Exhibit T3C-1
THE 8.25% SENIOR SECURED NOTES DUE 2011 WILL BE INITIALLY ISSUED IN GLOBAL FORM
AND HELD BY DTC. PLAN PARTICIPANTS ENTITLED TO RECEIVE NOTES WILL BE REQUIRED TO
HOLD THEIR INTERESTS DIRECTLY OR INDIRECTLY THROUGH DTC PARTICIPANTS EXCEPT IN
THE LIMITED CIRCUMSTANCES SET FORTH IN THIS INDENTURE.
COVANTA ENERGY CORPORATION
and each of the Guarantors named herein
$230,000,000 AT STATED MATURITY
8.25% SENIOR SECURED NOTES DUE 2011
-------------------------------
INDENTURE
Dated as of March [___], 2004
-------------------------------
-------------------------------
U.S. BANK NATIONAL ASSOCIATION
as Trustee
-------------------------------
CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
----------- -----------------
310(a)(1)......................................................7.10
(a)(2)....................................................7.10
(a)(3)....................................................N.A.
(a)(4)....................................................N.A.
(a)(5)..............................................7.08, 7.10
(b)..........................................7.08, 7.10, 13.02
(c).......................................................N.A.
311(a).........................................................7.11
(b).......................................................7.11
(c).......................................................N.A.
312(a).........................................................2.05
(b)......................................................13.03
(c)......................................................13.03
313(a).........................................................7.06
(b)(1)....................................................N.A.
(b)(2)....................................................7.06
(c).......................................................7.06
(d).......................................................7.06
314(a)...................................................4.03, 4.04
(b)......................................................10.02
(c)(1).............................................7.02, 13.04
(c)(2).............................................7.02, 13.05
(c)(3)....................................................N.A.
(d)........................................10.03, 10.04, 10.05
(e)......................................................13.05
(f).......................................................N.A.
315(a)......................................................7.01(b)
(b).......................................................7.05
(c).......................................................7.01
(d)..............................................6.05, 7.01(c)
(e).......................................................6.11
316(a) (last sentence)..........................................2.9
(a)(1)(A).................................................6.05
(a)(1)(B).................................................6.04
(a)(2)....................................................N.A.
(b).......................................................6.07
(c).......................................................9.04
317(a)(1)......................................................6.08
(a)(2)....................................................6.09
(b).......................................................2.04
318(a)........................................................13.01
(b).......................................................N.A.
(c)......................................................13.01
----------
N.A. means not applicable
*This Cross Reference Table is not part of the Indenture.
Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE............................................1
Section 1.01 Definitions.......................................................................1
Section 1.02 Other Definitions................................................................30
Section 1.03 Incorporation by Reference of Trust Indenture Act................................30
Section 1.04 Rules of Construction............................................................31
ARTICLE 2. THE NOTES............................................................................31
Section 2.01 Form and Dating..................................................................31
Section 2.02 Execution and Authentication.....................................................32
Section 2.03 Registrar and Paying Agent.......................................................33
Section 2.04 Paying Agent to Hold Money in Trust..............................................33
Section 2.05 Holder Lists.....................................................................33
Section 2.06 Transfer and Exchange............................................................33
Section 2.07 Replacement Notes................................................................38
Section 2.08 Outstanding Notes................................................................38
Section 2.09 Treasury Notes...................................................................38
Section 2.10 Temporary Notes..................................................................38
Section 2.11 Cancellation.....................................................................39
Section 2.12 Defaulted Interest...............................................................39
ARTICLE 3. REDEMPTION AND PREPAYMENT............................................................39
Section 3.01 Notices to Trustee...............................................................39
Section 3.02 Selection of Notes to Be Redeemed or Purchased...................................40
Section 3.03 Notice of Redemption.............................................................40
Section 3.04 Effect of Notice of Redemption...................................................41
Section 3.05 Deposit of Redemption or Purchase Price..........................................41
Section 3.06 Notes Redeemed or Purchased in Part..............................................42
Section 3.07 Optional Redemption..............................................................42
Section 3.08 Mandatory Redemption.............................................................42
Section 3.09 Offer to Purchase by Application of Excess
Proceeds.........................................................................42
ARTICLE 4. COVENANTS............................................................................44
Section 4.01 Payment of Notes.................................................................44
Section 4.02 Maintenance of Office or Agency..................................................45
Section 4.03 Reports..........................................................................45
Section 4.04 Compliance Certificate...........................................................46
Section 4.05 Taxes............................................................................47
Section 4.06 Stay, Extension and Usury Laws...................................................47
Section 4.07 Restricted Payments..............................................................47
Section 4.08 Dividend and Other Payment Restrictions Affecting
Subsidiaries.....................................................................51
Section 4.09 Restrictions on Indebtedness.....................................................53
Section 4.10 Asset Sales......................................................................57
Section 4.11 Transactions with Affiliates.....................................................59
Section 4.12 Liens............................................................................61
Section 4.13 Business Activities..............................................................62
Section 4.14 Corporate Existence..............................................................62
Section 4.15 Offer to Repurchase Upon Change of Control.......................................62
Section 4.16 Payments for Consent.............................................................64
Section 4.17 Additional Subsidiary Guarantees and Liens.......................................64
Section 4.18 Designation of Restricted and Unrestricted Subsidiaries..........................65
Section 4.19 Limitation on Sale and Leaseback Transactions....................................65
Section 4.20 Limitation on Performance Guarantees.............................................65
Section 4.21 Payment of Additional Interest...................................................66
ARTICLE 5. SUCCESSORS...........................................................................66
Section 5.01 Merger, Consolidation, or Sale of Assets.........................................66
Section 5.02 Successor Corporation Substituted................................................67
ARTICLE 6. DEFAULTS AND REMEDIES................................................................68
Section 6.01 Events of Default................................................................68
Section 6.02 Acceleration.....................................................................70
Section 6.03 Other Remedies...................................................................71
Section 6.04 Waiver of Past Defaults..........................................................71
Section 6.05 Control by Majority..............................................................71
Section 6.06 Limitation on Suits..............................................................71
Section 6.07 Rights of Holders of Notes to Receive Payment....................................72
Section 6.08 Collection Suit by Trustee.......................................................72
Section 6.09 Trustee May File Proofs of Claim.................................................72
Section 6.10 Priorities.......................................................................73
Section 6.11 Undertaking for Costs............................................................73
ARTICLE 7. TRUSTEE..............................................................................74
Section 7.01 Duties of Trustee................................................................74
Section 7.02 Rights of Trustee................................................................75
Section 7.03 Individual Rights of Trustee.....................................................75
Section 7.04 Trustee's Disclaimer.............................................................75
Section 7.05 Notice of Defaults...............................................................76
Section 7.06 Reports by Trustee to Holders....................................................76
Section 7.07 Compensation and Indemnity.......................................................76
Section 7.08 Replacement of Trustee...........................................................77
Section 7.09 Successor Trustee by Xxxxxx, etc.................................................78
Section 7.10 Eligibility; Disqualification....................................................79
Section 7.11 Preferential Collection of Claims Against Company................................79
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE.............................................79
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.........................79
Section 8.02 Legal Defeasance and Discharge...................................................79
Section 8.03 Covenant Defeasance..............................................................80
Section 8.04 Conditions to Legal or Covenant Defeasance.......................................80
Section 8.05 Deposited Money and Government
Securities to be Held in Trust; Other
Miscellaneous Provisions.........................................................82
Section 8.06 Repayment to Company.............................................................82
Section 8.07 Reinstatement....................................................................83
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER.....................................................83
Section 9.01 Without Consent of Holders of Notes..............................................83
Section 9.02 With Consent of Holders of Notes.................................................84
Section 9.03 Compliance with Trust Indenture Act..............................................85
Section 9.04 Revocation and Effect of Consents................................................85
Section 9.05 Notation on or Exchange of Notes.................................................86
Section 9.06 Trustee to Sign Amendments, etc..................................................86
ARTICLE 10. COLLATERAL AND SECURITY..............................................................86
Section 10.01 Security Documents...............................................................86
Section 10.02 Recording and Opinions...........................................................87
Section 10.03 Release of Collateral/Additional Liens...........................................87
Section 10.04 Certificates and Opinions of Counsel.............................................90
Section 10.05 Certificates of the Trustee......................................................90
Section 10.06 Authorization of Actions to be Taken
by the Trustee Under the Security
Documents........................................................................91
Section 10.07 Authorization of Receipt of Funds by the
Trustee Under the Security
Documents........................................................................91
Section 10.08 Termination of Security Interest.................................................91
ARTICLE 11. NOTE GUARANTEES......................................................................92
Section 11.01 Guarantee........................................................................92
Section 11.02 Limitation on Guarantor Liability................................................93
Section 11.03 Execution and Delivery of Subsidiary Guarantees..................................93
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms...............................94
Section 11.05 Releases Following Sale of Assets................................................95
Section 11.06 Release Following Designation as an Unrestricted Subsidiary......................95
ARTICLE 12. SATISFACTION AND DISCHARGE...........................................................95
Section 12.01 Satisfaction and Discharge.......................................................95
Section 12.02 Application of Trust Money.......................................................96
ARTICLE 13. MISCELLANEOUS........................................................................97
Section 13.01 Trust Indenture Act Controls.....................................................97
Section 13.02 Notices..........................................................................97
Section 13.03 Communication by Holders of Notes with Other Holders of Notes....................98
Section 13.04 Certificate and Opinion as to Conditions Precedent...............................98
Section 13.05 Statements Required in Certificate or Opinion....................................98
Section 13.06 Rules by Trustee and Agents......................................................99
Section 13.07 No Personal Liability of Directors, Officers, Employees and Stockholders.........99
Section 13.08 Governing Law....................................................................99
Section 13.09 No Adverse Interpretation of Other Agreements....................................99
Section 13.10 Successors.......................................................................99
Section 13.11 Severability....................................................................100
Section 13.12 Counterpart Originals...........................................................100
Section 13.13 Table of Contents, Headings, etc................................................100
Schedule I Schedule of Guarantors..........................................................I-1
Exhibit A Form of Notes...................................................................A-1
Exhibit B Form of Notation of Guarantee...................................................B-1
Exhibit C Form of Supplemental Indenture to be Delivered by Subsequent Guarantors.........C-1
INDENTURE dated as of March [___], 2004 among Covanta Energy
Corporation, a Delaware corporation (the "Company"), the Guarantors (as defined)
and U.S. Bank National Association, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders (as
defined) of the 8.25% Senior Secured Notes due 2011 (the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
"Accreted Value" means, with respect to each $1,000 principal amount at
Stated Maturity of Notes, (i) as of the Issue Date, the Initial Principal
Amount; (ii) as of the Stated Maturity of the principal of the Notes, $1,000.00
and (iii) as of any other date of determination, the Initial Principal Amount
plus an accretion on such Initial Principal Amount equal to an amount that
causes the yield to maturity on such Note (taking into account the amount and
timing of all payments of stated interest at the Stated Maturity of such
payments, other than additional interest payable pursuant to Section 4.21, if
any) to equal 10.480002% per annum, calculated on a semi-annual bond equivalent
basis using a 360-day year comprised of twelve 30-day months and rounded to the
nearest $0.01.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such
specified Person, whether or not such Indebtedness is incurred in
connection with, or in contemplation of, such other Person merging with
or into, or becoming a Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset
acquired or owned by such specified Person.
"Adjusted EBITDA" means, for any period, for the Company and its
Consolidated Subsidiaries (i) without duplication, the aggregate amount derived
by combining the amounts for such period of (a) "Operating income (loss)", plus
(b) Net Depreciation and Amortization Expense, plus (c) "Amortization of premium
and discount, net", plus (d) "Unbilled receivables", to the extent associated
with accretion accounting for Limited Recourse Debt relating to Projects of the
Company and its Subsidiaries, minus (e) "Equity in income from unconsolidated
investments", minus (ii) without duplication, the aggregate amount derived by
combining the amounts (each expressed as a positive number) for such period of
(a) "Payment of debt", to the extent consisting of principal payments on Limited
Recourse Debt relating to Projects of the Company and its Subsidiaries, plus (b)
"Minority interests", plus (c) the change in Accreted Value of the Notes, as
each such line item referred to in clauses (i)(a), (i)(e) and (ii)(b) is
reflected in the Company's consolidated statement of income prepared in
conformity with GAAP and as each such line item referred to in clauses (i)(c),
(i)(d) and (ii) (a) is reflected in the Company's consolidated statement of cash
flows prepared in conformity with GAAP, in each case reported in a manner
consistent with the Company's reporting of such amount in its last quarterly or
annual report (as the case may be) on Form 10-Q or Form 10-K, respectively,
filed with the Commission prior to the Issue Date, whether such line items are
so titled or otherwise titled; provided, however, that, with respect to any such
period ending during 2008, each of the line items referred to above shall be
calculated as if the terms of the service agreement of the Company and its
Subsidiaries relating to the Alexandria Project in effect for fiscal year 2007
continued in effect during 2008, without giving effect to any negative impact on
Adjusted EBITDA from the terms of any extension in 2008 of such service
agreement.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.
"Approved DHC Investor" means any Person that acquires shares of common
stock of DHC pursuant to a transaction determined by at least a majority of the
members of the board of directors of DHC (who are not representatives, nominees
or Affiliates of such Person) to be in the best interests of DHC and its
stockholders.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any
assets, property or rights (other than the sale of Equity Interests of
the Company by the Company); provided that the sale, lease, conveyance
or other disposition of all or substantially all of the assets of the
Company and its Subsidiaries taken as a whole shall be governed by
Section 4.15 or Section 5.01 and not by Section 4.10; and
(2) the issuance of Equity Interests by any Restricted
Subsidiary of the Company or the sale of Equity Interests in any
Restricted Subsidiary of the Company.
Notwithstanding the preceding, none of the following items shall be
deemed to be an Asset Sale:
(1) any single transaction or series of related transactions
that involves assets, property or rights or the issuance of Equity
Interests having a fair market value, or yielding Net Proceeds, of less
than $10.0 million;
(2) any transfer of assets, property or rights by the Company
to a Restricted Subsidiary of the Company or by a Restricted Subsidiary
of the Company to the Company or another Restricted Subsidiary of the
Company;
(3) an issuance of Equity Interests by a Restricted Subsidiary
of the Company to the Company or a Restricted Subsidiary of the
Company;
(4) the sale, lease, sublease or assignment of equipment,
inventory, accounts receivable or other assets, property or rights in
the ordinary course of business;
(5) the disposition of equipment no longer used or useful in
the business of the Company or any of its Restricted Subsidiaries;
(6) a Sale/Leaseback Transaction with respect to any assets
within 90 days of the acquisition of such assets which complies with
the terms of this Indenture;
(7) the sale or other disposition of Cash Equivalents;
(8) the grant of any license of patents or trademarks or
registrations therefor and other similar intellectual property in the
ordinary course of business;
(9) the granting of any Permitted Lien (or the foreclosure
thereon);
(10) the surrender or waiver of contract rights or the
settlement, release or surrender of a contract, tort or other
litigation claim in the ordinary course of business;
(11) any sale of Indebtedness or other securities of an
Unrestricted Subsidiary of the Company;
(12) a Restricted Payment permitted to be made under Section
4.07 or a Permitted Investment; or
(13) any issuance of employee stock options or stock awards
pursuant to benefit plans in existence on the Issue Date.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate implicit in such transaction, determined in accordance with GAAP) of the
total obligations of the lessee for net rental payments during the remaining
term of the lease included in such Sale/Leaseback Transaction (including any
period for which such lease has been extended or may be, at the option of the
lessor, extended).
"Bank Indebtedness" means any and all amounts payable under or in
respect of the Credit Agreements and any Permitted Refinancing Indebtedness with
respect thereto, as amended from time to time, including principal, premium (if
any), interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company or any
Guarantor whether or not a claim for post-filing interest is allowed in such
proceedings), fees, charges, expenses, reimbursement obligations, guarantees and
all other amounts payable thereunder or in respect thereof.
"Bankruptcy Court" means the United States Bankruptcy Court for the
Southern District of New York [and any other court properly exercising
jurisdiction over any relevant case under Chapter 11 of the Bankruptcy Law.]
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Bankrupt Subsidiary" means any of Covanta Xxxxxx Energy Resource Co.
