section
7.07, 9.05 and 9.06 hereof shall survive.
After such delivery or irrevocable deposit, the Trustee upon written
request of the Company shall acknowledge in writing the discharge of the
Company's and each Guarantor's obligations under the Notes, the Guarantees and
this Indenture, as the case may be, except for those surviving obligations
specified above.
SECTION 9.02. LEGAL DEFEASANCE.
The Company may at its option, by Board Resolution of the Company, be
discharged from its obligations with respect to the Notes and any Guarantors
discharged from their obligations under their respective Guarantees on the date
the conditions set forth in Section 9.04 below are satisfied (hereinafter,
"LEGAL DEFEASANCE"). For this purpose, "Legal Defeasance" means that the Company
and any Guarantors shall be deemed to have paid and discharged the entire
Indebtedness represented by the Notes, which shall thereafter be deemed to be
"outstanding" only for the purposes of 9.08 hereof and the other Sections of
this Indenture referred to in clauses (A) and (B) below, and to have satisfied
all of its other obligations under such Notes, such Guarantees and this
Indenture, as the case may be, insofar as such Notes are concerned (and the
Trustee, at the expense of the Company, shall, subject to Section 9.06 hereof,
execute instruments in form and substance reasonably satisfactory to the Trustee
and the Company acknowledges the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of outstanding Notes to receive solely from the trust funds described in
Section 9.04 hereof, and as more fully set forth in such Section, payments in
respect of the principal of, premium, if any, and interest on such Notes when
such payments are due, (B) the Company's obligations with respect to such Notes
under Sections 2.04, 2.05, 2.07 and 2.11 hereof, (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder (including claims of, or payments
to, the Trustee pursuant to Section 7.07 hereof) and (D) this Article Nine.
Subject to compliance with this Article Nine, the Company may exercise its
option under this Section 9.02 with respect to the Notes notwithstanding the
prior exercise of its option under Section 9.03 below with respect to the Notes.
SECTION 9.03. COVENANT DEFEASANCE.
At the option of the Company, pursuant to a Board Resolution of the
Company, the Company and any Guarantors shall be released from their respective
obligations under Sections 4.02 (except for obligations mandated by the TIA),
4.06 through 4.13, inclusive, and 4.15 and clause (a)(iii) of Section 5.01
hereof with respect to the outstanding Notes on and after the date the
conditions set forth in Section 9.04 hereof are satisfied (hereinafter,
"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
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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 the Company and
any Guarantors may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such specified Section or
portion thereof, whether directly or indirectly by reason of any reference
elsewhere herein to any such specified Section or portion thereof or by reason
of any reference in any such specified Section or portion thereof 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 clause (3) of Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and the
Notes shall be unaffected thereby.
SECTION 9.04. CONDITIONS TO LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The following shall be the conditions to application of Section 9.02
or Section 9.03 hereof to the outstanding Notes:
(1) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee as funds in trust for the purpose of making
the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of the Notes, (A)
money in an amount, or (B) U.S. Government Obligations which through
the scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due date
of any payment, money in an amount, or (C) a combination thereof, in
such amounts as will be sufficient, in the opinion of a
nationally-recognized firm of independent public accountants expressed
in a written certification thereof delivered to the Trustee, to pay
and discharge the principal of, premium, if any, and accrued and
unpaid interest on the Notes, at the maturity date of such principal,
premium, if any, or interest, or on dates for payment and redemption
of such principal, premium, if any, and interest selected in
accordance with the terms of this Indenture and the Notes; PROVIDED
that the Trustee shall have been irrevocably instructed in writing to
apply such money or the proceeds of such U.S. Government Obligations
to the payment of such principal, premium, if any, and interest with
respect to the Notes;
(2) in the case of an election under Section 9.02 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (A) the Company has received from, or there has been
published by, the Internal Revenue Service and Revenue Canada a ruling
or (B) there has been a change in any applicable U.S. federal and
Canadian income tax law, in either case, to the effect that, and such
Opinion of Counsel shall confirm that, the Holders of the outstanding
Notes will not recognize
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income, gain or loss for U.S. federal and Canadian income tax purposes
as a result of such Legal Defeasance and will be subject to U.S.
federal and Canadian 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;
(3) in the case of an election under Section 9.03 hereof, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the outstanding Notes will not
recognize income, gain or loss for U.S. federal and Canadian income
tax purposes as a result of such Covenant Defeasance and will be
subject to U.S. federal and Canadian income tax on the same amounts,
in the same manner and at the same times as would have been the case
if such Covenant Defeasance had not occurred;
(4) no Event of Default or Default (or an event which with notice
or lapse of time or both would become a Default or Event of Default)
with respect to the Notes shall have occurred and be continuing on the
date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness the proceeds of which
will be used to defease the Notes pursuant to this Article Nine
concurrently with such incurrence) or insofar as clause (6) or (7) of
Section 6.01 hereof are concerned, at any time in the period ending on
the 91st day after the date of such deposit;
(5) such Legal Defeasance or Covenant Defeasance shall not result
in a breach or violation of, or constitute default under this
Indenture or any other material agreement or instrument to which the
Company or any of its Subsidiaries is a party or by which the Company
or any of its Subsidiaries is bound;
(6) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause (1) of this Section
9.04 was not made by the Company with the intent of preferring the
Holders of the Notes over any other creditors of the Company or with
the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others;
(7) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the Legal
Defeasance under Section 9.02 hereof or the Covenant Defeasance under
Section 9.03 hereof, as the case may be, have been complied with;
(8) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that, assuming no intervening bankruptcy or
insolvency of the Company between the date of deposit and the 91st day
following the date of deposit, the trust funds will not be subject to
the effect of any applicable Bankruptcy Law, and that no
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Holder is an insider of the Company, after the 91st day following the
date of deposit; and
(9) the Company shall have paid or duly provided for payment
under terms mutually satisfactory to the Company and the Trustee all
amounts then due to the Trustee pursuant to Section 7.07 hereof.