LP, a Delaware limited partnership, Covanta Lake II, Inc., a Florida
corporation, Covanta Tampa Construction, Inc., a Delaware corporation, Covanta
Tampa Bay, Inc., a Florida corporation, Covanta Xxxxxx Holdings I, Inc., a
Virginia corporation, or Covanta Xxxxxx Holdings II, Inc., a California
corporation, in each case so long as such Person remains subject to the Chapter
11 Cases before the Bankruptcy Court.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition. The terms
"Beneficially Own" and "Beneficially Owned" have corresponding meanings.
"Board of Directors" means the Board of Directors of the Company.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents
(however designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality of the United States government having maturities of
not more than one year from the date of acquisition;
(3) time deposits, demand deposits, certificates of deposit
and Eurodollar time deposits with maturities of one year or less from
the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case, with any
bank lender party to the First Lien Letter of Credit Facility or an
Affiliate thereof or with any domestic commercial bank having capital
and surplus in excess of $500.0 million and a Thomson Bank Watch Rating
of "B" or better;
(4) securities issued by any state of the United States or any
political subdivision of any such state 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 Xxxxx'x or S&P ;
(5) repurchase obligations with a term of not more than 30
days for underlying securities of the types described in clauses (2)
and (3) above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(6) commercial paper having one of the two highest ratings
obtainable from Xxxxx'x or S&P and in each case maturing within one
year after the date of acquisition; and
(7) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1)
through (6) of this definition.
"Cash Management System" means the cash management system of the
Company and its Subsidiaries as in effect on the Issue Date and any amendments,
modifications or extensions thereof on terms not materially less favorable to
the Company and its Restricted Subsidiaries, taken as a whole, than the terms of
such system as in effect on the Issue Date.
"Change of Control" means the occurrence of any of the following:
(1) any "person" (as such term is used in Section 13(d)(3) of
the Exchange Act), other than one or more Permitted Holders, becomes
the Beneficial Owner, directly or indirectly, of more than 50% of the
total voting power of the Voting Stock of the Company, whether as a
result of the issuance of securities of the Company, any merger,
consolidation, liquidation or dissolution of the Company, any direct or
indirect transfer of securities or otherwise; provided that the
creation of a holding company to own all of the Capital Stock of the
Company shall not be deemed to constitute a Change of Control under
this clause (1) if, immediately after consummation of such transaction,
the holders of the Capital Stock of such holding company are the same
holders of the Capital Stock of the Company immediately before such
transaction and the percentage holding of such holders is unaffected by
the creation of such holding company;
(2) the first day on which a majority of the members of the
Board of Directors are not Continuing Directors;
(3) the adoption of a plan relating to the liquidation or
dissolution of the Company, other than to effect a Change of Domicile;
or
(4) the sale, lease or transfer, other than by way of merger
or consolidation, in one or a series of related transactions, of all or
substantially all the assets of the Company and its Restricted
Subsidiaries taken as a whole to any "person" or "group" as that term
is used in Section 13(d)(3) of the Exchange Act (other than to the
Company, any Guarantor or one or more Permitted Holders or other than
to effect a Change of Domicile).
"Change of Domicile" means a transaction or series of related
transactions, including without limitation (1) a merger, amalgamation,
combination or consolidation of the Company with or into another Person, (2) the
acquisition of all the Capital Stock of the Company or (3) the sale, transfer,
conveyance or other disposition of all or substantially all the assets of the
Company and its Subsidiaries taken as a whole to another Person, the sole
purpose of which is to reincorporate the Company in another jurisdiction or
organize a successor entity to the Company in another jurisdiction.
"Chapter 11 Cases" means those bankruptcy cases jointly administered
under the caption "In re Xxxxx New York Services, Inc., et al.," Case Nos.
02-40826 (CB), et al.
"Clearstream" means Clearstream Banking, S.A.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means all property and assets of the Company or any
Guarantor with respect to which from time to time a Lien is granted as security
for the Notes pursuant to the applicable Security Documents.
"Collateral Agent" means Bank of America, N.A. in its capacity as the
"Collateral Agent" as appointed pursuant to the Security Documents and any
successor thereto in such capacity.
"Commission" means the Securities and Exchange Commission.
"Company" means Covanta Energy Corporation, a Delaware corporation, and
any and all successors thereto.
"Consolidated Cash Interest Expense" means, for any period, (i)
Consolidated Interest Expense for such period minus (ii) to the extent included
in Consolidated Interest Expense for such period, the change in Accreted Value
of the Notes, interest paid in kind and not in cash during such period and any
other amounts not paid or payable in cash.
"Consolidated Coverage Ratio" means, with respect to the Company and
its Consolidated Subsidiaries, as of any date of determination, the ratio of:
(1) the aggregate amount of Adjusted EBITDA for the period of
the most recent four consecutive fiscal quarters (commencing on or
after the Issue Date) for which internal financial statements are
available prior to the date of such determination to
(2) Consolidated Cash Interest Expense for such four fiscal
quarters; provided, however, that:
(A) if the Company or any of its Restricted
Subsidiaries has incurred any Indebtedness since the beginning
of such period that remains outstanding on such date of
determination or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio is an incurrence of
Indebtedness, Adjusted EBITDA and Consolidated Cash Interest
Expense for such period shall be calculated after giving
effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been incurred on the first day of such period
(in each case other than Indebtedness incurred under any
revolving credit facility, in which case interest expense
shall be computed based upon the average daily balance of such
Indebtedness during the applicable period) and the discharge
of any other Indebtedness repaid, repurchased, defeased
(whether legally or as to covenants only) or otherwise
discharged with the proceeds of such new Indebtedness as if
such discharge had occurred on the first day of such period;
(B) if the Company or any of its Restricted
Subsidiaries has repaid, repurchased, defeased or otherwise
discharged, including permanent reductions in letter of credit
commitments, any Indebtedness since the beginning of such
period or if any Indebtedness is to be repaid, repurchased,
defeased (whether legally or as to covenants only) or
otherwise discharged, including permanent reductions in letter
of credit commitments (in each case, if such Indebtedness has
been permanently repaid and has not been replaced, other than
Indebtedness incurred under any revolving credit facility
unless such Indebtedness is permanently reduced, in which case
interest expense shall be computed based upon the average
daily balance of such Indebtedness during the applicable
period) on the date of the transaction giving rise to the need
to calculate the Consolidated Coverage Ratio, Adjusted EBITDA
and Consolidated Cash Interest Expense for such period shall
be calculated on a pro forma basis as if such discharge had
occurred on the first day of such period and as if the Company
or such Restricted Subsidiary has not earned any interest
income actually earned during such period in respect of cash
or Cash Equivalents used to repay, repurchase, defease or
otherwise discharge such Indebtedness;
(C) if since the beginning of such period, the
Company or any of its Restricted Subsidiaries has made any
Asset Sale, Adjusted EBITDA for such period shall be reduced
by an amount equal to Adjusted EBITDA (if positive) directly
attributable to the assets that are the subject of such Asset
Sale for such period or increased by an amount equal to
Adjusted EBITDA (if negative) directly attributable thereto
for such period, and Consolidated Cash Interest Expense for
such period shall be reduced by an amount equal to the
Consolidated Cash Interest Expense directly attributable to
any Indebtedness of the Company or any Restricted Subsidiary
of the Company repaid, repurchased, defeased or otherwise
discharged with respect to the Company and its continuing
Restricted Subsidiaries in connection with such Asset Sale for
such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Cash Interest Expense for
such period directly attributable to the Indebtedness of such
Restricted Subsidiary to the extent the Company and its
continuing Restricted Subsidiaries are no longer liable for
such Indebtedness after such sale);
(D) if since the beginning of such period, the
Company or any of its Restricted Subsidiaries (by merger or
otherwise) has made an Investment in any Restricted Subsidiary
(or any Person that becomes a Restricted Subsidiary) or an
acquisition of assets, including any such Investment or
acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder, which
constitutes all or substantially all of an operating unit of a
business, Adjusted EBITDA and Consolidated Cash Interest
Expense for such period shall be calculated after giving pro
forma effect thereto (including the Incurrence of any
Indebtedness) as if such Investment or acquisition occurred on
the first day of such period; and
(E) if since the beginning of such period, any Person
(that subsequently became a Restricted Subsidiary of the
Company or was merged with or into the Company or any of its
Restricted Subsidiaries since the beginning of such period)
shall have made any Asset Sale or any Investment or
acquisition of assets that would have required an adjustment
pursuant to clause (C) or (D) above if made by the Company or
any of its Restricted Subsidiaries during such period,
Adjusted EBITDA and Consolidated Cash Interest Expense for
such period shall be calculated after giving pro forma effect
thereto as if such Asset Sale, Investment or acquisition of
assets occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be
given to an acquisition of assets, the amount of income or earnings relating
thereto and the amount of Consolidated Cash Interest Expense associated with any
Indebtedness incurred in connection therewith, the pro forma calculations shall
be determined in good faith by a responsible financial or accounting officer of
the Company. Any such pro forma calculations shall reflect any pro forma expense
and cost reductions attributable to such acquisitions, to the extent such
expense and cost reduction would be consistent with Regulation S-X, promulgated
under the Securities Act, as such regulation is in effect from time to time, and
permitted by the Commission to be reflected in pro forma financial statements
included in a registration statement filed with the Commission.
If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Hedging
Obligation applicable to such Indebtedness if such Hedging Obligation has a
remaining term as at the date of determination in excess of twelve months).
"Consolidated Interest Expense" means, for any period, (i) the total
interest expense, net of interest income, of the Company and its Consolidated
Subsidiaries, determined on a consolidated basis in accordance with GAAP, minus
(ii) interest expense incurred by the Company or its Consolidated Subsidiaries
in such period in connection with Indebtedness constituting Non-Recourse Debt or
Limited Recourse Debt, determined on a consolidated basis in accordance with
GAAP, plus (iii) to the extent incurred by the Company or its Consolidated
Subsidiaries in such period but not included in such interest expense, without
duplication, determined in each case on a consolidated basis in accordance with
GAAP, except to the extent related to Non-Recourse Debt and Limited Recourse
Debt:
(1) interest expense attributable to Capital Lease Obligations
and the imputed interest with respect to Attributable Debt;
(2) amortization of debt discount;
(3) amortization of debt issuance costs (other than any such
costs associated with the Indebtedness incurred by the Company or its
Subsidiaries in accordance with the Plan of Reorganization);
(4) amortization of capitalized interest;
(5) noncash interest expense;
(6) commissions, discounts and other fees and charges
attributable to letters of credit and bankers' acceptance financings;
(7) interest or dividends accrued and unpaid on any
Indebtedness of any other Person to the extent such Indebtedness is
Guaranteed by the Company or any Consolidated Subsidiary;
(8) net payments, if any, pursuant to Hedging Obligations
(including amortization of fees);
(9) dividends in respect of all Disqualified Stock of the
Company and all Preferred Stock of any of its Consolidated
Subsidiaries, to the extent held by Persons other than the Company or
another Consolidated Subsidiary; and
(10) cash contributions to any employee stock ownership
plan or similar trust to the extent such contributions are used by such plan or
trust to pay interest or fees to any Person (other than the Company) in
connection with Indebtedness incurred by such plan or trust.
"Consolidated Net Income" means, for any period, the net income or loss
of the Company and its Consolidated Subsidiaries for such period determined in
accordance with GAAP; provided, however, that:
(1) net income of any Person (other than the Company) which is
not a Restricted Subsidiary, shall be excluded from such Consolidated
Net Income, except that:
(A) subject to the limitations contained in clause
(4) below, the Company's equity in the net income of any such
Person for such period shall be included in such Consolidated
Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company
or a Restricted Subsidiary of the Company as a dividend or
other distribution (subject, in the case of a dividend or
other distribution made to a Restricted Subsidiary of the
Company, to the limitations contained in clause (2) below);
and
(B) the Company's equity in a net loss of any such
Person for such period shall be included in determining such
Consolidated Net Income;
(2) net income (or loss) of any Restricted Subsidiary of the
Company, other than a Guarantor, to the extent that the declaration or
payment of dividends or similar distributions by such Restricted
Subsidiary of that income is not at the date of determination permitted
without any prior governmental approval (that has not been obtained) or
is, directly or indirectly, restricted by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to such Restricted
Subsidiary or its stockholders or other holders of its equity, which
restrictions have not been legally and effectively waived, shall be
excluded from such Consolidated Net Income except that:
(A) subject to the limitations contained in clause
(4) below, the Company's equity in the net income of any such
Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of
cash actually distributed by such Restricted Subsidiary during
such period to the Company or another Restricted Subsidiary of
the Company as a dividend or other distribution (subject, in
the case of a dividend or other distribution made to another
Restricted Subsidiary of the Company, to the limitation
contained in this clause); and
(B) the Company's equity in a net loss of any such
Restricted Subsidiary for such period shall be included in
determining such Consolidated Net Income;
(3) any gain (or loss) realized upon the sale or other
disposition of any asset of the Company or any of its Restricted
Subsidiaries (including pursuant to any Sale/Leaseback Transaction)
that is not sold or otherwise disposed of in the ordinary course of
business and any gain (or loss) realized upon the sale or other
disposition of any Capital Stock of any Subsidiary of the Company shall
be excluded from such Consolidated Net Income (without regard to
abandonments or reserves relating thereto);
(4) amounts specified in clause (ii)(a) of the definition of
Adjusted EBITDA (determined in accordance with such definition) shall
be excluded from such Consolidated Net Income;
(5) any extraordinary gain or loss shall be excluded from such
Consolidated Net Income;
(6) the cumulative effect of a change in accounting principles
shall be excluded from such Consolidated Net Income;
(7) gains or losses due solely to fluctuations in currency
values and the related tax effects determined in accordance with GAAP
shall be excluded from such Consolidated Net Income;
(8) any non-cash deferred tax expense shall be excluded from
such Consolidated Net Income;
(9) Fresh Start Charges and reorganization charges taken in
connection with the Plan of Reorganization shall be excluded from such
Consolidated Net Income;
(10) amortization of debt issuance costs in respect of
Indebtedness incurred by the Company or its Subsidiaries in accordance
with the Plan of Reorganization shall be excluded from such
Consolidated Net Income;
(11) any charges resulting from the application of Statement
of Financial Accounting Standards No. 142 or 145 shall be excluded from
such Consolidated Net Income; and
(12) the results of operations of CPIH and its Subsidiaries
shall be excluded in determining such Consolidated Net Income.
"Consolidated Subsidiaries" means the Restricted Subsidiaries of the
Company; provided, however, that the interest of the Company or any of its
Restricted Subsidiaries in an Unrestricted Subsidiary shall be accounted for as
an Investment.
"Continuing Directors" means, as of any date of determination, those
members of the Board of Directors who: (a) were members of the Board of
Directors on the Issue Date; or (b) were nominated for election or elected to
the Board of Directors with the affirmative vote of, or whose election or
appointment was otherwise approved or ratified (whether before or after
nomination or election) by, at least a majority of the Continuing Directors who
were members of the Board of Directors at the time of the nomination, election
or approval, as applicable.
"Corporate Services Reimbursement Agreement" means the corporate
services and expense reimbursement agreement entered into by DHC and the Company
dated March [__], 2004 and any amendments, modifications or extensions thereof
on terms not materially less favorable to the Company and its Restricted
Subsidiaries, taken as a whole, than the terms of such agreement as in effect on
the Issue Date.
"Corporate Trust Office of the Trustee" will be at the address of the
Trustee specified in Section 13.02 or such other address as to which the Trustee
may give notice to the Company.
"CPIH" means Covanta Power International Holdings, Inc., a Delaware
corporation, and any and all successors thereto.
"CPIH Reimbursement Agreement" means the Management Services and
Reimbursement Agreement entered into by CPIH, the Company and certain of their
respective Subsidiaries on the Issue Date, as such agreement may be amended,
supplemented or otherwise modified from time to time.
"CPIH Subsidiaries" means, on and after the Issue Date, CPIH and its
Subsidiaries.
"Credit Agents" means, at any time, the Persons serving at such time as
the sole lender or as the "Agent," "Administrative Agent" or in some other
similar capacity under each of the Credit Agreements, respectively (each of them
being referred to individually herein as a "Credit Agent").
"Credit Agreements" means the First Lien Letter of Credit Facility and
the Second Lien Letter of Credit Facility (each being referred to individually
herein as a "Credit Agreement") and any other revolving credit or letter of
credit facility entered into by the Company or any of its Restricted
Subsidiaries.
"Credit Agreement Obligations" means (i) all Bank Indebtedness and (ii)
all other obligations (not constituting Indebtedness) of the Company or any
Guarantor under the Credit Agreements.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06, substantially in
the form of Exhibit A hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 as the
Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"DHC" means Xxxxxxxxx Holding Corporation, a Delaware corporation, and
any and all successors thereto.
"Discharge of Credit Agreement Obligations" means payment in full in
cash of the principal of and interest and premium, if any, on all Bank
Indebtedness, payment in full in cash of any other Credit Agreement Obligations
that are due and payable or otherwise accrued and owing at or prior to the time
such principal, interest and premium, if any, are paid and the termination of
all letter of credit commitments and other commitments thereunder.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of such Capital Stock),
or upon the happening of any event, matures, excluding any maturity as the
result of the redemption thereof at the option of the issuer thereof, or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the holder of such Capital Stock, in whole or in
part, on or prior to the date on which the Notes mature, except to the extent
that such Capital Stock is solely redeemable with, or solely exchangeable for,
any Capital Stock that is not Disqualified Stock; provided that only the portion
of the Capital Stock or other security which so matures, is mandatorily
redeemable or is so redeemable at the option of the holder prior to such date
shall be deemed to be Disqualified Stock; provided further that if such Capital
Stock or other security is issued to and held by any employee pursuant to any
plan program or arrangement or any plan for the benefit of employees of the
Company or its Subsidiaries or by any such plan to such employees, such Capital
Stock or other security shall not constitute Disqualified Stock solely because
it may be required to be repurchased by the Company or any of its Subsidiaries
in order to satisfy applicable statutory or regulatory obligations or as a
result of such employee's termination, death or disability. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of such Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an Asset Sale shall not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.07.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
that was formed under the laws of the United States or any state of the United
States or the District of Columbia.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Subsidiary" means any Domestic Subsidiary which is not a
"Borrower", and is not required to be a "Borrower", under either the First Lien
Letter of Credit Facility or the Second Lien Letter of Credit Facility, as such
term is defined in those agreements.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the Credit Agreements) in
existence on the Issue Date or otherwise issued in accordance with the Plan of
Reorganization.
"Existing IPP International Project Guaranties" means, collectively,
(i) the existing guaranty by Covanta Energy Group, Inc. of the obligations of
the CPIH Subsidiaries under certain agreements relating to the Haripur Project,
the Samalpatti Project and the Trezzo Project, (ii) the existing guaranty by
Covanta Projects, Inc. of the obligations of the CPIH Subsidiaries under certain
agreements relating to the Quezon Project and (iii) the existing guaranty by the
Company of the obligations of the CPIH Subsidiaries under certain agreements
relating to the Balaji/Madurai Project and the LICA Project, as each such
guaranty may be amended, restated, supplemented or otherwise modified on terms
not materially less favorable to the Company and its Restricted Subsidiaries,
taken as a whole, than the terms of such guaranty as in effect on the Issue
Date.
"Expansion" means, with respect to any waste-to-energy Project in
existence on the Issue Date, additions or improvements to the existing
facilities of such Project that involve the addition of a boiler or an increase
in turbine generating capacity.
"First Lien Letter of Credit Facility" means the Credit Agreement,
dated as of March [___], 2004, by and among the Company, the guarantors party
thereto, Deutsche Bank Securities, Inc., as documentation agent, Bank of
America, N.A., as administrative agent, and the lenders party thereto, including
any related notes, guarantees, collateral documents, instruments and agreements
executed in connection therewith, and in each case as amended (including any
amendment and restatement thereof), modified, renewed, increased, supplemented,
refunded, replaced or refinanced in whole or in part from time to time,
including any agreement extending the maturity of, consolidating or otherwise
restructuring (including adding subsidiaries of the Company as additional
guarantors thereunder) all or any portion of the Indebtedness under such
agreement or any successor or replacement agreement and whether by the same or
any other agent, lender or group.
"Fresh Start Charges" means, for any period, the aggregate non-cash
charges of the Company and its Restricted Subsidiaries arising from the
application of fresh start accounting principles, determined on a consolidated
basis in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, as in effect from time to time.
"Global Notes" means one or more global Notes registered in the name of
the Depositary or its nominee issued in accordance with Article 2, substantially
in the form of Exhibit A hereto, and bearing the Global Note Legend and
including the "Schedule of Exchanges of Interests in the Global Note" attached
thereto.
"Global Note Legend" means the legend set forth in Section 2.06(f),
which is required to be placed on all Global Notes issued under this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person:
(1) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Indebtedness of such other Person (whether
arising by virtue of partnership arrangements, or by agreement to
keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or
otherwise) or
(2) entered into for the purpose of assuring in any other
manner the obligee of such Indebtedness of the payment thereof or to
protect such obligee against loss in respect thereof (in whole or in
part);
provided, however, that the term "Guarantee" shall not include (i) endorsements
of negotiable instruments for collection or deposit in the ordinary course of
business or (ii) Performance Guarantees. The term "guarantee" used as a verb has
a corresponding meaning.
"Guarantors" means each of:
(1) the Company's Domestic Subsidiaries on the Issue Date
other than Excluded Subsidiaries; and
(2) any other Subsidiary of the Company that executes a
Subsidiary Guarantee in accordance with the provisions of this
Indenture;
and their respective successors and assigns.
"Haverhill Deferred PPA Income" means, for any period, all non-cash
income resulting from payments made in 1998 by the counterparty to the power
purchase agreement relating to the Haverhill Project in order to "buydown" its
obligations under such agreement, to the extent such non-cash income is included
in consolidated revenue or consolidated earnings of the Company and its
Subsidiaries during such period.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:
(1) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements;
(2) other agreements or arrangements designed to protect such
Person against fluctuations in currency exchange rates or interest
rates; and
(3) forward agreements or arrangements designed to hedge
against fluctuation in electricity rates pertaining to electricity
produced by a Project, so long as the contractual arrangements relating
to such Project contemplate that the Company or its Subsidiaries shall
deliver such electricity to third parties.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication) the following items if and to the extent
that any of them (other than items specified under clauses (3), (8) and (9)
below) would appear as a liability or, in the case of clause (6) only, Preferred
Stock on the balance sheet of such Person, prepared in accordance with GAAP:
(1) the principal amount of and premium, if any, in respect of
indebtedness of such Person for borrowed money;
(2) the principal amount of and premium, if any, in respect of
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(3) all obligations of such Person in respect of letters of
credit, bankers' acceptances, or other similar instruments (including
reimbursement obligations with respect thereto, but excluding
obligations in respect of letters of credit issued in respect of Trade
Payables);
(4) all obligations of such Person to pay the deferred and
unpaid purchase price of property or services (except Trade Payables),
which purchase price is due more than twelve months after the date of
placing such property in service or taking delivery and title thereto
or the completion of such services;
(5) all Capital Lease Obligations and all Attributable Debt of
such Person;
(6) the amount of all obligations of such Person with respect
to the redemption, repayment or repurchase of any Disqualified Stock
or, with respect to any Subsidiary of such Person, any Preferred Stock
(but excluding, in each case, any accrued dividends);
(7) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by
such Person; provided, however, that the amount of Indebtedness of such
Person shall be the lesser of:
(A) the fair market value of such asset at such date
of determination and
(B) the amount of such Indebtedness of such other
Persons;
(8) Hedging Obligations of such Person;
(9) all obligations of such Person in respect of Insurance
Premium Financing Arrangements; and
(10) all obligations of the type referred to in clauses (1)
through (9) of other Persons and all dividends or distributions of
other Persons for the payment of which, in either case, such Person is
responsible or liable, directly or indirectly, as obligor, guarantor or
otherwise, including by means of any Guarantee.
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 the maximum liability, upon the occurrence of the contingency giving
rise to the obligation, of any contingent obligations described above, at such
date; provided, however, that the amount outstanding at any time of any
Indebtedness issued with original issue discount shall be deemed to be the face
amount of such Indebtedness less the remaining unaccreted portion of the
original issue discount of such Indebtedness at such time, as determined in
accordance with GAAP.
"Indenture" means this indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Principal Amount" means, with respect to each $1,000 principal
amount at Stated Maturity of Notes, $891.30.
"Insurance Premium Financers" means Persons who are not Affiliates of
the Company who advance insurance premiums for the Company and its Subsidiaries
pursuant to Insurance Premium Financing Arrangements.
"Insurance Premium Financing Arrangements" means, with respect to any
Person, agreements with Insurance Premium Financers pursuant to which such
Insurance Premium Financers advance insurance premiums for or on behalf of such
Person. Insurance Premium Financing Arrangements (i) shall not provide, for the
benefit of such Insurance Premium Financers, any security interest in any
property of the Company or any of its Subsidiaries other than gross unearned
premiums for the insurance policies that are the subject of such arrangements,
(ii) shall not purport to prohibit any of the Liens created in favor of Trustee
for the benefit of Holders pursuant to the Security Documents, and (iii) shall
not contain any provision or contemplate any transaction prohibited by the
Indenture.
"Intercreditor Agreement" means that certain intercreditor agreement,
dated as of March [__], 2004, by and among the Company, the Company's
subsidiaries listed on the signature pages thereto, the financial institutions
listed on the signature pages thereto, Bank of America, N.A., as administration
agent, Deutsche Bank Securities, Inc., as documentation agent, DHC and the
Trustee, as amended (including any amendment and restatement thereof),
supplemented or otherwise modified from time to time.
"Interest Accrual Period" means the period from (and including) the
date of issuance of the Notes to but excluding the first Interest Payment Date
after issuance, and each successive six-month period from and including each
Interest Payment Date to but excluding the following Interest Payment Date.
"Interest Payment Date" means March 15 and September 15 of each year,
commencing on September 15, 2004, or if any such day is not a Business Day, the
next succeeding Business Day.
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the form
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or any Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer a Restricted Subsidiary of the Company, the Company shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Company's Investments in such Restricted Subsidiary
that were not sold or disposed of in an amount determined as provided in the
final paragraph of Section 4.07. Any deemed investment in any Person not
involving a transfer of cash or other assets to such Person and resulting solely
from the application of pushdown accounting rules shall not constitute an
Investment.
"Investor Parties" means (i) D.E. Shaw Laminar Portfolios, L.L.C., (ii)
SZ Investments, LLC, and (iii) Third Avenue Value Fund, Inc.
"Issue Date" means the first date on which the Notes are issued.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Limited Recourse Debt" means, with respect to any Subsidiary of the
Company, Indebtedness of such Subsidiary with respect to which the recourse of
the holder or obligee of such Indebtedness is limited to (i) assets associated
with a Project (which in any event shall not include assets held by the Company
or any Subsidiary other than a Subsidiary whose sole business is the ownership
and/or operation of such Project and substantially all of whose assets are
associated with such Project) in respect of which such Indebtedness was incurred
or (ii) the Equity Interests in such Subsidiary, but in the case of clause (ii)
only if such Subsidiary's sole business is the ownership and/or operation of
such Project and substantially all of such Subsidiary's assets are associated
with such Project. Indebtedness of a Subsidiary of the Company shall not fail to
be Limited Recourse Debt solely by virtue of the fact that the holders of such
Limited Recourse Debt have recourse to the Company or another Subsidiary of the
Company pursuant to a Performance Guaranty, so long as such Performance Guaranty
is not prohibited by Section 4.20.
"Management Investors" means the officers and employees of the Company
or a Subsidiary of the Company who acquire Voting Stock of DHC or the Company on
or after the Issue Date.
"Moody's" means Xxxxx'x Investors Service, Inc. or any successor to the
rating agency business of Xxxxx'x Investors Service, Inc.
"Mortgage" means a mortgage, deed of trust, assignment of leases and
rents, leasehold mortgage or other security document granting a Lien on any
parcel of real property to secure the Obligations under the Notes.
"Net Depreciation and Amortization Expense" means, for any period, (i)
the sum of the amounts (each expressed as a positive number) for such period of
"Depreciation" and "Amortization", as each such line item is reflected in the
Company's consolidated statement of cash flows prepared in conformity with GAAP
and reported in a manner consistent with the Company's reporting of such amount
in its last quarterly or annual report (as the case may be) on Form 10-Q or Form
10-K, respectively, filed with the Commission prior to the Issue Date, whether
such line items are so titled or otherwise titled, plus other non-cash charges,
minus (ii) Haverhill Deferred PPA Income.
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of (i) the costs
directly related to such Asset Sale, including, without limitation, legal,
accounting and investment banking fees, sales commissions and consent fees, (ii)
taxes paid or payable as a result of such Asset Sale, in each case, after taking
into account any available tax credits or deductions and any tax sharing
arrangements, (iii) amounts required to be applied to the repayment or cash
collateralization of Indebtedness secured by a Lien on the asset or assets that
were the subject of such Asset Sale, and (iv) any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company, any Guarantor, nor any
Restricted Subsidiary (i) provides credit support of any kind
(including any undertaking, agreement or instrument that would
constitute Indebtedness), (ii) is directly liable as a guarantor or
otherwise, or (iii) constitutes the lender; and
(2) no default with respect to which (including any rights
that the holders of the Indebtedness may have to take enforcement
action against an Unrestricted Subsidiary) would permit upon notice,
lapse of time or both any holder of any other Indebtedness (other than
the Notes) of the Company, any Guarantor, or any Restricted Subsidiary
to declare a default on such other Indebtedness or cause the payment of
such other Indebtedness to be accelerated or payable prior to its
stated maturity;
provided that Performance Guarantees permitted under this Indenture shall not
cause any such Indebtedness not to be Non-Recourse Debt.
"Notes" has the meaning assigned to it in the preamble to this
Indenture.
"Obligations" means all principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable
(including post-petition interest whether or not allowable as a claim in any
proceeding) under the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Financial Officer, the
Treasurer, any Senior Vice President, or any Vice President of such Person.
"Officer's Certificate" means a certificate signed on behalf of the
Company by an Officer of the Company that meets the requirements of Section
13.05.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee and, that meets the requirements of Section
13.05. Such counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Performance Guaranty" means any agreement entered into by the Company
or any Restricted Subsidiary of the Company under which the Company or such
Restricted Subsidiary (i) guarantees the performance of a Subsidiary of the
Company under a lease or sublease or under a service, management or operating
agreement relating to a Project or (ii) guarantees the performance of CPIH or
any of its Subsidiaries under a lease or sublease or under a service, management
or operating agreement in existence on the Issue Date, as amended or modified on
terms not materially less advantageous to the Company or such Restricted
Subsidiary.
"Permitted Business" means any business of the type engaged in by the
Company or any of its Restricted Subsidiaries as of the Issue Date or any
business reasonably related, ancillary or complementary thereto.
"Permitted Holders" means (i) DHC and the Management Investors and (ii)
any Related Party of a Person referred to in the immediately preceding clause
(i).
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary of the Company:
(1) in the Company, a Restricted Subsidiary of the Company
(other than a Bankrupt Subsidiary) or a Person that will, upon the
making of such Investment, become a Restricted Subsidiary of the
Company;
(2) consisting of intercompany loans to Bankrupt Subsidiaries,
so long as (a) the proceeds of such loans are applied to working
capital, maintenance, operation, payroll and other liquidity
requirements in the ordinary course of business of such Bankrupt
Subsidiaries, and (b) the aggregate amount of such intercompany loans
outstanding to all Bankrupt Subsidiaries at any time does not exceed
$3.0 million;
(3) in another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or
conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary of the Company;
(4) in Cash Equivalents;
(5) in receivables owing to the Company or any Restricted
Subsidiary of the Company if created or acquired in the ordinary course
of business and payable or dischargeable in accordance with customary
trade terms; provided that such trade terms may include such
concessionary trade terms as the Company or any such Restricted
Subsidiary deems reasonable under the circumstances;
(6) in payroll, travel and similar advances to employees to
cover matters that are expected at the time of such advances ultimately
to be treated as expenses for accounting purposes and that are made in
the ordinary course of business;
(7) in loans or advances to employees made in the ordinary
course of business and not exceeding $2.0 million in the aggregate
outstanding at any one time, of which not more than $1.0 million shall
be for purposes other than employee relocation expenses;
(8) received in settlement of debts created in the ordinary
course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments;
(9) in any Person to the extent such Investment represents the
non-cash portion of the consideration received for an Asset Sale that
was made pursuant to and in compliance with Section 4.10 or a
transaction not constituting an Asset Sale by reason of the $10.0
million threshold contained in the definition thereof;
(10) that constitutes a Hedging Obligation or commodity
hedging arrangement entered into for bona fide hedging purposes of the
Company in the ordinary course of business and otherwise in accordance
with this Indenture;
(11) in securities of any trade creditor, supplier or customer
received in settlement of obligations or pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency
of such trade creditor, supplier or customer;
(12) acquired as a result of a foreclosure with respect to any
secured Investment or other transfer of title with respect to any
secured Investment in default;
(13) consisting of purchases and acquisitions of inventory,
supplies, materials, equipment or contract rights or licenses or leases
of intellectual property, in any case, in the ordinary course of
business;
(14) consisting of intercompany Indebtedness not prohibited
under Section 4.09;
(15) consisting of a Guarantee not prohibited under Section
4.09;
(16) the consideration for which consists solely of shares of
Capital Stock (other than Disqualified Stock) of the Company;
(17) required to be made by the Company and its Restricted
Subsidiaries under Performance Guarantees in effect on the Issue Date
or entered into in compliance with the terms of Section 4.20;
(18) deemed to have been made as a result of the acquisition
of a Person that at the time of such acquisition held instruments
constituting Investments that were not made or acquired in
contemplation of such acquisition;
(19) in prepaid expenses and leases, and in utility and
workers' compensation performance and other similar deposits made in
ordinary course of business;
(20) in CPIH and its Subsidiaries and in Unrestricted
Subsidiaries of the Company to fund administrative services including,
but not limited to, payroll, cash management, administration, billing,
procurement, and equity investments the Company is required to make in
CPIH and its Subsidiaries in a net amount not to exceed $20.0 million
in the aggregate outstanding at any one time;
(21) under the CPIH Reimbursement Agreement or the Tax Sharing
Agreement;
(22) advances by the Company or a Restricted Subsidiary of the
Company to fund expansion, replacements or improvements in respect of a
publicly-owned Project, which advances are reimbursable by the owner of
the Project;
(23) made pursuant to the Plan of Reorganization; and
(24) other Investments having an aggregate fair market value
(measured on the date each such Investment was made and without giving
effect to subsequent changes in value) not exceeding $70.0 million in
the aggregate outstanding at any one time.