SECTION 9.05. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE
HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 9.04 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, to the Holders of such Notes, of
all sums due and to become due thereon in respect of principal, premium, if any,
and accrued interest, but such money need not be segregated from other funds
except to the extent required by law.
The Company and any Guarantors shall (on a joint and several basis)
pay and indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the U.S. Government Obligations deposited pursuant to Section
9.04 hereof or the principal, premium, if any, 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 Nine to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon a Company
Request any money or U.S. Government Obligations held by it as provided in
Section 9.04 hereof which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
SECTION 9.06. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article Nine by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and each Guarantor's obligations under this
Indenture, the Notes and the Guarantees, as the case may be, shall be revived
and reinstated as though no deposit had occurred pursuant to this Article Nine
until such time as the Trustee or Paying Agent is permitted to apply all such
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money or U.S. Government Obligations in accordance this Article Nine; PROVIDED
that if the Company or any Guarantors have made any payment of principal of,
premium, if any, or accrued interest on any Notes because of the reinstatement
of their obligations, the Company or such Guarantor, as the case may be, shall
be subrogated to the rights of the Holders of such Notes to receive such payment
from the money or U.S. Government Obligations, as the case may be, held by the
Trustee or Paying Agent.
SECTION 9.07. MONEYS HELD BY PAYING AGENT.
In connection with the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon written demand of the Company, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 9.04 hereof, to the
Company upon a Company Request (or, if such moneys had been deposited by any
Guarantors, to such Guarantors), and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
SECTION 9.08. MONEYS HELD BY TRUSTEE.
Any moneys deposited with the Trustee or any Paying Agent or then held
by the Company or any Guarantor in trust for the payment of the principal of, or
premium, if any, or interest on any Note that are not applied but remain
unclaimed by the Holder of such Note for two years after the date upon which the
principal of, or premium, if any, or interest on such Note shall have
respectively become due and payable, shall be repaid to the Company (or, if
appropriate, any Guarantor) upon a Company Request, or if such moneys are then
held by the Company or any Guarantor in trust, such moneys shall be released
from such trust; and the Holder of such Note entitled to receive such payment
shall thereafter, as an unsecured general creditor, look only to the Company and
any Guarantors for the payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; PROVIDED,
that the Trustee or any such Paying Agent, before being required to make any
such repayment, may, at the expense of the Company and any Guarantors, either
mail to each Holder affected, at the address shown in the register of the Notes
maintained by the Registrar pursuant to Section 2.03 hereof, or cause to be
published once a week for two successive weeks, in a newspaper published in the
English language, customarily published each Business Day and of general
circulation in the City of
New York,
New York, a 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 mailing or publication, any unclaimed balance of
such moneys then remaining will be repaid to the Company. After payment to the
Company or any Guarantor or the release of any money held in trust by the
Company or any Guarantor, as the case may be, Holders entitled to the money must
look only to the Company and any Guarantors for payment as general creditors
unless applicable abandoned property law designates another Person.
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ARTICLE TEN
GUARANTEE OF NOTES
SECTION 10.01. GUARANTEE.
Subject to the provisions of this Article Ten each Guarantor hereby
jointly and severally unconditionally guarantees, on a senior unsecured basis,
to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors, irrespective of (i) the validity and enforceability
of this Indenture, the Notes or the obligations of the Company or any other
Guarantors to the Holders or the Trustee hereunder or thereunder or (ii) the
absence of any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or default of a Guarantor,
that: (a) the principal of, premium, if any, interest and Additional Interest,
if any, on and any Additional Amounts, if any, with respect to the Notes will be
duly and punctually paid in full when due, whether at maturity, by acceleration
or otherwise, and interest on the overdue principal and (to the extent permitted
by law) interest or Additional Interest, if any, on or Additional Amounts, if
any, with respect to the Notes and all other obligations of the Company or any
Guarantor to the Holders or the Trustee hereunder or thereunder (including
amounts due the Trustee under Section 7.07 hereof) and all other obligations
under this Indenture or the Notes will be promptly paid in full or performed,
all in accordance with the terms hereof and thereof; and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, the same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed, or failing performance of any other obligation of the Company to
the Holders, for whatever reason, each Guarantor will be obligated to pay, or to
perform or cause the performance of, the same immediately. An Event of Default
under this Indenture or the Notes shall constitute an event of default under
this Guarantee, and shall entitle the Holders of Notes or the Trustee to
accelerate the obligations of the Guarantors hereunder in the same manner and to
the same extent as the obligations of the Company.
Each Guarantor, by execution of the Guarantee, agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of this Indenture or the Notes, the absence of any
action to enforce the same, any waiver or consent by any Holder with respect to
any provisions hereof or thereof, any release of any other Guarantor, the
recovery of any judgment against the Company, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Note, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor. Each Guarantor, by execution of the Guarantee, waives
the benefit of diligence, presentment,
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demand for payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenant that such
Guarantee will not be discharged except by complete performance of the
obligations contained in the Notes, this Indenture and such Guarantee. The
Guarantee is a guarantee of payment and not of collection. If any Holder or the
Trustee is required by any court or otherwise to return to the Company or to any
Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to the Company or such Guarantor, any amount paid by the
Company or such Guarantor to the Trustee or such Holder, the Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each Guarantor further agrees that, as between it, on the one hand, and the
Holders and the Trustee, on the other hand, (a) subject to this Article Ten, the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article Six hereof for the purposes of the Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (b) in the event of any acceleration of such
obligations as provided in Article Six hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by the Guarantors for
the purpose of such Guarantee.