"Permitted Liens" means:
(1) Liens securing the Credit Agreement Obligations and
obligations to the cash management bank with respect to the Cash
Management System;
(2) Liens securing the Notes and the Subsidiary Guarantees;
(3) Liens in favor of the Company or any Guarantor;
(4) Liens on property or assets of a Person existing at the
time such Person is acquired by, merged with or into or consolidated
with the Company or any Restricted Subsidiary; provided that such Liens
were not put in place in contemplation of such acquisition, merger or
consolidation and do not extend to any assets other than those of the
Person acquired by, merged into or consolidated with the Company or the
Restricted Subsidiary;
(5) Liens on property or assets existing at the time of
acquisition of the property or assets by the Company or any Restricted
Subsidiary of the Company; provided that such Liens were not put in
place in contemplation of such acquisition;
(6) Liens existing on the Issue Date or otherwise granted to
secure Existing Indebtedness in accordance to the Plan of
Reorganization;
(7) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent, that are not yet subject to
penalties or interest for non-payment or that are being contested in
good faith by appropriate proceedings promptly instituted and
diligently concluded; provided that any reserve or other appropriate
provision as is required in conformity with GAAP has been made
therefor;
(8) Liens securing Permitted Refinancing Indebtedness where
the Liens securing Indebtedness being refinanced were permitted under
this Indenture;
(9) easements, rights-of-way, zoning and similar restrictions
and other similar encumbrances or title defects incurred or imposed, as
applicable, in the ordinary course of business;
(10) Liens securing Indebtedness permitted by clause (5) of
Section 4.09(b) covering only the assets acquired with such
Indebtedness;
(11) Liens with respect to Permitted Indebtedness incurred
pursuant to clause (8) or (10) of Section 4.09(b).
(12) Liens securing Hedging Obligations permitted under this
Indenture;
(13) Liens arising from the filing of Uniform Commercial Code
financing statements in connection with operating leases;
(14) attachment or judgment Liens not giving rise to an Event
of Default;
(15) Liens encumbering property or assets of the Company or
any Restricted Subsidiary of the Company consisting of carriers',
warehousemen's, mechanics', materialmen's, repairmen's, landlords',
suppliers' and other similar Liens, and other Liens arising by
operation of law and incurred in the ordinary course of business for
sums that are not overdue or that are being contested in good faith by
appropriate proceedings and (if so contested) for which appropriate
reserves with respect thereto have been established and maintained on
the books of the Company or such Restricted Subsidiary in accordance
with GAAP;
(16) Liens incurred, or pledges or deposits made in the
ordinary course of business and consistent with industry practice in
connection with, workers' compensation, unemployment insurance, or
other forms of governmental insurance or benefits, including any Liens
securing letters of credit issued in the ordinary course of business in
connection with the foregoing;
(17) Liens in the nature of rights of set-off of banks and
other Persons;
(18) Liens in favor of customs and revenue authorities and
other similar authorities to secure payment of customs duties in
connection with the importation of goods in the ordinary course of
business;
(19) leases or subleases granted to third Person not
materially interfering with the business of the Company and its
Restricted Subsidiaries taken as a whole;
(20) any interest or title of a lessor or lessee or sublessor
or sublessee under any operating lease;
(21) Liens under licensing agreements for use of intellectual
property entered into in the ordinary course of business;
(22) Liens incurred or deposits made in connection with the
purchase of inventory; provided that any such purchase of inventory is
incidental to the conduct of the business of the Company or a
Restricted Subsidiary of the Company in accordance with its then
current business practices, such Liens are in the nature of a vendor's
lien or a reservation of title and the obligations secured by such
Liens are Trade Payables incurred in the ordinary course of business of
the Company or such Restricted Subsidiary;
(23) minor imperfections of, or encumbrances on, title that do
not materially impair the value of property for its intended use;
(24) Liens incurred or deposits made to secure the performance
of tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, trade contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(25) Liens securing reimbursement obligations with respect to
letters of credit incurred in accordance with this Indenture that
encumber documents and other property relating to such letters of
credit and the products and proceeds thereof;
(26) Liens on assets of any Subsidiary of the Company or on
the Equity Interests of such Subsidiary, in each case to the extent
such Liens secure Limited Recourse Debt or Non-Recourse Debt of such
Subsidiary permitted by Section 4.09;
(27) Liens on cash collateral of the Company securing
insurance deductibles or self-insurance retentions required by third
party insurers in connection with insurance arrangements entered into
in the ordinary course of business by the Company and its Subsidiaries
with such insurers;
(28) Liens pursuant to Insurance Premium Financing
Arrangements permitted under this Indenture, so long as such Liens
attach only to the gross unearned premiums for the insurance policies
which are the subject of such arrangements; and
(29) Liens not otherwise permitted by clauses (1) through (28)
above securing Indebtedness in an aggregate amount at the time of
incurrence, together with all other Indebtedness secured by then
outstanding Liens previously incurred or assumed pursuant to this
clause (29), not in excess of $10.0 million.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries incurred or issued in exchange
for, or the net proceeds of which are used to extend, refinance, renew, replace,
defease or refund (A) other Indebtedness of the Company or any of its Restricted
Subsidiaries (other than intercompany Indebtedness); provided that:
(1) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal
amount (or accreted value, if applicable) of the Indebtedness extended,
refinanced, renewed, replaced, defeased (whether legally or as to
covenants only) or refunded (plus all accrued interest on such
Indebtedness and the amount of all fees, expenses and premiums incurred
in connection therewith); provided, however, that, notwithstanding the
foregoing, Permitted Refinancing Indebtedness with respect to Permitted
Debt described in clauses (3) and (4) of Section 4.09(b) may be
incurred in an amount not in excess of 110% of the principal amount of
the Indebtedness so extended, refinanced, renewed, replaced, defeased
or refunded (plus all accrued interest on such Indebtedness and the
amount of all fees, expenses and premiums incurred in connection
therewith);
(2) such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to
the Notes, such Permitted Refinancing Indebtedness has a final maturity
date later than the final maturity date of, and is subordinated in
right of payment to, the Notes on terms at least as favorable to the
Holders of Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and
(4) such Indebtedness is incurred either by the Company or by
the Restricted Subsidiary of the Company which is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
or (B) Limited Recourse Debt or Non-Recourse Debt of municipally-sponsored
privately-owned Projects so long as the terms of such Permitted Refinancing
Indebtedness, taken as a whole, are not materially more restrictive to the
Company and its Subsidiaries.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.
"Plan of Reorganization" means the Debtors' Second Joint Plan of
Reorganization under Chapter 11 of the Bankruptcy Code, as filed with the
Bankruptcy Court on January 14, 2004, together with the Reorganization Plan
Supplement to Debtors' Second Joint Plan of Reorganization filed with the
Bankruptcy Court on February 18, 2004 in connection therewith.
"Preferred Stock" as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) that is preferred as
to the payment of dividends, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such Person, over shares
of Capital Stock of any other class of such Person.
"Project" means any waste-to-energy facility, electrical generation
plant, cogeneration plant, water treatment facility or other facility for the
generation of electricity or engaged in another line of business in which the
Company and its Subsidiaries are permitted to be engaged hereunder for which a
Subsidiary or Subsidiaries of the Company was, is or will be (as the case may
be) an owner, operator, manager or builder, and shall also mean any two or more
of such plants or facilities in which an interest has been acquired in a single
transaction, so long as such interest constitutes an existing Investment on the
Issue Date permitted hereunder; provided however, that a Project shall cease to
be a Project at such time that the Company or any of its Subsidiaries ceases to
have any existing or future rights or obligations (whether direct or indirect,
contingent or matured) associated therewith.
"Related Party" means (a) with respect to DHC, (i) any direct or
indirect wholly-owned Subsidiary of DHC, any Approved DHC Investor and any
officer, director or employee of DHC or any wholly-owned Subsidiary of DHC, (ii)
any spouse or lineal descendant (including by adoption and stepchildren) of the
officers, directors and employees referred to in clause (a)(i) of this
definition or (iii) any trust, corporation or partnership 100%-in-interest of
the beneficiaries, stockholders or partners of which consists of one or more of
the persons described in clauses (a)(i) or (a)(ii) of this definition; or (b)
with respect to any Management Investor (i) any spouse or lineal descendant
(including by adoption and stepchildren) of such officer or employee or (ii) any
trust, corporation or partnership 100%-in-interest of the beneficiaries,
stockholders or partners of which consists of such officer or employee, any of
the persons described in clause (b)(i) of this definition or any combination
thereof.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee (or any successor group
of the Trustee) or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor to the rating agency business thereof.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired by the Company or a Restricted Subsidiary of the
Company whereby the Company or such Restricted Subsidiary transfers such
property to another Person and the Company or such Restricted Subsidiary leases
it from such Person, other than leases between the Company and a Guarantor or
between Guarantors.
"Second Lien Letter of Credit Facility" means (i) the Credit Agreement,
dated as of March [___], 2004, by and among the Company, each of its
Subsidiaries listed on the signature pages thereof, the financial institution
listed on the signature pages thereof and Bank One, N.A., as administrative
agent, including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, and in each case as
amended (including any amendment and restatement thereof), modified, renewed,
increased, supplemented, refunded, replaced or refinanced in whole or in part
from time to time, including any agreement extending the maturity of,
consolidating or otherwise restructuring (including adding subsidiaries of the
Company as additional guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Agreement" means the Security Agreement, dated as of the date
of this Indenture, by and among the Company, the Grantors (as defined therein)
and the Collateral Agent, as amended, modified or supplemented from time to time
in accordance with the terms of this Indenture.
"Security Documents" means the Security Agreement, the Intercreditor
Agreement and the Mortgages, dated as of the date of this Indenture, and any
other document or instrument pursuant to which a Lien is granted by the Company
or any Guarantor to secure any Obligations under the Notes and this Indenture or
under which rights or remedies with respect to such Lien are governed, as such
agreements may be amended, modified or supplemented from time to time.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the Issue Date.
"Stated Maturity" means, with respect to any installment of interest or
principal on any Indebtedness, the fixed date on which the payment of interest
or principal is scheduled to be paid in the documentation governing such
Indebtedness, but does not include any contingent obligations to repay, redeem
or repurchase any such interest or principal prior to the fixed date scheduled
for the payment thereof.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees of the
corporation, association or other business entity is at the time owned
or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and
(2) any partnership (i) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of
such Person or (ii) the only general partners of which are that Person
or one or more Subsidiaries of such Person (or any combination
thereof);
provided, however, that, except to the extent expressly indicated, the term
"Subsidiary," when used with respect to the Company or its Restricted
Subsidiaries, shall not include CPIH or any of its Subsidiaries.
"Subsidiary Guarantee" means, the Guarantee by each Guarantor of the
Company's Obligations under this Indenture and the Notes, executed pursuant to
the terms of this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"Tax Sharing Agreement" means the Tax Sharing Agreement among DHC, the
Company and CPIH and any amendments, modifications or extensions thereof on
terms not materially less favorable to the Company and its Restricted
Subsidiaries, taken as a whole, than the terms of such agreement as in effect on
the Issue Date.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Trustee" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
resolution of the Board of Directors, but only to the extent that such
Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are not materially less favorable to the Company or
such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company;
(3) is a Person with respect to which neither the Company nor
any of its Restricted Subsidiaries has any direct or indirect
obligation (i) to subscribe for additional Equity Interests or (ii) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results; and
(4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced by filing with the Trustee a certified copy of the
resolution of the Board of Directors giving effect to such designation and an
Officer's Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07. If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements to be an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09, the Company will be in default of
such covenant. The Board of Directors may at any time designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided that such designation shall
be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the
Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such
designation shall only be permitted if (1) such Indebtedness is permitted under
Section 4.09, calculated on a pro forma basis as if such designation had
occurred at the beginning of the four-quarter reference period; and (2) no
Default or Event of Default would be in existence following such designation.
"Unsecured Notes" means the 7.5% Subordinated Unsecured Notes due 2011
issued by the Company pursuant to an indenture dated March [___], 2004.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the board of
directors or comparable governing body of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (i) the
amount of each then remaining installment, sinking fund, serial
maturity or other required payments of principal, including payment at
final maturity, in respect of the Indebtedness, by (ii) the number of
years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment; by
(2) the then outstanding principal amount of such
Indebtedness.
Section 1.02 Other Definitions.
Term Defined in
---- Section
-------
"Affiliate Transaction"........................... 4.11
"Asset Sale Offer"................................ 3.09
"Authentication Order"............................ 2.02
"Change of Control Offer"......................... 4.15
"Change of Control Payment"....................... 4.15
"Change of Control Payment Date".................. 4.15
"Covenant Defeasance"............................. 8.03
"DTC"............................................. 2.03
"Event of Default"................................ 6.01
"Excess Proceeds"................................. 4.10
"Exemption" ...................................... 10.03
"incur"........................................... 4.09
"Legal Defeasance"................................ 8.02
"Offer Amount".................................... 3.09
"Offer Period".................................... 3.09
"Paying Agent".................................... 2.03
"Permitted Debt".................................. 4.09
"Purchase Date"................................... 3.09
"Registrar"....................................... 2.03
"Relevant Liabilities"............................ 10.07
"Restricted Payments"............................. 4.07
"Subject Property"................................ 10.03
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Subsidiary Guarantees means the Company
and the Guarantors, respectively, and any successor obligor upon the Notes and
the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule under
the TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular;
(5) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and transactions;
(7) references to sections of or rules under the Securities
Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the Commission from time to time; and
(8) references to "Sections" or "Articles" are to the portions
of this Indenture so designated.
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Notes shall be known and designated as the "8.25%
Senior Secured Notes Due 2011" of the Company. The Notes and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A
hereto. The Notes may have notations, legends or endorsements required by law,
stock exchange rule or usage. Each Note shall be dated the date of its
authentication. The Notes shall be in denominations of $1,000 and integral
multiples thereof and shall be initially issued only in global form.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture, and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) Global Notes. Notes issued in global form shall be substantially in
the form of Exhibit A attached hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form shall be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note shall represent such of the outstanding Notes as
shall be specified therein and shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and
that the aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby shall be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06.
(c) Book-Entry Provisions. Participants and Indirect Participants shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depositary or by the Trustee as the custodian for the
Depositary or under such Global Note, and the Depositary shall 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 the Depositary or impair, as between
the Depositary and its Participants or Indirect Participants, the Applicable
Procedures or the operation of customary practices of the Depositary governing
the exercise of the rights of a holder of a beneficial interest in any Global
Note.
Section 2.02 Execution and Authentication.