The Guarantee shall remain in full force and effect and continue to be
effective should any petition be filed by or against the Company for liquidation
or reorganization, should the Company become insolvent or make an assignment for
the benefit of creditors or should a receiver or trustee be appointed for all or
any significant part of the Company's assets, and shall, to the fullest extent
permitted by law, continue to be effective or be reinstated, as the case may be,
if at any time payment and performance of the Notes are pursuant to applicable
law, rescinded or reduced in amount, or must otherwise be restored or returned
by any obligee on the Notes, whether as a "voidable preference," "fraudulent
transfer" or otherwise, all as though such payment or performance had not been
made. In the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned, the Notes shall, to the fullest extent permitted by law,
be reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
No shareholder, officer, director, employee or incorporator, past,
present or future, or any Guarantor, as such, shall have any personal liability
under this Guarantee by reason of his, her or its status as such shareholder,
officer, director, employee or incorporator.
SECTION 10.02. EXECUTION AND DELIVERY OF GUARANTEE.
To further evidence the Guarantee set forth in Section 10.01 hereof,
each Guarantor hereby agrees that a notation of such Guarantee, substantially in
the form included in EXHIBIT F hereto, shall be endorsed on each Note
authenticated and delivered by the Trustee after this Article Ten with respect
to such Guarantor becomes effective in accordance with
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Section 4.13 hereof and such Guarantee shall be executed by either manual or
facsimile signature of an Officer of each Guarantor. The validity and
enforceability of any Guarantee shall not be affected by the fact that it is not
affixed to any particular Note.
Each of the Guarantors hereby agrees that its Guarantee set forth in
Section 10.01 hereof shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Guarantee no longer holds that office at the time the Trustee authenticate the
Note on which such Guarantee is endorsed or at any time thereafter, such
Guarantor's Guarantee of such Note shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Indenture on behalf of the Guarantor.
SECTION 10.03. LIMITATION OF GUARANTEE.
The obligations of each Guarantor are limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor and after giving effect to any collections from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Indenture, result in the obligations of such Guarantor under the Guarantee
not constituting a fraudulent conveyance or fraudulent transfer under federal or
state law. Each Guarantor that makes a payment or distribution under a Guarantee
shall be entitled to a contribution from each other Guarantor in a PRO RATA
amount based on the net assets of each Guarantor, determined in accordance with
GAAP.
SECTION 10.04. ADDITIONAL GUARANTORS.
Any Person may become a Guarantor by executing and delivering to the
Trustee a supplemental indenture in accordance with Section 4.13 hereof.
SECTION 10.05. RELEASE OF GUARANTOR.
A Guarantor shall be released from all of its obligations under its
Guarantee if:
(i) the Guarantor has sold all of its assets or the Company and
its Restricted Subsidiaries have sold all of the Capital Stock of the
Guarantor owned by them, in each case in a transaction in compliance
with the terms of this Indenture (including Sections 4.10 and 5.01
hereof);
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(ii) the Guarantor merges with or into or consolidates with, or
transfers all or substantially all of its assets to, the Company or
another Guarantor in a transaction in compliance with Section 5.01
hereof; or
(iii) the Guarantor is designated an Unrestricted Subsidiary in
compliance with the terms of this Indenture (including Section 4.08
hereof);
and in each such case, the Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to such transactions have been complied
with and that such release is authorized and permitted hereunder.
If all of the conditions to release contained in this Section 10.05
have been satisfied, the Trustee shall execute any documents reasonably
requested by the Company or any Guarantor in order to evidence the release of
such Guarantor from its obligations under its Guarantee endorsed on the Notes
and under this Article Ten.
SECTION 10.06. WAIVER OF SUBROGATION.
Each Guarantor, by execution of its Guarantee, waives to the extent
permitted by law any claim or other rights which it may now or hereafter acquire
against the Company that arise from the existence, payment, performance or
enforcement of such Guarantor's obligations under such Guarantee and this
Indenture, including, without limitation, any right of subrogation,
reimbursement, exoneration, indemnification, and any right to participate in any
claim or remedy of any Holder against the Company, whether or not such claim,
remedy or right arises in equity, or under contract, statute or common law,
including, without limitation, the right to take or receive from the Company,
directly or indirectly, in cash or other property or by set-off or in any other
manner, payment or Note on account of such claim or other rights. If any amount
shall be paid to any Guarantor in violation of the preceding sentence and the
Notes shall not have been paid in full, such amount shall have been deemed to
have been paid to such Guarantor for the benefit of, and held in trust for the
benefit of, the Holders of the Notes, and shall forthwith be paid to the Trustee
for the benefit of such Holders to be credited and applied upon the Notes,
whether matured or unmatured, in accordance with the terms of this Indenture.
Each Guarantor, by execution of its Guarantee, will acknowledge that it will
receive direct and indirect benefits from the financing arrangements
contemplated by this Indenture and that the waiver set forth in this Section
10.06 is knowingly made in contemplation of such benefits.
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ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
SECTION 11.02. NOTICES.
Except for notice or communications to Holders, any notice or
communication shall be given in writing and delivered in person, sent by
facsimile, delivered by commercial courier service or mailed by first-class
mail, postage prepaid, addressed as follows:
If to the Company or any Guarantor:
PACIFICA PAPERS INC.
000 Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0
XXXXXX
Attention: Chief Financial Officer
Fax Number: (000) 000-0000
with, in the case of any notice furnished pursuant to Article Six
hereof, a copy to:
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SANGRA, MOLLER
X.X. Xxx 00000
Xxxxx 0000
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X XX0
XXXXXX
Attention: H.S. Sangra
Fax Number: (000) 000-0000
If to the Trustee:
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Norwest Center
Sixth and Marquette
Xxxxxxxxxxx, XX 00000
Attention: Corporate Trust Services
Fax Number: (000) 000-0000
Such notices or communications shall be effective when received and
shall be sufficiently given if so given within the time prescribed in this
Indenture.
The Company, any Guarantor or the Trustee by written notice to the
others may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed to him
by first-class mail, postage prepaid, at his address shown on the register kept
by the Registrar.