An Officer must sign the Notes for the Company and an Officer or
director of each Guarantor must sign such Guarantor's Subsidiary Guarantee, in
each case, by manual or facsimile signature. If an Officer or director whose
signature is on a Note or Subsidiary Guarantee no longer holds that office at
the time a Note or Subsidiary Guarantee is authenticated, the Note or Subsidiary
Guarantee shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual or
facsimile signature of the Trustee. The signature shall be conclusive evidence
that the Note has been authenticated under this Indenture. On the date of the
Indenture, the Trustee shall, upon receipt of a written order of the Company
signed by two Officers (an "Authentication Order"), authenticate the Notes for
$230.0 million in aggregate principal amount at Stated Maturity.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate the Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes. The Company initially
appoints the Trustee to act as the Registrar and Paying Agent and to act as
Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal of or premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no further
liability for the money. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
Section 2.05 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
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. Global Notes will be exchanged by the
Company for Definitive Notes only if:
(1) the Company delivers to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that it
is no longer a clearing agency registered under the Exchange Act and, in
either case, a successor Depositary is not appointed by the Company within
120 days after the date of such notice from the Depositary; or
(2) the Company in its sole discretion determines that the Global
Notes (in whole but not in part) should be exchanged for Definitive Notes
and delivers a written notice to such effect to the Trustee;
Upon the occurrence of either of the preceding events in (1) or (2)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.06 or Section 2.07 or 2.10, shall be authenticated
and delivered in the form of, and shall be, a Global Note. A Global Note may not
be exchanged for another Note other than as provided in this Section 2.06(a);
provided that, beneficial interests in a Global Note may be transferred and
exchanged as provided in Section 2.06(b), (c) or (f).
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Transfers of beneficial interests in
the Global Notes also shall require compliance with either subparagraph (1) or
(2) below, as applicable:
(1) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in the same
Global Note. No written orders or instructions shall be required to be
delivered to the Registrar to effect the transfers described in this
Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(1), the transferor of
such beneficial interest must deliver to the Registrar either:
(A) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to credit or cause
to be credited a beneficial interest in another Global Note in an
amount equal to the beneficial interest to be transferred or
exchanged; and
(ii) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant
account to be credited with such increase; or
(B) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged; and
(ii) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
Subject to Section 2.06(a), if any holder of a beneficial interest in a Global
Note proposes to exchange such beneficial interest for a Definitive Note or to
transfer such beneficial interest to a Person who takes delivery thereof in the
form of a Definitive Note, then, upon satisfaction of the conditions set forth
in Section 2.06(b)(2), the Trustee shall cause the aggregate principal amount of
the applicable Global Note to be reduced accordingly pursuant to Section
2.06(g), and the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Definitive Note in the
appropriate principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(1) shall be registered in
such name or names and in such authorized denomination or denominations as the
holder of such beneficial interest requests through instructions to the
Registrar from or through the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons in
whose names such Notes are so registered.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
A Holder of a Definitive Note may exchange such Note for a beneficial interest
in a Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Global Note at any
time. Upon receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Global Notes.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder must present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing.
(f) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR
DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (00 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("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 SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
(g) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11. At any
time prior to such cancellation, if any beneficial interest in a Global Note is
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note or for Definitive Notes,
the principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depositary at the direction of the Trustee to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a Person
who will take delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(h) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon receipt of an Authentication Order in accordance with
Section 2.02 or at the Registrar's request.
(2) No service charge will be made to a Holder of a Global Note or to
a Holder of a Definitive Note for any registration of transfer or exchange,
but the Company may require a Holder to pay a sum sufficient to pay all
transfer tax or similar governmental charges payable in connection
therewith (other than any such transfer taxes or similar governmental
charges payable upon exchange or transfer pursuant to Sections 2.10, 3.06,
3.09, 3.10, 4.10, 4.15 and 9.05). The Registrar shall not be required to
register the transfer of or exchange any Note selected for redemption in
whole or in part, except the unredeemed portion of any Note being redeemed
in part.
(3) All Global Notes and Definitive Notes issued upon any registration
of transfer or exchange of Global Notes or Definitive Notes shall be the
valid obligations of the Company, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Global Notes or Definitive
Notes surrendered upon such registration of transfer or exchange.
(4) The Company shall not be required:
(A) to issue, to register the transfer of or to exchange any
Notes (i) during a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption under Section
3.02 and ending at the close of business on the day of selection, or
(ii) during a period beginning at the opening of business 15 days
before any Interest Payment Date and ending at the closing of business
on such Interest Payment Date;
(B) to register the transfer of or to exchange any Note selected
for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part; or
(C) to register the transfer of or to exchange a Note between a
record date and the next succeeding Interest Payment Date.
(5) Prior to due presentment for the registration of a transfer of any
Note, the Trustee, any Agent and the Company may deem and treat the Person in
whose name any Note is registered as the absolute owner of such Note for the
purpose of receiving payment of principal of and interest on such Notes and for
all other purposes, and none of the Trustee, any Agent or the Company shall be
affected by notice to the contrary.
(6) The Trustee shall authenticate Global Notes and Definitive Notes in
accordance with the provisions of Section 2.02.
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note; provided that, Notes held by the Company or a Subsidiary of the
Company shall not be deemed to be outstanding for purposes of Section 3.07(a).
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser. If the principal amount or
Accreted Value of any Note is considered paid under Section 4.01, it ceases to
be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Affiliate of the Company, shall be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as may be reasonably acceptable to
the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of this
Indenture.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy or
return to the Company canceled Notes (subject to the record retention
requirement of the Exchange Act). Certification of the destruction of all
canceled Notes shall be delivered to the Company. The Company may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01. The Company shall notify the Trustee in writing of the
amount of defaulted interest proposed to be paid on each Note and the date of
the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date; provided that no such special record date
may be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07, it must furnish to the Trustee, at least
45 days but not more than 75 days before a redemption date, an Officer's
Certificate setting forth:
(1) the clause of this Indenture pursuant to which the redemption
shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
(a) If there is more than one Holder, and if less than all of the Notes
are to be redeemed or purchased in an offer to purchase at any time, the Trustee
shall select Notes for redemption or purchase as follows:
(1) if the Notes are listed on any national securities exchange, in
compliance with the requirements of the principal national securities
exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national securities exchange,
by lot.
(b) In the event of partial redemption or purchase by lot, the
particular Notes to be redeemed or purchased shall be selected, unless otherwise
provided herein, not less than 30 nor more than 60 days prior to the redemption
or purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase.
(c) The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption or purchase and, in the case of any Note selected
for partial redemption or purchase, the principal amount thereof to be redeemed
or purchased. Notes and portions of Notes selected shall be in amounts of $1,000
or whole multiples of $1,000; provided that if all of the Notes of a Holder are
to be redeemed or purchased, the entire outstanding amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except
as provided in the preceding sentence, provisions of this Indenture that apply
to Notes called for redemption or purchase also apply to portions of Notes
called for redemption or purchase.
Section 3.03 Notice of Redemption.
(a) Subject to the provisions of Sections 3.09 and 3.10, at least 30
days but not more than 60 days before a redemption date, the Company shall mail
or cause to be mailed, by first class mail, a notice of redemption to each
Holder whose Notes are to be redeemed at its registered address, except that
redemption notices may be mailed more than 60 days prior to a redemption date if
the notice is issued in connection with a defeasance of the Notes or a
satisfaction and discharge of this Indenture pursuant to Articles 8 or 12.
(b) The notice shall identify the Notes to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(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 upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued upon cancellation of the
original Note;
(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;
(6) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date;
(7) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
(c) At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company has delivered to the Trustee, at least 45 days prior to the redemption
date, an Officer's 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 notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional. If
the Company complies with the provisions of Article 3, on and after the
redemption or purchase date, interest shall cease to accrue on the Notes or the
portions of Notes called for redemption or purchase.
Section 3.05 Deposit of Redemption or Purchase Price.
(a) One Business Day prior to the redemption or purchase date, the
Company shall deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption or purchase price of and accrued interest on all Notes to
be redeemed or purchased on that date. The Trustee or the Paying Agent will
promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption or purchase price of, and accrued interest on, all Notes to be
redeemed or purchased.
(b) If a Note is redeemed or purchased on or after an interest record
date but on or prior to the related Interest Payment Date, then any accrued and
unpaid interest shall be paid to the Person in whose name such Note was
registered at the close of business on such record date. If any Note called for
redemption or purchase is not so paid upon surrender for redemption or purchase
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption or purchase
date until such principal is paid, and to the extent lawful on any interest not
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the
Company shall issue and, upon receipt of an Authentication Order, the Trustee
shall authenticate for the Holder at the expense of the Company a new Note equal
in principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) At any time after the Issue Date and on or before March 15, 2006,
the Company may on any one or more occasions redeem all or a part of the Notes,
upon not less than 30 nor more than 60 days' notice, at the Accreted Value on
the redemption date, plus accrued and unpaid interest to the redemption date.
(b) At any time after March 15, 2006, the Company may on any one or
more occasions redeem all or a part of the Notes, upon not less than 30 nor more
than 60 days' notice, at the redemption prices (expressed as percentages of
Accreted Value) set forth below, plus accrued and unpaid interest to the
redemption date, if redeemed during the twelve-month period beginning on March
15 of the years indicated below:
Year Percentage
---- ----------
2006.................................. 104.625%
2007.................................. 103.469%
2008.................................. 102.313%
2009.................................. 101.156%
2010 and thereafter................... 100.000%
(c) Any redemption pursuant to this Section 3.07 shall be made in
accordance with the provisions of Section 3.01 through 3.06. Any notice to the
Holders of Notes of a redemption pursuant to this Section 3.07 shall include the
appropriate calculation of the redemption price, but need not include the
redemption price itself. The actual redemption price, calculated as described
above, shall be set forth in an Officers' Certificate delivered to the Trustee
no later than two Business Days prior to the redemption date.
Section 3.08 Mandatory Redemption.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
(a) In the event that, pursuant to Section 4.10, the Company is
required to commence an offer to all Holders to purchase Notes (an "Asset Sale
Offer"), it shall follow the procedures specified below.
(b) Subject to the Intercreditor Agreement, the Asset Sale Offer shall
be made to all Holders and all holders of other Indebtedness that is pari passu
with the Notes containing provisions similar to those set forth in this
Indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets. The Asset Sale Offer shall remain open for a period of at least
20 Business Days following its commencement and not more than 30 Business Days,
except to the extent that a longer period is required by applicable law (the
"Offer Period"). No later than three Business Days after the termination of the
Offer Period (the "Purchase Date"), the Company shall apply all Excess Proceeds
(the "Offer Amount") to the purchase or redemption of Notes and such other pari
passu Indebtedness containing provisions similar to this Section 3.09 (on a pro
rata basis, if applicable) or, if less than the Offer Amount has been tendered,
all Notes and other Indebtedness tendered in response to the Asset Sale Offer.
Payment for any Notes so purchased shall be made in the same manner as interest
payments are made.
(c) If the Purchase Date is on or after an interest record date and on
or before the related Interest Payment Date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
(d) Upon the commencement of an Asset Sale Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The notice, which shall govern the terms of the Asset Sale Offer, shall
state:
(1) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 and the length of time the Asset Sale Offer will
remain open;
(2) the Offer Amount, the offer price and the Purchase Date;
(3) that any Note not tendered or accepted for payment shall continue
to accrue interest;
(4) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to accrue
interest after the Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may elect to have Notes purchased in integral multiples of
$1,000 of principal at Stated Maturity only;
(6) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a
Depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives,
not later than the 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 Xxxxxx is withdrawing his election to have such Note
purchased;
(8) that, if the aggregate purchase or redemption price of Notes and
other pari passu Indebtedness surrendered by Holders exceeds the Offer
Amount, the Company shall select the Notes and other pari passu
Indebtedness to be purchased or redeemed on a pro rata basis based on the
Accreted Value of Notes and principal of such other pari passu Indebtedness
surrendered (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000 of principal at
Stated Maturity, or integral multiples thereof, shall be purchased); and
(9) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount at Stated Maturity to that of
the unpurchased portion of the Notes surrendered (or transferred by
book-entry transfer).
(e) On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officer's Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.09. The Company, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted by
the Company for purchase, and the Company shall promptly issue a new Note, and
the Trustee, upon written request from the Company shall authenticate and mail
or deliver such new Note to such Holder, in a principal amount at Stated
Maturity equal to that of any unpurchased portion of the Note surrendered. Any
Note not so accepted shall be promptly mailed or delivered by the Company to the
Holder thereof. The Company shall publicly announce the results of the Asset
Sale Offer on the Purchase Date.
(f) Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made in accordance with the
provisions of Sections 3.01 through 3.06.
(g) Notwithstanding the foregoing, to the extent the Intercreditor
Agreement is in effect, any Asset Sale Offer shall be governed by the terms of
the Intercreditor Agreement to the extent that the applicable terms of this
Indenture are inconsistent therewith.
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal or Accreted
Value of, premium, if any, and interest on the Notes on the dates and in the
manner provided in the Notes and in this Indenture. Principal, Accreted Value,
premium, if any, and interest shall be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of
10:00 a.m. Eastern Time on the due date money deposited by or on behalf of the
Company in immediately available funds and designated for and sufficient to pay
all principal, Accreted Value, premium, if any, and interest then due. Payments
of Accreted Value of the Notes prior to the Stated Maturity of principal of the
Notes shall reduce proportionately, for purposes of calculation of interest
payable thereon and for future determinations of Accreted Value and principal
thereof, the principal amount at Stated Maturity of the Notes with respect to
which such payments of Accreted Value have been made.
Section 4.02 Maintenance of Office or Agency.
(a) The Company shall maintain in the Borough of Manhattan, the City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company fails to maintain any such required office or agency or fails
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
(b) The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
(c) The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
Section 4.03 Reports.
(a) Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, so long as
any Notes remain outstanding, the Company shall:
(1) provide the Trustee and the Holders with the annual, quarterly and
current reports as are required in such Sections 13 and 15(d) to be filed
by a United States corporation subject to such Sections in respect of debt
securities not listed on an exchange, within 15 days after the times
specified for the filing of the information, documents and reports under
such Sections; and
(2) to the extent permitted, file with the Commission the reports
referred to in clause (1) of this Section 4.03(a) within 15 days after the
times specified for such filings under the Exchange Act (whether or not
applicable to the Company).
(b) The quarterly and annual financial information required by Section
4.03(a) shall include a reasonably detailed presentation, either on the face of
the financial statements or in the footnotes thereto, and in Management's
Discussion and Analysis of Financial Condition and Results of Operations, of
condensed consolidating financial information with respect to the financial
condition and results of operations of the Company and its Subsidiaries
(excluding CPIH and its Subsidiaries) separate from the financial condition and
results of operations of the Company and all of its Subsidiaries (including, for
that purpose, CPIH and its Subsidiaries).
Section 4.04 Compliance Certificate.
(a) The Company and each Guarantor (to the extent that such Guarantor
is so required under the TIA) shall deliver to the Trustee, within 105 days
after the end of each fiscal year, an Officer's Certificate of the Company and
such Guarantor, respectively, stating that, in the course of performing his or
her duties as officers of the Company or such Guarantor, as applicable, a review
of the activities of the Company or such Guarantor and its Subsidiaries during
the preceding fiscal year has been made under the supervision of the signing
Officers, and further stating, as to each such Officer signing such certificate,
that to the best of his or her knowledge the Company or such Guarantor has kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event of
Default has occurred, describing all such Defaults or Events of Default of which
he or she may have knowledge and what action the Company or such Guarantor is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal or Accreted Value of, or interest or
premium, if any, on, the Notes are prohibited or if such event has occurred, a
description of the event and what action the Company or such Guarantor is taking
or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a)(1) shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in connection with their audit,
nothing has come to their attention that caused them to believe that, with
respect to financial and accounting matters, the Company failed to comply with
any provisions of Article 4 or Article 5 or, if any such event of noncompliance
has come to their attention, specifying the nature and period of existence
thereof, it being understood that their audit was not directed primarily toward
obtaining knowledge of such noncompliance and that such accountants shall not be
liable directly or indirectly to any Person for any failure to obtain knowledge
of any such noncompliance.
(c) So long as any of the Notes are outstanding, the Company shall
deliver to the Trustee, within five Business Days after the date on which any
Officer of the Company becomes aware of any Default or Event of Default, an
Officer's Certificate specifying such Default or Event of Default and what
action the Company is taking or proposes to take with respect thereto.
Section 4.05 Taxes.