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 to a Holder is mailed in the manner provided above, it shall be
deemed duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
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SECTION 11.03. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
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 Guarantors, the Trustee, the Registrar and anyone else shall have
the protection of TIA -Section-312(c).
SECTION 11.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company or any Guarantor to the
Trustee to take any action under this Indenture, the Company or such Guarantor
shall furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements
set forth in Section 11.05 below) stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set
forth in Section 11.05 below) stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 11.05. STATEMENTS REQUIRED IN CERTIFICATE AND OPINION.
Each certificate and opinion with respect to compliance by or on
behalf of the Company or any Guarantor with a condition or covenant provided for
in this Indenture shall include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, it or he has
made such examination or investigation as is necessary to enable it or
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
Person, such covenant or condition has been complied with.
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SECTION 11.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or meetings of
Holders. The Registrar and Paying Agent may make reasonable rules for their
functions.
SECTION 11.07. BUSINESS DAYS; LEGAL HOLIDAYS.
A "BUSINESS DAY" is a day that is not a Legal Holiday. A "LEGAL
HOLIDAY" is a Saturday, a Sunday, a United States or Canadian
federally-recognized holiday or a day on which banking institutions are not
required to be open in the State of
New York or the Province of British
Columbia. 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.
SECTION 11.08. GOVERNING LAW.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 11.09. AGENT FOR SERVICE; SUBMISSION TO JURISDICTION; WAIVER
OF IMMUNITIES.
By the execution and delivery of this Indenture, each of the Company
and each Guarantor (i) acknowledges that it has, by separate written instrument,
designated and appointed CT Corporation as its authorized agent upon which
process may be served in any suit, action or proceeding arising out of or
relating to the Notes or this Indenture that may be instituted in any Federal or
State court in the State of New York, Borough of Manhattan, or brought under
Federal or State securities laws or brought by the Trustee (whether in its
individual capacity or in its capacity as Trustee hereunder), and acknowledges
that CT Corporation has accepted such designation, (ii) submits to the
jurisdiction of any such court in any such suit, action or proceeding, and (iii)
agrees that service of process upon CT Corporation and written notice of said
service to it (mailed or delivered to its Executive Director at its principal
office as specified in Section 11.02 hereof), shall be deemed in every respect
effective service of process upon it in any such suit or proceeding. The Company
and each Guarantor further agree to take any and all action, including the
execution and filing of any and all such documents and instruments as may be
necessary to continue such designation and appointment of CT Corporation, in
full force and effect so long as this Indenture shall be in full force and
effect; PROVIDED that the Company may and shall (to the extent CT
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Corporation ceases to be able to be served on the basis contemplated herein), by
written notice to the Trustee, designate such additional or alternative agents
for service of process under this Section 11.09 that (i) maintains an office
located in the Borough of Manhattan, The City of New York in the State of New
York, (ii) are either (x) counsel for the Company or (y) a corporate service
company which acts as agent for service of process for other Persons in the
ordinary course of its business and (iii) agrees to act as agent for service of
process in accordance with this Section 11.09. Such notice shall identify the
name of such agent for process and the address of such agent for process in the
Borough of Manhattan, The City of New York, State of New York. Upon the request
of any Holder, the Trustee shall deliver such information to such Holder.
Notwithstanding the foregoing, there shall, at all times, be at least one agent
for service of process for the Company and any Guarantors, if any, appointed and
acting in accordance with this Section 11.09.
To the extent that the Company or any Guarantor has or hereafter may
acquire any immunity from jurisdiction of any court or from any legal process
(whether through service of notice, attachment prior to judgment, attachment in
aid of execution, execution or otherwise) with respect to itself or its
property, the Company and such Guarantor hereby irrevocably waives such immunity
in respect of its obligations under this Indenture and the Securities, to the
extent permitted by law.
SECTION 11.10. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan,
security or debt agreement of the Company or any Subsidiary thereof. No such
indenture, loan, security or debt agreement may be used to interpret this
Indenture.
SECTION 11.11. NO RECOURSE AGAINST OTHERS.
No recourse for the payment of the principal of or premium, if any, or
interest, including Additional Interest, on any of the Notes, or for any claim
based thereon or otherwise in respect thereof, and no recourse under or upon any
obligation, covenant or agreement of the Company or any Guarantor in this
Indenture or in any supplemental indenture, or in any of the Notes, or because
of the creation of any Indebtedness represented thereby, shall be had against
any stockholder, officer, director or employee, as such, past, present or
future, of the Company or of any successor corporation or against the property
or assets of any such stockholder, officer, employee or director, either
directly or through the Company or any Guarantor, or any successor corporation
thereof, whether by virtue of any constitution, statute or rule of law, or by
the enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the Notes are solely obligations of the
Company and the Guarantors, and that no such personal liability whatever shall
attach to, or is or shall be incurred by, any shareholder, officer, employee or
director of the Company or any Guarantor, or any successor corporation thereof,
because of the creation of the indebtedness hereby authorized, or under or
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by reason of the obligations, covenants or agreements contained in this
Indenture or the Notes or implied therefrom, and that any and all such personal
liability of, and any and all claims against every stockholder, officer,
employee and director, are hereby expressly waived and released as a condition
of, and as a consideration for, the execution of this Indenture and the issuance
of the Notes. It is understood that this limitation on recourse is made
expressly for the benefit of any such shareholder, employee, officer or director
and may be enforced by any of them.
SECTION 11.12. SUCCESSORS.
All agreements of the Company and any Guarantors in this Indenture and
the Notes shall bind their respective successors. All agreements of the Trustee,
any additional trustee and any Paying Agents in this Indenture shall bind its
successor.
SECTION 11.13. MULTIPLE COUNTERPARTS.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
SECTION 11.14. TABLE OF CONTENTS, HEADINGS, ETC.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 11.15. SEPARABILITY.