The Company shall, and shall cause each of its Subsidiaries to, pay or
discharge or cause to be paid or discharged, prior to delinquency, all taxes,
assessments, and governmental charges levied or imposed upon its or such
Subsidiaries' income, profits or property, except such as are contested in good
faith and by appropriate proceedings or where stayed by the Bankruptcy Court or
other court of competent jurisdiction or where the failure to effect such
payment or discharge is not adverse in any material respect to the Holders of
the Notes.
Section 4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors covenant (to the extent that it
may lawfully do so) that they shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture or the
Security Documents; and the Company and each of the Guarantors (to the extent
that it may lawfully do so) hereby expressly waive all benefit or advantage of
any such law, and covenant that they shall not, by resort to any such law,
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 has been enacted.
Section 4.07 Restricted Payments.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any payment
in connection with any merger or consolidation involving the Company or any
of its Restricted Subsidiaries) or to the direct or indirect holders of the
Company's or any of its Restricted Subsidiaries' Equity Interests in their
capacity as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company and other than
dividends or distributions payable to the Company or a Guarantor or, in the
case of a Restricted Subsidiary that is not a Guarantor, to the Company or
any Restricted Subsidiary);
(2) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the Company or
any direct or indirect parent of the Company held by a Person other than
the Company or a Restricted Subsidiary of the Company;
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value, any Indebtedness that is
subordinated by its terms in right of payment to the Notes or the
Subsidiary Guarantees, except payments of interest or principal at the
Stated Maturity thereof; or
(4) make any Restricted Investment (all such payments and other
actions set forth in these clauses (1) through (4) being collectively
referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(5) no Default or Event of Default has occurred and is continuing or
would occur as a consequence of such Restricted Payment;
(6) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable four quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Consolidated Coverage Ratio test set forth in Section 4.09(a); and
(7) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Issue Date (excluding Restricted Payments permitted
by clauses (2), (3), (4), (5), (6), (7), (8), (9), (10), (11) (other than
payments with respect to Equity Interests of the Company or any of its
Restricted Subsidiaries), (12) and (13) of Section 4.07(b)), is less than
the sum, without duplication, of:
(A) 50% of the aggregate Consolidated Net Income of the Company
(or, in the event such Consolidated Net Income shall be a deficit,
minus 100% of such deficit) accrued for the period beginning on the
Issue Date and ending on the last day of the Company's most recent
fiscal quarter for which financial information is available to the
Company ending prior to the date of such proposed Restricted Payment,
taken as one accounting period, plus
(B) 100% of the aggregate net cash proceeds received by the
Company since the Issue Date (x) from the issue or sale of Equity
Interests of the Company (other than Disqualified Stock) or
Disqualified Stock or debt or other securities of the Company that
have been converted into or exchanged for such Equity Interests (other
than (i) Equity Interests (or Disqualified Stock or convertible or
exchangeable debt or other securities) sold to a Subsidiary of the
Company or any employee stock ownership plan or other trust
established by the Company or any of its Subsidiaries for the benefit
of its employees to the extent that the purchase by such plan or trust
is financed by Indebtedness of such plan or trust owed to the Company
or any of its Subsidiaries or Indebtedness Guaranteed by the Company
or any of its Subsidiaries, and (ii) Disqualified Stock or convertible
or exchangeable debt or other securities that have been converted into
or exchanged for Disqualified Stock), and (y) as capital contributions
from its shareholders, plus
(C) to the extent that any Unrestricted Subsidiary is
redesignated as a Restricted Subsidiary after the Issue Date, the fair
market value of such Subsidiary, as determined by the Board of
Directors, as of the date of such redesignation, plus
(D) the sum of (i) the aggregate amount in cash returned to the
Company or any of its Restricted Subsidiaries and (ii) the aggregate
principal amount of Indebtedness of the Company or any of its
Restricted Subsidiaries cancelled, in each case with respect to
Restricted Investments made after the Issue Date whether through
interest payments, principal payments, dividends, or other
distributions or the forgiveness or cancellation of Indebtedness, plus
(E) the net cash proceeds received by the Company or any of its
Restricted Subsidiaries from the disposition or sale (other than to a
Restricted Subsidiary), or liquidation, retirement or redemption of
all or any portion of Restricted Investments made after the Issue
Date, plus
(F) the net reduction in Investments in Unrestricted Subsidiaries
resulting from payments of dividends, repayments of the principal of
loans or advances or other transfers of assets from Unrestricted
Subsidiaries to the Company or any of its Restricted Subsidiaries,
plus
(G) in the event that the Company or any of its Restricted
Subsidiaries makes any Investment in a Person that, as a result of or
in connection with such Restricted Investment, becomes a Restricted
Subsidiary, an amount equal to such portion of the Company's or any of
its Restricted Subsidiaries' existing Investments in such Person that
was previously treated as a Restricted Payment.
(b) The provisions of Section 4.07(a) will not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration of the dividend, if at the date of declaration the dividend
payment would have complied with the provisions of this Indenture;
provided, however, that any such dividend will be included in the
calculation of the amount of Restricted Payments (without duplication for
declaration);
(2) the making of any Restricted Investment or the payment on or with
respect to or, the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company or any of its
Restricted Subsidiaries or of any Equity Interests of the Company in
exchange for, or out of the net cash proceeds of the substantially
concurrent sale of, Equity Interests of the Company (other than (i)
Disqualified Stock and (ii) Equity Interests issued or sold to a Restricted
Subsidiary of the Company or to any employee stock ownership plan or other
trust established by the Company or any of its Subsidiaries for the benefit
of its employees to the extent that the purchase by such plan or trust is
financed by Indebtedness of such plan or trust owed to the Company or any
of its Subsidiaries or Indebtedness Guaranteed by the Company or any of its
Subsidiaries) or out of the net cash proceeds of substantially concurrent
capital contributions made to the Company; provided that the amount of any
such net cash proceeds that are utilized for any such Restricted Investment
redemption, repurchase, retirement, defeasance or other acquisition will be
excluded from clause (7)(B) of Section 4.07(a);
(3) the defeasance (whether legally or as to covenants only),
redemption, repurchase or other acquisition of subordinated Indebtedness of
the Company or any of its Restricted Subsidiaries or Disqualified Stock of
the Company with the net cash proceeds from an incurrence of Permitted
Refinancing Indebtedness;
(4) the declaration and payment of any dividend by a Restricted
Subsidiary of the Company to the holders of such Restricted Subsidiary's
Equity Interests on a pro rata basis;
(5) the retirement of any shares of Disqualified Stock of the Company
by conversion into, or by exchange for, shares of Disqualified 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 Stock of the Company; provided that the Disqualified Stock
of the Company that replaces the retired shares of Disqualified Stock of
the Company shall not require the direct or indirect payment of any
liquidation preference earlier in time than the final stated maturity of
the retired shares of Disqualified Stock of the Company;
(6) payments required to be made or otherwise contemplated pursuant to
the Plan of Reorganization;
(7) payments required to be made pursuant to the CPIH Reimbursement
Agreement, the Corporate Services Reimbursement Agreement or the Tax
Sharing Agreement;
(8) payments in respect of the limited partnership interests in
Covanta Onondaga Limited Partnership and Covanta Huntington Limited
Partnership pursuant to the limited partnership agreements of such entities
as in effect on the Issue Date and as amended, modified or extended on
terms not materially less favorable to the Company and its Restricted
Subsidiaries, taken as a whole;
(9) repurchases of Equity Interests deemed to occur upon the exercise
of stock options if such Equity Interests represent a portion of the
exercise price thereof;
(10) payments in satisfaction of earn-out and deferred purchase price
obligations pursuant to agreements relating to the acquisition of any
Person which, following such acquisition, would be a Restricted Subsidiary
of the Company;
(11) any Restricted Payments made pursuant to any employee benefit
plan, arrangement or perquisite (including plans, arrangements or
perquisites for the benefit of directors) or employment agreements or other
compensation arrangements, in each case as approved by the Board of
Directors in its good faith judgment;
(12) the distribution, as a dividend or otherwise, of Equity Interests
of, or Indebtedness owed to the Company or a Restricted Subsidiary of the
Company by, any Unrestricted Subsidiary of the Company;
(13) payments or distributions to dissenting stockholders pursuant to
applicable law or pursuant to or in connection with a consolidation, merger
or transfer of assets that complies with Section 5.01;
(14) any purchase, redemption, retirement or other acquisition for
value of any subordinated Indebtedness pursuant to the provisions of such
Indebtedness relating to a change of control or sale of assets; provided
that the Company shall have complied with any requirement to make a Change
of Control Offer or Asset Sale Offer, as the case may be, in connection
with such change of control or sale of assets; and
(15) other Restricted Payments in an aggregate amount not to exceed
$10.0 million.
(c) The amount of all Restricted Payments (other than cash) shall be
the fair market value on the date of the Restricted Payment of the assets or
securities proposed to be transferred or issued by the Company or any Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued by this
covenant shall be determined, in good faith, by the Board of Directors. The
Board of Directors' determination must be based upon an opinion or appraisal
issued by an accounting, appraisal or investment banking firm of national
standing if the fair market value exceeds $15.0 million and if the Restricted
Payment is to be made to an Affiliate of the Company or to the holders of or in
respect of any Equity Interest. Not later than the date of making any Restricted
Payment having a fair market value exceeding $15.0 million, the Company shall
deliver to the Trustee an Officer's Certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by this Section 4.07(c) were computed, together with a copy of the
fairness opinion or appraisal required by this Indenture. In determining whether
any Restricted Payment is permitted by the covenant described above, the Company
may in its sole discretion allocate all or any portion of such Restricted
Payment among the categories described in the immediately preceding paragraph or
among such categories and the types of Restricted Payments described in the
first paragraph under the "Restricted Payments" heading above; provided that at
the time of such allocation, all such Restricted Payments, or allocated portions
thereof, would be permitted under the various provisions of the covenant
described above.
Section 4.08 Dividend and Other Payment Restrictions Affecting
Subsidiaries.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any encumbrance or restriction on the ability of any Restricted
Subsidiary to:
(1) pay dividends or make any other distributions on its Capital Stock
to the Company or any of its Restricted Subsidiaries, or with respect to
any other interest or participation in, or measured by, its profits, or pay
any Indebtedness owed to the Company or any of its Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(3) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries.
(b) The provisions of Section 4.08(a) shall not apply to encumbrances
or restrictions existing under or by reason of:
(1) agreements governing Existing Indebtedness, the Credit Agreements
or the Indemnification Agreement as in effect on the Issue Date and any
amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings of those agreements; provided that
the amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings are not materially
more restrictive, taken as a whole, with respect to such dividend and other
payment restrictions than those provisions contained in those agreements on
the Issue Date;
(2) this Indenture, the Notes, the Subsidiary Guarantees and the
Security Documents;
(3) applicable law, rule, regulation or order;
(4) any instrument governing Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries as in effect
at the time of such acquisition (except to the extent such Indebtedness or
Capital Stock was incurred or issued in connection with or in contemplation
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, so acquired; provided
that, in the case of Acquired Debt, such Indebtedness was permitted by the
terms of this Indenture to be incurred;
(5) customary non-assignment provisions in leases and other agreements
entered into in the ordinary course of business;
(6) Permitted Refinancing Indebtedness; provided that the restrictions
contained in the agreements governing such Permitted Refinancing
Indebtedness are materially not more restrictive, taken as a whole, with
respect to such dividend and other payment restrictions than those
contained in the agreements governing the Indebtedness being refinanced;
(7) provisions with respect to the disposition or distribution of
assets or property held under joint venture agreements, or subject to asset
sale agreements, stock sale agreements and other similar agreements;
(8) restrictions on cash or other deposits or net worth requirements
imposed by customers under contracts or net worth requirements contained in
leases and other agreements entered into in the ordinary course of
business;
(9) customary restrictions with respect to Restricted Subsidiaries of
the Company pursuant to agreements creating Permitted Liens or agreements
entered into for the sale or disposition of all or substantially all of the
Capital Stock or assets of any such Restricted Subsidiary pending the
closing of such sale or disposition; provided that such restrictions apply
solely to the Capital Stock or assets of the Restricted Subsidiary that are
being sold or that are subject to the Permitted Lien;
(10) any encumbrance or restriction existing under or by reason of
Insurance Premium Financing Arrangements permitted pursuant to Section
4.09;
(11) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions on that property of the nature
described in clause (3) of the preceding paragraph;
(12) Liens securing Indebtedness otherwise permitted to be incurred
pursuant to Section 4.12 that limit the right of the debtor to dispose of
the assets subject to such Liens;
(13) Non-Recourse Debt, Limited Recourse Debt, or leases or operating
agreements related to Projects, so long as such encumbrances or
restrictions relate solely to Project assets and distributions of Project
earnings or Project cash flow;
(14) any instrument governing any other Indebtedness the incurrence of
which is not prohibited by Section 4.09; provided that the terms of such
Indebtedness are not materially more restrictive, taken as a whole, with
respect to such dividend and other payment restrictions than the provisions
with respect to such dividend and other payment restrictions contained in
this Indenture at the time of such incurrence; and
(15) any encumbrance or restriction of the type referred to in Section
4.08(a) imposed by any extension, amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing of an
agreement, contract, instrument or obligation referred to in clauses (1)
through (14) of this Section 4.08(b) that is not materially more
restrictive, taken as a whole, than the encumbrance or restriction imposed
by the applicable predecessor agreement, contract, instrument or
obligation.
Section 4.09 Restrictions on Indebtedness.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt); provided,
however, that the Company or any Guarantor may incur Indebtedness (including
Acquired Debt), and any Restricted Subsidiary of the Company (other than a
Bankrupt Subsidiary) may incur Acquired Debt not incurred by the acquired Person
in contemplation of the related acquisition of such Person by such Restricted
Subsidiary, if the Company's Consolidated Coverage Ratio at the time of
incurrence of such Indebtedness, after giving pro forma effect to such
incurrence or issuance as of such date and to the use of proceeds therefrom, as
if the same had occurred at the beginning of the most recently ended four fiscal
quarter period of the Company (commencing on or after the Issue Date) for which
internal financial statements are available, would have been no less than 2.00
to 1.00.