Each provision of this Indenture shall be considered separable and if
for any reason any provision which is not essential to the effectuation of the
basic purpose of this Indenture or 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 11.16. JUDGMENT CURRENCY.
The Company and each of the Guarantors, jointly and severally, each
agree to indemnify each Holder against any loss incurred by such party as a
result of any judgment or order being given or made for any amount due under
this Indenture and such judgment or order being expressed and paid in a currency
(the "JUDGMENT CURRENCY") other than United States dollars and as a result of
any variation as between (i) the rate of exchange at which the
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Xxxxxx Xxxxxx dollar amount is converted into the Judgment Currency for the
purpose of such judgment or order and (ii) the spot rate of exchange in The City
of New York at which such party on the date of payment of such judgment or order
is able to purchase United States dollars with the amount of the Judgment
Currency actually received by such party. The foregoing indemnity shall continue
in full force and effect notwithstanding any such judgment or order as
aforesaid. The term "spot rate of exchange" shall include any premiums and costs
of exchange payable in connection with the purchase of, or conversion into,
United States dollars.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed all as of the date and year first written above.
THE ISSUER:
PACIFICA PAPERS INC.
By: /s/ X. Xxxxxxx
_________________________________
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
THE GUARANTORS:
PACIFICA POPLARS LTD.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
PACIFICA POPLARS INC.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
S-2
PACIFICA POWER CO. LTD.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
PACIFICA PAPERS SALES INC.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
PACIFICA PAPERS U.S. INC.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
EXPORT SALES COMPANY INC.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
PACIFICA PAPERS CO. LIMITED
PARTNERSHIP by its general partner
PACIFICA PAPERS INC.
By: /s/ J. Lawn
_________________________________
Name: Xxx Lawn
Title: Vice President-Finance and
Chief Financial Officer
S-3
PACIFICA PAPERS K.K.
By: /s/ A. Small
_________________________________
Name: Xxxxx Small
Title: Director
S-4
THE TRUSTEE:
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
By: /s/ X. Xxxxxxxxx
_________________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Assistant Vice-President
EXHIBIT A
CUSIP
PACIFICA PAPERS INC.
No. US$
10% SENIOR NOTE DUE 2009
PACIFICA PAPERS INC., a corporation amalgamated under the laws of
Canada (the "Company" which term includes any successor corporation under the
Indenture hereinafter referred to), for value received, promises to pay to
or registered assigns the principal sum of U.S. DOLLARS (US$ )
on March 15, 2009 at the office or agency of the Company referred to below.
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
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IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officers.
PACIFICA PAPERS INC.
By: _________________________________
Name:
Title:
Dated:
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Certificate of Authentication
This is one of the 10% Senior Notes due 2009 referred to in the
within-mentioned Indenture.
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Trustee
By: _________________________________
Name:
Title:
Dated:
A-3
[FORM OF REVERSE OF NOTE]
PACIFICA PAPERS INC.
10% SENIOR NOTE DUE 2009
1. INTEREST. PACIFICA PAPERS INC., a corporation amalgamated under the
laws of Canada (the "Company"), promises to pay, until the principal hereof is
paid or made available for payment, interest on the principal amount set forth
on the face hereof at a rate of 10% per annum. Interest hereon will accrue from
and including the most recent date to which interest has been paid or, if no
interest has been paid, from and including March 12, 1999 to but excluding the
date on which interest is paid. Interest shall be payable in arrears on each
March 15 and September 15 commencing September 15, 1999. Interest will be
computed on the basis of a 360-day year consisting of twelve 30-day months. The
Company shall pay interest on overdue principal and on overdue interest (to the
full extent permitted by law) at a rate of 10% per annum.
2. METHOD OF PAYMENT. The Company will pay interest hereon (except
defaulted interest) to the Persons who are registered Holders at the close of
business on the March 1 or September 1 next preceding the interest payment date
(whether or not a Business Day). Holders must surrender Notes to a Paying Agent
to collect principal payments. The Company will pay principal and interest in
money of the United States of America that at the time of payment is legal
tender for payment of public and private debts. Interest may be paid by check
mailed to the Holder entitled thereto at the address indicated on the register
maintained by the Registrar for the Notes.
3. PAYING AGENT AND REGISTRAR. Initially, Norwest Bank Minnesota,
National Association (the "Trustee") will act as a Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice. The Company
or any of its Affiliates may act as Paying Agent or Registrar.
4. INDENTURE. The Company issued the Notes under an Indenture dated as
of March 12, 1999 (the "Indenture") among the Company, the Guarantors and the
Trustee. This is one of an issue of Notes of the Company issued, or to be
issued, under the Indenture. 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 (15 U.S. Code -Section- 77aaa-77bbbb), as in effect on the
date of the Indenture (the "Act"). The Notes are subject to all such terms, and
Holders are referred to the Indenture and the Act for a statement of them. To
the extent any provision of this Note conflicts with the express provisions of
the Indenture, the provisions of the Indenture shall govern and be controlling.
Capitalized and certain other terms used herein
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and not otherwise defined have the meanings set forth in the Indenture. The
Notes are obligations of the Company limited in aggregate principal amount to
US$200,000,000.
5. ADDITIONAL AMOUNTS. The Company will pay to the Holders of Notes
such Additional Amounts as may become payable under Section 4.16 of the
Indenture.
6. OPTIONAL REDEMPTION. The Company, at its option, may redeem the
Notes, in whole at any time, or in part from time to time on or after March 15,
2004 upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount thereof), set forth below,
together, in each case, with accrued and unpaid interest to the Redemption Date,
if redeemed during the twelve month period beginning on March 15 of each year
listed below:
YEAR REDEMPTION PRICE
---- ----------------
2004.............................................................. 105.000%
2005.............................................................. 103.333%
2006.............................................................. 101.667%
2007 and thereafter............................................... 100.000%
Notwithstanding the foregoing, the Company may redeem in the aggregate
up to 35% of the original principal amount of Notes at any time and from time to
time prior to March 15, 2002 at a redemption price equal to 110% of the
aggregate principal amount so redeemed, plus accrued and unpaid interest to the
Redemption Date out of the net cash proceeds of one or more Public Equity
Offerings; PROVIDED that at least 65% of the principal amount of Notes
originally issued remains outstanding immediately after the occurrence of any
such redemption and that any such redemption occurs within 90 days following the
closing of any such Public Equity Offering.
7. TAX REDEMPTION. The Notes are redeemable, in whole but not in part,
at the option of the Company at any time, upon not less than 30 nor more than 60
days' prior written notice, mailed by first class mail to each Holder at its
last address appearing in the register maintained by the Registrar of Notes, at
100% of the principal amount thereof, plus accrued and unpaid interest thereon
to the Redemption Date, if the Company or any Guarantor is or would become
obligated to pay, on the next date on which any amount would be payable with
respect to the Notes, any Additional Amounts as a result of a change in, or
amendment to, the laws (or any regulations promulgated thereunder) of any Taxing
Authority, or any changes in, or amendment to, any official position regarding
the application or interpretation of such laws or regulations, which change or
amendment is announced or becomes effective on or after the Issue Date; PROVIDED
that the Company or such Guarantor determines, in its business judgment, that
the obligation to pay such Additional Amounts cannot be avoided by the use of
reasonable measures available to the Company or such Guarantor (not including
substitution of the obligor under the Notes).
A-5
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the Redemption Date to each Holder of
Notes to be redeemed at his registered address. On and after the Redemption
Date, unless the Company defaults in making the redemption payment, interest
ceases to accrue on Notes or portions thereof called for redemption, unless the
Company shall fail to redeem any Notes.
9. OFFERS TO PURCHASE. The Indenture provides that upon the occurrence
of a Change of Control or an Asset Sale and subject to further limitations
contained therein, the Company shall make an offer to purchase outstanding Notes
in accordance with the procedures set forth in the Indenture.
[10. REGISTRATION RIGHTS. Pursuant to a Registration Rights Agreement
among the Company, the Guarantors and CIBC Xxxxxxxxxxx Corp. and Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, as Initial Purchasers of the Notes, the
Company and the Guarantors will be obligated to consummate an exchange offer
pursuant to which the Holder of this Note shall have the right to exchange this
Note for notes of a separate series issued under the Indenture (or a trust
indenture substantially identical to the Indenture in accordance with the terms
of the Registration Rights Agreement) which have been registered under the
Securities Act, in like principal amount and having substantially identical
terms as the Notes. The Holders shall be entitled to receive certain additional
interest payments in the event such exchange offer is not consummated and upon
certain other conditions, all pursuant to and in accordance with the terms of
the Registration Rights Agreement.]a
11. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of US$1,000 and integral multiples of
US$1,000. A Holder may transfer or exchange Notes in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay to it any taxes and
fees required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Notes or portion of a Note selected for
redemption, or register the transfer of or exchange any Notes for a period of 15
days before a mailing of notice of redemption.
12. PERSONS DEEMED OWNERS. The registered Holder of this Note may be
treated as the owner of this Note for all purposes.
_____________________
a This section shall be included only in Restricted Notes (but shall not be
included in Exchange Notes or Private Exchange Notes).
A-6
13. UNCLAIMED MONEY. If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Company at its written request. After that, Holders entitled to the
money must look to the Company for payment as general creditors unless an
"abandoned property" law designates another Person.
14. AMENDMENT, SUPPLEMENT, WAIVER, ETC. The Company, any Guarantors
and the Trustee may, without the consent of the Holders of any outstanding
Notes, amend, waive or supplement the Indenture or the Notes for certain
specified purposes, including, among other things, curing ambiguities, defects
or inconsistencies, maintaining the qualification of the Indenture under the Act
and making any change that does not materially and adversely affect the rights
of any Holder. Other amendments and modifications of the Indenture or the Notes
may be made by the Company, any Guarantors and the Trustee with the consent of
the Holders of not less than a majority of the aggregate principal amount of the
outstanding Notes, subject to certain exceptions requiring the consent of the
Holders of the particular Notes to be affected.
15. RESTRICTIVE COVENANTS. The Indenture imposes certain limitations
on the ability of the Company and its Restricted Subsidiaries to, among other
things, incur additional Indebtedness, make payments in respect of their Capital
Stock or certain Indebtedness, make certain Investments, create or incur liens,
enter into transactions with Affiliates, enter into agreements restricting the
ability of Restricted Subsidiaries to pay dividends and make distributions,
issue Capital Stock of any Restricted Subsidiaries of the Company, and on the
ability of the Company to merge or consolidate with any other Person or transfer
all or substantially all of the Company's or any Guarantor's assets. Such
limitations are subject to a number of important qualifications and exceptions.
Pursuant to Section 4.04 of the Indenture, the Company must annually report to
the Trustee on compliance with such limitations.
16. SUCCESSOR CORPORATION. When a successor corporation assumes all
the obligations of its predecessor under the Notes and the Indenture and the
transaction complies with the terms of Article Five of the Indenture, the
predecessor corporation will, except as provided in Article Five, be released
from those obligations.
17. DEFAULTS AND REMEDIES. Events of Default are set forth in the
Indenture. Subject to certain limitations in the Indenture, if an Event of
Default (other than an Event of Default specified in clause (6) or (7) of
Section 6.01 of the Indenture with respect to the Company) occurs and is
continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the then outstanding Notes, by written notice to the Trustee
and the Company, may declare to be immediately due and payable the entire
principal amount of all the Notes then outstanding plus accrued and unpaid
interest to the date of acceleration and
A-7
the same shall become immediately due and payable. If an Event of Default
specified in clause (6) or (7) of Section 6.01 of the Indenture occurs with
respect to the Company, the principal amount of and interest on, all Notes shall
IPSO FACTO become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. The Trustee may
require indemnity satisfactory to it before it enforces the Indenture or the
Notes. Subject to certain limitations, Holders of a majority in principal amount
of the then outstanding Notes may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Holders notice of any continuing
default (except a default in payment of principal, premium, if any, or interest
or a default in the observance or performance of any of the obligations of the
Company under Article Five of the Indenture) if it determines that withholding
notice is in their best interests.