(b) Section 4.09(a) will not prohibit the incurrence of any of the
following items of Indebtedness (collectively, "Permitted Debt"):
(1) the incurrence by the Company or any Restricted Subsidiary of
Indebtedness and letters of credit under the Credit Agreements in an
aggregate principal amount at any one time outstanding (with letters of
credit being deemed to have a principal amount equal to the maximum
potential liability of the Company and its Restricted Subsidiaries
thereunder) not to exceed $280.0 million, less the aggregate amount of all
Net Proceeds of Asset Sales applied to repay Indebtedness under the Credit
Agreements in order to comply with Section 4.10(b);
(2) the incurrence by the Company of Indebtedness consisting solely of
its obligations under Insurance Premium Financing Arrangements, which
obligations shall not exceed at any time $30.0 million in the aggregate;
(3) the incurrence by the Company and its Restricted Subsidiaries of
the Existing Indebtedness, including without limitation the Unsecured
Notes;
(4) the incurrence by the Company and the Guarantors of Indebtedness
represented by the Notes and the related Subsidiary Guarantees to be issued
on the Issue Date;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations incurred for the purpose
of financing all or any part of the purchase price or cost of construction
or improvement of property, plant or equipment used in a Permitted Business
in an aggregate principal amount, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause (5), not to exceed $15.0 million at any
time outstanding;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
net proceeds of which are used to refund, refinance, defease or replace,
Indebtedness (other than intercompany Indebtedness) that was permitted by
this Indenture to be incurred under Section 4.09(a) or any of clauses (3),
(4), (5), (6), (9), (15), (16) or (18) of this paragraph;
(7) the incurrence (i) by the Company or any of the Guarantors of
intercompany Indebtedness between or among the Company and any of the
Guarantors and (ii) by non-Guarantor Restricted Subsidiaries of the Company
of Indebtedness to the Company or a Guarantor in an aggregate net amount
not to exceed $20.0 million; provided, however, that (a) if the Company or
any Guarantor is the obligor on such Indebtedness, such Indebtedness must
be unsecured and expressly subordinated to the prior payment in full in
cash of all obligations with respect to the Notes (in the case of the
Company) or the related Subsidiary Guarantee (in the case of a Guarantor);
and (b) any subsequent issuance or transfer of Equity Interests that
results in any such Indebtedness being held by a Person other than the
Company or a Guarantor and any sale or other transfer of any such
Indebtedness to a Person that is not either the Company or a Guarantor will
be deemed, in each case, to constitute an incurrence of such Indebtedness
by the Company or such Guarantor, as the case may be, that was not
permitted by this clause (7);
(8) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred for the bona fide
purpose of hedging (w) interest rate risk with respect to Indebtedness of
the Company or any of its Restricted Subsidiaries permitted to be incurred
under this Indenture and which has a notional amount no greater than the
payments due with respect to the Indebtedness being hedged thereby, or (x)
currency exchange rate risk in connection with then existing financial
obligations, or (y) the acquisition of goods or services or (z) against
fluctuations in electricity rates pertaining to electricity produced by a
Project; and in no event for purposes of speculation;
(9) Guarantees provided under Section 4.17 and the Guarantees by the
Company or any Restricted Subsidiary of Indebtedness of the Company or a
Restricted Subsidiary that was permitted to be incurred by another
provision of this Section 4.09;
(10) (A) Indebtedness incurred in the ordinary course of business
solely in respect of bid, surety and similar bonds and standby letters of
credit issued for the purpose of supporting workers' compensation
liabilities or other insurance obligations of the Company or any of its
Restricted Subsidiaries, to the extent that such incurrence does not result
in the incurrence of any obligation for the payment of borrowed money to
others and (B) Indebtedness owed to, including obligations in respect of
letters of credit for the benefit of, any Person in connection with
workers' compensation, health, disability or other employee benefits or
property, casualty or liability insurance provided by such Person to the
Company or a Restricted Subsidiary of the Company, pursuant to
reimbursement or indemnification obligations to such Person, in each case
incurred in the ordinary course of business;
(11) obligations in respect of Performance Guarantees entered into in
accordance with Section 4.20;
(12) obligations in respect of any Existing IPP International Project
Guaranties;
(13) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
drawn against insufficient funds in the ordinary course of business, and
such Indebtedness is extinguished within five business days after
incurrence thereof;
(14) Indebtedness arising from agreements of the Company or any of its
Restricted Subsidiaries providing for indemnification, adjustment of
purchase price, earn-out or other similar obligations, in each case,
incurred or assumed in connection with the disposition of any business or
assets or a Subsidiary of the Company;
(15) Indebtedness of the Company or any of its Restricted
Subsidiaries, to the extent the net proceeds thereof are promptly (a) used
to purchase Notes tendered pursuant to a Change of Control Offer under
Section 4.15 or (b) deposited to defease the Notes in accordance with
Article 8;
(16) the incurrence by the Company or any of its Restricted
Subsidiaries of Non-Recourse Debt or Limited Recourse Debt, in an aggregate
amount not to exceed the greater of (i) $40.0 million and (ii) 33% of the
aggregate reduction in principal amount of Non-Recourse Debt and Limited
Recourse Debt in existence on the Issue Date, up to a maximum amount of
$150.0 million, at any time outstanding;
(17) the incurrence by any Restricted Subsidiary of the Company of
Limited Recourse Debt relating to waste-to-energy Projects, so long as the
incurrence by such Restricted Subsidiary of such Limited Recourse Debt is
required, as evidenced by a resolution of the Board of Directors, by the
existing client (if such client is a governmental authority) of the
relevant Project; provided that during the continuance of an Event of
Default, the Company and its Restricted Subsidiaries shall not enter into
any new commitments for any such Indebtedness;
(18) Non-Recourse Debt or Limited Recourse Debt incurred by any of the
Company's Restricted Subsidiaries, the net proceeds of which are used to
repay, redeem or repurchase the Notes or any other secured unsubordinated
Indebtedness of the Company; and
(19) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount
(or accreted value, as applicable) at any time outstanding, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace
any Indebtedness incurred pursuant to this clause (19), not to exceed $30.0
million at any time outstanding.
(c) For purposes of determining compliance with this Section 4.09, in
the event that an item of proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in clause (1) through (19) of
Section 4.09(b), or is permitted to be incurred pursuant to Section 4.09(a), the
Company will be permitted to classify such item of Indebtedness on the date of
its incurrence, or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this Section 4.09. The maximum
amount of Indebtedness that the Company or any of its Restricted Subsidiaries
may incur pursuant to this covenant shall not be deemed to be exceeded solely as
a result of fluctuations in currency exchange rates. Indebtedness under the
Credit Agreements, including Guarantees of such Indebtedness, on the Issue Date
will be deemed to have been incurred on such date in reliance on the exception
provided by clause (1) of Section 4.09(b).
(d) Accrual of interest or dividends, the accretion of accreted value
or original issue discount and the payment of interest or dividends in the form
of additional Indebtedness will not be deemed to be an incurrence of
Indebtedness for purposes of this Section 4.09.
(e) For purposes of determining compliance with any U.S.
dollar-denominated restriction on Indebtedness, the U.S. dollar-equivalent
principal amount of Indebtedness denominated in a foreign currency will be
calculated based on the relevant currency exchange rate in effect on the date
such Indebtedness was incurred, in the case of term debt, or first committed, in
the case of revolving credit debt; provided that (1) the U.S. dollar-equivalent
principal amount of any such Indebtedness outstanding or committed on the Issue
Date will be calculated based on the relevant currency exchange rate in effect
on the Issue Date of this Indenture, and (2) if such Indebtedness is incurred to
refinance other Indebtedness denominated in a foreign currency, and such
refinancing would cause the applicable U.S. dollar-denominated restriction to be
exceeded if calculated at the relevant currency exchange rate in effect on the
date of such refinancing, such U.S. dollar-denominated restriction shall be
deemed not to have been exceeded so long as the principal amount of such
Refinancing Indebtedness does not exceed the principal amount of such
Indebtedness being refinanced. The principal amount of any Indebtedness incurred
to refinance other Indebtedness, if incurred in a different currency than the
Indebtedness being refinanced, shall be calculated based on the currency
exchange rate applicable to the currencies in which such respective Indebtedness
is denominated that is in effect on the date of such refinancing.
Section 4.10 Asset Sales.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company (or such Restricted Subsidiary, as the case may be)
receives consideration at the time of the Asset Sale at least equal to the
fair market value of the assets or Equity Interests issued or sold or
otherwise disposed of;
(2) the fair market value is determined by the Board of Directors and
evidenced by a resolution of the Board of Directors and, if such fair
market value is in excess of $15.0 million, is set forth in an Officer's
Certificate delivered to the Trustee; and
(3) at least 75% of the consideration received in the Asset Sale by
the Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents. For purposes of this clause (3), each of the following shall
be deemed to be cash:
(A) any liabilities, as shown on the Company's most recent
consolidated balance sheet, of the Company or any of its Restricted
Subsidiaries (other than contingent liabilities and liabilities that
are by their terms subordinated in right of payment to the Notes or
any Subsidiary Guarantee) that are assumed by the transferee of any
such assets pursuant to a customary novation agreement that releases
the Company or such Restricted Subsidiary from further liability;
(B) any securities, notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee
converted by the Company or such Restricted Subsidiary within 90 days
into cash or Cash Equivalents, to the extent of the cash and Cash
Equivalents received in that conversion; and
(C) any Voting Stock or assets of the kind referred to in clause
(2) or (4) of Section 4.10(b).
(b) Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company or such Restricted Subsidiary may, at its option and to the
extent it elects, apply (i) 33% of all such Net Proceeds received after the
Issue Date and until the aggregate Net Proceeds received by the Company and all
of its Restricted Subsidiaries equal $7.5 million, and (ii) thereafter, 100% of
such Net Proceeds:
(1) to repay or cash collateralize Bank Indebtedness and, to the
extent the Bank Indebtedness repaid is revolving credit Indebtedness, to
correspondingly reduce commitments with respect thereto;
(2) to acquire all or substantially all of the assets of, or a
majority of the Voting Stock of, a Permitted Business, or to make a
Permitted Investment in another Person that is engaged in a Permitted
Business;
(3) to make capital expenditures that are used or useful in a
Permitted Business;
(4) to acquire other assets that are used or useful in a Permitted
Business; or
(5) any combination of the foregoing;
provided that the Company and any such Restricted Subsidiary will be deemed to
have applied such Net Proceeds in accordance with clause (2) or clause (4) of
this Section 4.10(b) if, within 365 days after the date of such Asset Sale, the
Company or such Restricted Subsidiary shall have entered into, and not abandoned
or rejected, a binding agreement with respect to an acquisition, expenditure or
Investment that would result in such application of such Net Proceeds and that
acquisition, expenditure or Investment is thereafter completed within 455 days
after the date of such Asset Sale.
(c) Pending the final application of any Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.
(d) Any Net Proceeds from Asset Sales that are not applied or invested
as provided in Section 4.10(b), other than Net Proceeds not required to be
applied or invested in the manner specified in Section 4.10(b), shall constitute
"Excess Proceeds". When the aggregate amount of Excess Proceeds exceeds $15.0
million, the Company shall , to the extent permitted under the Intercreditor
Agreement, make an Asset Sale Offer to all Holders of Notes and to all holders
of other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in this Indenture with respect to offers to purchase
or redeem with the proceeds of sales of assets to purchase or redeem the maximum
principal amount of the Notes and such other pari passu Indebtedness that may be
purchased or redeemed out of the Excess Proceeds. The offer price for the Notes
in any Asset Sale Offer will be equal to 100% of the Accreted Value plus accrued
and unpaid interest on the Notes to be purchased, to the date fixed for the
closing of such Asset Sale Offer in accordance with the procedures set forth in
this Indenture, and shall be payable in cash. If the date of purchase is on or
after an interest record date and on or before the related Interest Payment
Date, accrued and unpaid interest, if any, shall be paid to the Holder in whose
name a Note is registered at the close of business on such record date, and no
additional interest shall be payable to Holders who tender pursuant to the Asset
Sale Offer. If any Excess Proceeds remain after consummation of an Asset Sale
Offer, the Company and its Restricted Subsidiaries may use those Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
Accreted Value of Notes and the amount of other pari passu Indebtedness tendered
into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other pari passu Indebtedness to be purchased or
redeemed on a pro rata basis. Upon completion of each Asset Sale Offer, the
amount of Excess Proceeds will be reset at zero.
(e) The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with Section 3.09 or
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
Section 3.09 or this Section 4.10 by virtue of such conflict.
(f) Notwithstanding the foregoing, to the extent the Intercreditor
Agreement is in effect, any Asset Sale shall be governed by the terms of the
Intercreditor Agreement to the extent that the applicable terms of this
Indenture are inconsistent therewith.
Section 4.11 Transactions with Affiliates.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any payment to, or sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any of its Affiliates (each, an "Affiliate Transaction"), unless:
(1) the Affiliate Transaction is on terms that are no less favorable
to the Company or such Restricted Subsidiary than those that would have
been obtained in a comparable transaction by the Company or such Restricted
Subsidiary with an unrelated Person; and
(2) the Company delivers to the Trustee:
(A) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $5.0 million, a resolution of the Board of Directors set
forth in an Officer's Certificate certifying that such Affiliate
Transaction complies with this Section 4.11 and that such Affiliate
Transaction has been approved by a majority of the members of the
Board of Directors having no personal stake in such Affiliate
Transaction; and
(B) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $15.0 million, an opinion as to the fairness to the Company
and its Restricted Subsidiaries of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or
investment banking firm of national standing.
(b) The following transactions will not be deemed to be Affiliate
Transactions and therefore will not be subject to the provisions of Section
4.11(a):
(1) any Restricted Payment permitted to be made pursuant to Section
4.07 and any Permitted Investment;
(2) payments made pursuant to the CPIH Reimbursement Agreement, the
Corporate Services Reimbursement Agreement or the Tax Sharing Agreement;
(3) any employment, service or termination agreement entered into in
the ordinary course of business;
(4) any issuance of Equity Interests (other than Disqualified Stock),
or other payments, awards or grants in cash, Equity Interests (other than
Disqualified Stock) or otherwise pursuant to, or the funding of, employment
arrangements, employee stock options and employee stock ownership plans
approved by the Board of Directors;
(5) loans or advances to employees of the Company or its Subsidiaries
in the ordinary course of business permitted by clause (7) of the
definition of Permitted Investments;
(6) the payment or provision of reasonable fees, compensation or
employee benefit plans, arrangements or perquisites to, and any indemnity
provided for the benefit of, directors, officers, consultants or employees
of the Company or any Subsidiary in the ordinary course of business;
(7) any transaction between or among the Company and its Restricted
Subsidiaries or between Restricted Subsidiaries of the Company;
(8) transactions with customers, suppliers, contractors, joint venture
partners or purchasers or sellers of goods or services, in each case which
are in the ordinary course of business (including, without limitation,
pursuant to joint venture agreements) and otherwise in compliance with the
terms of this Indenture, and which are fair to the Company and its
Restricted Subsidiaries, as applicable, in the reasonable determination of
the Board of Directors;
(9) transactions with the Investor Parties pursuant to the
Indemnification Agreement, the Second Lien Letter of Credit Facility and
any other agreement in existence on the Issue Date, between the Company,
DHC or any Investor Party, as such agreement may thereafter be amended,
modified, restated, renewed, extended, refinanced, refunded or replaced, as
applicable, on terms not materially less favorable to the Company and its
Restricted Subsidiaries, taken as a whole, than those terms in effect on
the Issue Date, and any such amendment, modification, restatement, renewal,
extension, refinancing, refunding or replacement;
(10) transactions with CPIH and its Subsidiaries pursuant to
agreements in existence or entered into on the Issue Date, as such
agreements may thereafter be amended, modified, restated, renewed,
extended, refinanced, refunded or replaced, as applicable, on terms not
materially less favorable to the Company and its Restricted Subsidiaries,
taken as a whole, than the terms of such agreements as in effect on the
Issue Date, and any such amendment, modification, restatement, renewal,
extension, refinancing, refunding or replacement;
(11) transactions pursuant to any other arrangement, contract or
agreement in existence on the Issue Date, as such arrangement, contract or
agreement may thereafter be amended, modified, restated, renewed, extended,
refinanced, refunded or replaced from time to time; provided that any such
amendment, modification, restatement, renewal, extension, refinancing,
refunding or replacement is on terms not materially less favorable to the
Company and its Restricted Subsidiaries, taken as a whole, than the
arrangement, contract or agreement in existence on the Issue Date; and
(12) sales of Equity Interests, other than Disqualified Stock, of the
Company to Affiliates of the Company.
Section 4.12 Liens.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind securing Indebtedness or trade payables on any asset
now owned or hereafter acquired, except Permitted Liens.
(b) If the Company or any of its Restricted Subsidiaries shall create,
incur, assume or suffer to exist any such Lien not permitted by the provisions
of Section 4.12(a), the Company and such Restricted Subsidiary (i) shall be
deemed to have automatically and without further action secured the Obligations
under the Notes with such Lien equally and ratably with any and all other
Indebtedness secured thereby as long as any such Indebtedness shall be so
secured, and (ii) shall take or cause to be taken such actions as Holders deem
necessary or advisable to evidence such equal and ratable Lien; provided that,
notwithstanding the foregoing, this covenant shall not be construed as a consent
by Holders to the creation of any such Lien not permitted by the provisions of
Section 4.12(a) and the creation or assumption of any such Lien not permitted by
the provisions of Section 4.12(a) shall constitute an Event of Default.
Section 4.13 Business Activities.
The Company shall not, and shall not permit any of its Subsidiaries to,
engage in any business other than Permitted Businesses, except to such extent as
would not be material to the Company and its Subsidiaries taken as a whole.
Section 4.14 Corporate Existence.
Subject to Article 5, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect:
(1) its corporate existence, and the corporate, partnership or other
existence of each of its Restricted Subsidiaries, in accordance with the
respective or organizational documents (as the same may be amended from
time to time) of the Company or any such Restricted Subsidiary; and (2) the
material rights (charter and statutory), licenses and franchises of the
Company and its Restricted Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or
franchise, of the Company or any of its Restricted Subsidiaries, if the
Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries, taken as a whole, and that the loss thereof is not
materially adverse to the Holders of the Notes or such action as is
otherwise permitted by this Indenture.