18. TRUSTEE 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 Trustee.
19. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, partner, incorporator or shareholder, of the Company or
Pacifica Paper Limited Partnership or any corporate successor thereto shall have
any liability for any obligations of the Company under the Notes, the Guarantees
of any Guarantors, the Indenture or for a claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder of Notes 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.
20. DISCHARGE. The Company's obligations pursuant to the Indenture
will be discharged, except for obligations pursuant to certain sections thereof,
subject to the terms of the Indenture, upon the payment of all the Notes or upon
the irrevocable deposit with the Trustee of money in United States dollars or
U.S. Government Obligations sufficient to pay when due principal of and interest
on the Notes to maturity or redemption, as the case may be.
21. GUARANTEES. The Note is entitled to the benefits of certain
Guarantees made for the benefit of the Holders. Reference is hereby made to the
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Guarantors, the Trustee and the
Holders.
22. AUTHENTICATION. This Note shall not be valid until the Trustee
signs the certificate of authentication on the other side of this Note.
23. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF
A-8
NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW
YORK, WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT
THAT THE APPLICATION OF LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company and the Guarantors agree to submit to the jurisdiction of
the courts of the State of New York in any action or proceeding arising out of
or relating to the Indenture or the Notes.
24. ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TENANT (=
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).
25. 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.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to:
PACIFICA PAPERS INC.
000 Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0
XXXXXX
Attention: Chief Financial Officer
A-9
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
Date:__________________________ Your Signature:__________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee:_______________________
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 4.10 or Section 4.15 of the Indenture, check the
appropriate box:
/ / Section 4.10 / / Section 4.15
If you want to have only part of the Note purchased by the Company
pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you
elect to have purchased:
US$___________________________________
(multiple of US$1,000)
Date:_________________________________
Your Signature:_____________________________
(Sign exactly as your name appears
on the face of this Note)
______________________________________
Signature Guaranteed
A-11
EXHIBIT B
[FORM OF PRIVATE PLACEMENT LEGEND]
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (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) (AN "ACCREDITED INVESTOR")
OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN "OFFSHORE
TRANSACTION" PURSUANT TO REGULATION S (WITHIN THE MEANING OF RULE 903(c)(2) OF
REGULATION S UNDER THE SECURITIES ACT), (2) AGREES THAT IT WILL NOT PRIOR TO THE
DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY RULE
144(K) (OR ANY SUCCESSOR PROVISION THEREOF) UNDER THE SECURITIES ACT) AFTER THE
LATER OF (A) THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS
SECURITY) AND (B) THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE
COMPANY WAS THE OWNER OF THIS SECURITY OR ANY PREDECESSOR OF THIS SECURITY (THE
"RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL, OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
000X XXXXXX XXX XXXXXX XXXXXX, TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT IS
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF AN INSTITUTIONAL ACCREDITED
INVESTOR, (E) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, PURSUANT TO RULE 904 OF REGULATION S (PROVIDED THAT SUCH
NON-U.S. PERSONS AGREE
B-1
NOT TO RESELL OR OTHERWISE TRANSFER THE SECURITIES IN CANADA OR TO OR FOR THE
BENEFIT OF A CANADIAN RESIDENT, EXCEPT IN ACCORDANCE WITH APPLICABLE CANADIAN
SECURITIES LAWS) OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND (3) AGREES THAT IT WILL
GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. IN CONNECTION WITH ANY
TRANSFER OF THIS SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS
SECURITY, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY 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. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE RESPECTIVE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN THE SUBJECT OF ANY PROSPECTUS
FILED UNDER THE SECURITIES LAWS OF ANY CANADIAN PROVINCE OR TERRITORY. THE
HOLDER OF THE SECURITY BY ITS ACCEPTANCE HEREOF REPRESENTS, IF IT IS A RESIDENT
OF CANADA, THAT IT IS PURCHASING THE SECURITIES IN A TRANSACTION WHICH IS EXEMPT
FROM THE PROSPECTUS REQUIREMENTS OF APPLICABLE CANADIAN SECURITIES LAWS. THE
SALE OF THE SECURITIES TO IT QUALIFIES (BY REASON OF THE AMOUNT OF THE
CONSIDERATION BEING PAID BY THE PURCHASER OF THE SECURITIES OR BY REASON OF THE
STATUS OF THE PURCHASER, AS THE CASE MAY BE) FOR AN EXEMPTION FROM THE
PROSPECTUS FILING AND DELIVERY OBLIGATIONS UNDER APPLICABLE CANADIAN PROVINCIAL
OR TERRITORIAL SECURITIES LAWS (PROVIDED THAT APPLICABLE FILING OBLIGATIONS ARE
SATISFIED AND ANY APPLICABLE FEES ARE PAID), AND IT HAS PROVIDED SUCH
INFORMATION AND MADE SUCH REPRESENTATIONS TO THE SELLER OF THE SECURITIES AS MAY
BE REASONABLY NECESSARY FOR THE SELLER TO RELY ON SUCH EXEMPTIONS AND AGREES
THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE DATE ON WHICH RESALE RESTRICTIONS TERMINATE
UNDER APPLICABLE SECURITIES LAWS.
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[FORM OF ASSIGNMENT FOR
RESTRICTED NOTES]
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
[Check One]
[ ] (a) this Note is being transferred in compliance with the exemption
from registration under the Securities Act provided by Rule 144A
thereunder.
or
[ ] (b) this Note is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the
conditions of transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note in the name of any person other than the Holder
hereof unless and until the conditions to any such transfer of registration set
forth herein and in Sections 2.16 and 2.17 of the Indenture shall have been
satisfied.
Date:___________________________ Your Signature:___________________________
(Sign exactly as your name
appears on the face of this Note)
Signature Guaranteed____________________________________________________________
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TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:____________________________ ____________________________________
NOTICE: To be executed by
an executive officer
B-4
EXHIBIT C
[FORM OF LEGEND FOR GLOBAL NOTE]
Any Global Note authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Note) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN
THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE
(OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF
THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER
NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION) ("DTC") TO THE COMPANY
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IT REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR 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.
C-1
EXHIBIT D
Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
-------------------------------------------------------
_______________________, _____
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
PACIFICA PAPERS INC.
c/o Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Xxxxxxxxxxx, XX 00000
Attention: Corporate Trust Department
Re: Pacifica Papers Inc., a corporation organized under
the Laws of the Province of British Columbia (the "Company")
10% Senior Notes due 2009 (the "Notes")
------------------------------------------------------------
Dear Sirs:
In connection with our proposed purchase of Notes, we confirm that:
1. We are not a resident of Canada or a corporation or other entity
governed by the laws of Canada or any province or territory thereof.
2. We understand that any subsequent transfer of the Notes is subject
to certain restrictions and conditions set forth in the Indenture dated as
of March 12, 1999 relating to the Notes and we agree to be bound by, and
not to resell, pledge or otherwise transfer the Notes except in compliance
with, such restrictions and conditions and the Securities Act of 1933, as
amended (the "Securities Act") and any applicable Canadian securities laws
of any province or territory of Canada.
3. We understand that the Notes have not been registered under the
Securities Act or any other applicable securities laws, have not been and
will not be qualified for sale under the securities laws of Canada or any
province or territory thereof or any other non-U.S. jurisdiction and that
the Notes may not be offered, sold, pledged or otherwise transferred except
as permitted in the following sentence. We agree, on our own behalf and on
behalf of any accounts for which we are acting as hereinafter stated, that
if we should sell any Notes, we will do so only (i) to the Company or any
subsidiary thereof, (ii) in accordance with Rule 144A under the Securities
Act to a "qualified institutional buyer" (as defined in Rule 144A), (iii)
to an institutional "accredited investor" (as defined below) that, prior to
such transfer, furnishes (or has furnished on its behalf by a U.S.
broker-dealer) to you a signed letter containing certain representations
and agreements relating to the restrictions on
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transfer of the Notes, (iv) outside the United States to persons other than
U.S. persons in offshore transactions meeting the requirements of Rule 904
of Regulation S under the Securities Act, (v) pursuant to the exemption
form registration provided by Rule 144 under the Securities Act (if
applicable) or (vi) pursuant to an effective registration statement, and we
further agree to provide to any person purchasing any of the Notes from us
a notice advising such purchaser that resales of the Notes are restricted
as stated herein.
4. We understand that, on any proposed resale of any Notes, we will be
required to furnish to you and the Company such certifications, legal
opinions and other information as you and the Company may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will
bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) and have such
knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we
and any accounts for which we are acting each are able to bear the economic
risk of our or their investment, as the case may be.
6. We are acquiring the Notes purchased by us for our account or for
one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
7. We have no intention of transferring the Notes to a resident of
Canada and (a) we acknowledge that transfers of Notes to residents of
Canada may be restricted under certain circumstances and (b) we agree to
comply with any applicable Canadian provincial securities laws in respect
of any transfer of Notes to a resident of Canada.
You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.
Very truly yours,
[Name of Transferee]
By:____________________________________
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EXHIBIT E
Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
-----------------------------------
______________________, ___
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
PACIFICA PAPERS INC.
c/o Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Xxxxxxxxxxx, XX 00000
Attention: Corporate Trust Department
Re: Pacifica Papers Inc., a corporation amalgamated under the
Laws of Canada (the "Company") 10% Senior Notes
due 2009 (the "Notes")
---------------------------------------------------------
Dear Sirs:
In connection with our proposed sale of US$__________ aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a U.S. person or to a
person in the United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
E-1
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
You and the Company are each entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:___________________________________
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EXHIBIT F
[FORM OF GUARANTEE]
Each of the undersigned (the "Guarantors") hereby jointly and
severally unconditionally guarantees, to the extent set forth in the Indenture
dated as of March 12, 1999 by and between Pacifica Papers Inc., as issuer, the
Guarantors and Norwest Bank Minnesota, National Association, as Trustee (as
amended, restated or supplemented from time to time, the "Indenture"), and
subject to the provisions of the Indenture, (a) the due and punctual payment of
the principal of, and premium, if any, and interest on the Notes, when and as
the same shall become due and payable, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on overdue principal of, and
premium and, to the extent permitted by law, interest, and the due and punctual
performance of all other obligations of the Company to the Holders or the
Trustee, all in accordance with the terms set forth in Article Ten of the
Indenture, and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.
The obligations of the Guarantors to the Holders and to the Trustee
pursuant to this Guarantee and the Indenture are expressly set forth in Article
Ten of the Indenture and reference is hereby made to the Indenture for the
precise terms and limitations of this Guarantee.
[Signatures on Following Pages]
F-1
IN WITNESS WHEREOF, each of the Guarantors has caused this Guarantee
to be signed by a duly authorized officer.
PACIFICA POPLARS LTD.
PACIFICA POPLARS INC.
PACIFICA POWER CO. LTD.
PACIFICA PAPERS SALES INC.
PACIFICA PAPERS U.S. INC.
EXPORT SALES COMPANY INC.
By:_______________________________________
Name:
Title:
PACIFICA PAPERS CO. LIMITED PARTNERSHIP
by its general partner
PACIFICA PAPERS INC.
By::_______________________________________
Name:
Title:
PACIFICA PAPERS K.K.
By::_______________________________________
Name:
Title:
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