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) Subject to the Company's right to redeem the Notes pursuant to
Section 3.07, upon the occurrence of a Change of Control, the Company shall make
an offer (a "Change of Control Offer") to each Holder to repurchase all or any
part (in a minimum aggregate principal amount at Stated Maturity of $1,000 or an
integral multiple of $1,000) of such Holder's Notes at a purchase price in cash
equal to 101% of the Accreted Value of the Notes repurchased plus accrued and
unpaid interest on the Notes repurchased to the date of repurchase (the "Change
of Control Payment"). Within 10 days following any Change of Control, if the
Company has not sent a redemption notice pursuant to Section 3.03 for all of the
Notes, the Company shall mail a notice to each Holder describing the transaction
or transactions that constitute the Change of Control and 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 purchase price and the purchase date, which date shall be no
earlier than 30 days and no later than 60 days after the date on which such
notice is mailed (the "Change of Control Payment Date");
(3) that any Note not tendered shall continue to accrue interest;
(4) that, unless the Company defaults in the payment of the Change of
Control Payment, all 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 electing to have any Notes purchased pursuant to a
Change of Control Offer shall be required to surrender the Notes, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the third Business Day preceding the
Change of Control Payment Date;
(6) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
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 Notes delivered for purchase, and a
statement that such Xxxxxx is withdrawing his election to have the Notes
purchased; and
(7) that Holders whose Notes are being purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof.
(b) The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder
to the extent those laws and regulations are applicable in connection with
the repurchase of the Notes as a result of a Change in Control. To the
extent that the provisions of any securities laws or regulations conflict
with the provisions of Sections 3.09, 3.10 or 4.15, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under Section 3.09, 3.10 or this
Section 4.15 by virtue of such conflict.
(c) On the Change of Control Payment Date, the Company shall, to the
extent lawful:
(1) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions of Notes properly
tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes properly
accepted together with an Officer's Certificate stating the aggregate
principal amount of Notes or portions of Notes being purchased by the
Company.
Any Note so accepted for payment shall cease to accrue interest on and
after the Change of Control Payment Date.
(d) The Paying Agent shall promptly mail to each Holder of Notes
properly tendered the Change of Control Payment for such Notes, and the Trustee
shall promptly authenticate and mail (or cause to be transferred by book entry)
to each Holder a new Note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; provided that each new Note shall be in a
minimum aggregate principal amount of $1,000 or an integral multiple thereof. If
the Change of Control Payment Date is on or after an interest record date and on
or before the related Interest Payment Date, accrued and unpaid interest, if
any, shall be paid to the Holder in whose name a note is registered at the close
of business on such record date, and no additional interest shall be payable to
the holders who tender pursuant to the Change of Control Offer. The Company
shall publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Payment Date.
(e) Notwithstanding anything to the contrary in this Section 4.15, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section 4.15 and Section 3.10 and purchases all Notes validly tendered and not
withdrawn under the Change of Control Offer.
Section 4.16 Payments for Consent.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any Holder of Notes for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture, the Notes or the
Security Documents unless such consideration is offered to be paid and is paid
to all Holders of the Notes that consent, waive or agree to amend in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
Section 4.17 Additional Subsidiary Guarantees and Liens.
If the Company or any of its Restricted Subsidiaries acquires or
creates another Domestic Subsidiary after the Issue Date, excluding any
Subsidiary that has been properly designated as an Unrestricted Subsidiary in
accordance with this Indenture for so long as it continues to constitute an
Unrestricted Subsidiary, then that newly acquired or created Domestic Subsidiary
shall become a Guarantor and (a) execute a supplemental indenture and deliver an
Opinion of Counsel reasonably satisfactory to the Trustee within 10 Business
Days of the date on which it was acquired or created, (b) if such Domestic
Subsidiary grants any Lien upon any of its assets and property as security for
any Credit Agreement Obligations, execute any and all further Security
Documents, financing statements, agreements and instruments, upon substantially
the same terms as the security documents in respect of such Credit Agreement
Obligations, but subject to the Intercreditor Agreement, that grants the Trustee
a third-priority Lien upon such assets and property for the benefit of the
Holders and take all such actions (including the filing and recording of
financing statements, fixture filings, Mortgages and other documents) that may
be required under any applicable law, or which the Trustee may reasonably
request to create such third-priority Lien, all at the expense of the Company,
including all reasonable fees and expenses of counsel incurred by the Trustee in
connection therewith, and (c) deliver to the Trustee an Opinion of Counsel,
reasonably satisfactory to the Trustee, that such Subsidiary Guarantee and any
such Security Documents, as the case may be, are valid, binding and enforceable
obligations of such Subsidiary, subject to customary exceptions for bankruptcy,
fraudulent conveyance and equitable principles.
Section 4.18 Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary, if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate
fair market value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary properly so designated will be deemed
to be an Investment made as of the time of the designation and shall reduce the
amount available for Restricted Payments under the first paragraph of Section
4.07 or Permitted Investments, as determined by the Company. Such a designation
shall only be permitted if the Investment would be permitted at that time and if
the Restricted Subsidiary otherwise meets the criteria for being an Unrestricted
Subsidiary. The Board of Directors may redesignate any Unrestricted Subsidiary
to be a Restricted Subsidiary if the redesignation would not cause a Default.
Section 4.19 Limitation on Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any Sale/Leaseback Transaction; provided that the
Company or any Restricted Subsidiary may enter into a Sale/Leaseback transaction
if:
(1) the Company or that Restricted Subsidiary, as applicable, could
have incurred Indebtedness in an amount equal to the Attributable Debt
relating to such Sale/Leaseback Transaction in compliance with Section
4.09;
(2) the gross cash proceeds of such Sale/Leaseback Transaction are at
least equal to the fair market value (in the case of gross cash proceeds in
excess of $5.0 million, as determined in good faith by the Board of
Directors, and as so determined by the Board of Directors and set forth in
an Officer's Certificate delivered to the Trustee in the case of gross cash
proceeds in excess of $15.0 million), of the property that is the subject
of such Sale/Leaseback Transaction; and
(3) the transfer of assets in such Sale/Leaseback Transaction is
permitted by, and the Company applies the proceeds of such transaction in
compliance with, Section 4.10.
Section 4.20 Limitation on Performance Guarantees.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or become obligated with
respect to any Performance Guarantee other than Performance Guarantees which are
unsecured and which:
(1) are in effect on the Issue Date;
(2) replace, renew or extend Performance Guarantees permitted pursuant
to clause (1) above;
(3) support Expansions of existing waste-to-energy Projects.
(4) are required in connection with waste-to-energy Projects
undertaken by the Company or any of its Restricted Subsidiaries after the
Issue Date (i) with respect to which the Company's or such Restricted
Subsidiary's Investment therein constitutes a Permitted Investment or a
Restricted Payment not prohibited by Section 4.07 or (ii) in which neither
the Company nor any of its Restricted Subsidiaries has any Investment; or
(5) are entered into in connection with a Bankrupt Subsidiary ceasing
to be a Bankrupt Subsidiary, for the purpose of replacing a Performance
Guarantee relating to such Bankrupt Subsidiary that was in effect
immediately prior to the Issue Date but was terminated on the Issue Date,
so long as no Persons enter into any such replacement Performance Guarantee
as obligors other than the obligors under the Performance Guaranty being so
replaced.
Section 4.21 Payment of Additional Interest
The Company shall apply for and use reasonable business efforts to
obtain and maintain ratings of the Notes from both Xxxxx'x and S&P. If the Notes
have not been rated by either Xxxxx'x or S&P within 90 days after the Issue
Date, the Company shall pay, as additional interest on the Notes, an amount
equal to 0.25% of the principal amount of the Notes at maturity until a rating
is obtained from one or both of Xxxxx'x or S&P. Such additional interest shall
be computed in the same manner and shall be payable at the same times and to the
same Persons as other interest on the Notes. Any failure by the Company to
obtain or maintain the ratings required by this Section 4.21 solely as a result
of the inaction or refusal to act by any such rating agency that is beyond the
control of the Company shall not constitute a breach of this Section 4.21 or
require the payment of such additional interest. The Company shall give prompt
written notice to the Trustee of the occurrence of any event requiring the
payment of additional interest pursuant to this Section 4.21.
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
(a) The Company shall not, directly or indirectly: (1) consolidate or
merge with or into another Person (whether or not the Company is the surviving
corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company and its
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person; unless:
(1) either: (a) the Company is the surviving corporation; or (b) the
Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance
or other disposition has been made is a Person organized or existing under
the laws of the United States, any state of the United States or the
District of Columbia;
(2) the Person formed by or surviving any such consolidation or merger
(if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition has been made assumes all the
obligations of the Company under the Notes and this Indenture, pursuant to
a supplemental indenture or other agreements reasonably satisfactory to the
Trustee;
(3) immediately after giving effect to such transaction no Default or
Event of Default exists;
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been made shall,
on the date of such transaction after giving pro forma effect thereto and
any related financing transactions as if the same had occurred at the
beginning of the applicable four-quarter period, (i) be permitted to incur
at least $1.00 of additional Indebtedness pursuant to the Consolidated
Coverage Ratio test set forth in the first paragraph of Section 4.09(a) or
(ii) (A) would have a Consolidated Coverage Ratio greater than the
Consolidated Coverage Ratio of the Company immediately prior to such
transaction and without taking into account such transaction and any
related financing transactions and (B) has received and delivered to the
Trustee letters from Xxxxx'x and S&P stating that the Notes, after giving
effect to such transaction and any related financing transactions, will be
rated at least "Ba1" and "BB+" by such agencies, respectively; and
(5) the Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture, if any,
comply with this Indenture.
(b) In addition, the Company shall not, directly or indirectly, lease
all or substantially all of its properties or assets, in one or more related
transactions, to any other Person. This Section 5.01 will not prohibit (i) any
sale, assignment, transfer, conveyance or other disposition of assets between or
among the Company and any Guarantor, (ii) any Restricted Subsidiary from
consolidating with, merging into or transferring all or part of its assets to
the Company or any Guarantor, or (iii) the Company from merging with an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another jurisdiction to realize tax or other benefits.
(c) In the event of any transaction (other than a lease) described in
and complying with the conditions listed in the immediately preceding paragraph
in which the Company is not the surviving Person and the surviving Person is to
assume all the obligations of the Company under the Notes and this Indenture
pursuant to a supplemental indenture, such surviving Person shall succeed to,
and be substituted for, and may exercise every right and power of, the Company,
and the Company would be discharged from its obligations under this Indenture
and the Notes.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal or Accreted Value of, and interest and premium, if any, on, the Notes
except in the case of a sale of all of the Company's assets in a transaction
that is subject to, and that complies with the provisions of, Section 5.01.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following is an "Event of Default":
(1) the Company defaults for 30 consecutive days in the payment when
due of interest on the Notes;
(2) the Company defaults in payment when due of the principal or
Accreted Value of, or premium, if any, on the Notes;
(3) failure by the Company or any of its Restricted Subsidiaries to
comply with its obligations to make any Change of Control Payment pursuant
to Section 4.15 or to comply with the provisions of Section 5.01;
(4) failure by the Company or any of its Restricted Subsidiaries for
30 days after written notice from the Trustee or Holders of at least 25% in
aggregate principal amount of the outstanding Notes to comply with the
provisions of any of Sections 4.07, 4.09 or 4.10;
(5) failure by the Company or any of its Restricted Subsidiaries for
60 days after written notice from the Trustee or Holders of at least 25% in
aggregate principal amount of the outstanding Notes to comply with any of
the other agreements in this Indenture or the Security Documents;
(6) default under any mortgage, indenture, agreement or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness of the Company or any of its Restricted
Subsidiaries whether such Indebtedness now exists, or is created after the
Issue Date, if that default:
(A) is caused by a failure to pay principal of or liquidation
preference of such Indebtedness at the final stated maturity thereof
(giving effect to any applicable grace periods and any extensions
thereof); or
(B) results in the acceleration of such Indebtedness prior to its
express maturity; or
(C) results in a requirement that the Company or any of its
Restricted Subsidiaries collateralize any letter of credit thereunder
and the Company or such Restricted Subsidiary fails to provide the
required collateral on the terms and within the times set forth
therein (giving effect to any applicable grace periods and any
extensions thereof);
and, in each case, if the principal amount of such Indebtedness or the
amount of such collateralization requirement aggregates $20.0 million or
more;
(7) any final judgment or judgments for the payment of money in an
aggregate amount in excess of $10.0 million (or its foreign currency
equivalent at the time) in excess of amounts which the Company's insurance
carriers have agreed to pay under applicable policies shall have been
rendered against the Company or any Restricted Subsidiary of the Company
that is a Significant Subsidiary and shall not have been waived, satisfied,
bonded or discharged for any period of 60 consecutive days during which a
stay of enforcement is not in effect;
(8) the Company or any Restricted Subsidiary of the Company (other
than a Bankrupt Subsidiary) that is a Significant Subsidiary or any group
of Restricted Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary, 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 or taking possession by a
custodian, receiver, liquidator, trustee, assignee or sequestrator of
it or for all or substantially all of its property; or
(D) makes a general assignment for the benefit of its creditors;
or
(9) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Restricted
Subsidiary of the Company (other than a Bankrupt Subsidiary) that is a
Significant Subsidiary or any group of Restricted Subsidiaries of the
Company that, taken as a whole, would constitute a Significant
Subsidiary in an involuntary case; or
(B) appoints a custodian, receiver, liquidator, trustee, assignee
or sequestrator of the Company or any Restricted Subsidiary of the
Company (other than a Bankrupt Subsidiary) that is a Significant
Subsidiary or for all or substantially all of the property of the
Company or any Restricted Subsidiary of the Company that is a
Significant Subsidiary or, in either case, any group of Restricted
Subsidiaries of the Company that, taken as a whole, would constitute a
Significant Subsidiary; or
(C) orders the liquidation of the Company or any Restricted
Subsidiary of the Company (other than a Bankrupt Subsidiary) that is a
Significant Subsidiary or any group of Restricted Subsidiaries of the
Company that, taken as a whole, would constitute a Significant
Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive
days; or
(D) (a) any Subsidiary Guarantee or any Security Document or any
security interest granted thereby is held in any judicial proceeding
to be unenforceable or invalid, or ceases for any reason to be in full
force and effect and such default continues for ten days after written
notice, or (b) the Company or any Guarantor, or any Person acting on
behalf of the Company or any Guarantor, denies or disaffirms its
obligations under any Subsidiary Guarantee or Security Document.
Section 6.02 Acceleration.
(a) In the case of an Event of Default specified in clauses (8) or (9)
of Section 6.01, all outstanding Notes will become due and payable immediately
without further action or notice. If any other Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount at
Stated Maturity of the then outstanding Notes may declare all the Notes to be
due and payable immediately. Upon any such declaration the Notes shall become
due and payable immediately. The amount due and payable with respect to
principal of the Notes upon any acceleration hereunder shall be the Accreted
Value of the Notes as of the date of acceleration.
(b) In the event of a declaration of acceleration of the Notes because
an Event of Default has occurred and is continuing as a result of the
acceleration of any Indebtedness described in clause (6) of Section 6.01, the
declaration of acceleration of the Notes shall be automatically annulled if the
holders of any Indebtedness described in clause (6) of Section 6.01 have
rescinded the declaration of acceleration in respect of the Indebtedness within
30 days of the date of the declaration and if:
(1) the annulment of the acceleration of Notes would not conflict with
any judgment or decree of a court of competent jurisdiction; and
(2) all existing Events of Default, except nonpayment of principal or
interest on the Notes that became due solely because of the acceleration of
the Notes, have been cured or waived.
(c) The Holders of a majority in aggregate principal amount at Stated
Maturity of the then outstanding Notes by written notice to the Trustee may on
behalf of all of the Holders rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default (except nonpayment of principal, interest or premium that has
become due solely because of the acceleration) have been cured or waived.
(d) If an Event of Default occurs by reason of any willful action (or
inaction) taken (or not taken) by or on behalf of the Company with the intention
of avoiding payment of the premium that the Company would have had to pay if the
Company then had elected to redeem the Notes pursuant to Section 3.07, then,
upon acceleration of the Notes, an equivalent premium, based upon the Accreted
Value of the Notes as of the date of acceleration, shall also become and be
immediately due and payable, to the extent permitted by law, anything in this
Indenture or in the Notes to the contrary notwithstanding.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal or Accreted Value of
and 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 of a
Note in exercising any right or remedy accruing upon an Event of Default shall
not impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. No remedy is exclusive of any other remedy. All remedies are
cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal or Accreted Value of or premium or interest on, the
Notes, including in connection with an offer to purchase (other than a
rescission of acceleration of the Notes by the Holders of a majority in
aggregate principal amount at Stated Maturity of the then outstanding Notes);
provided, however, that the Holders of a majority in aggregate principal amount
at Stated Maturity of the then outstanding Notes may rescind an acceleration and
its consequences, including any related payment default that resulted from such
acceleration. Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
Section 6.05 Control by Majority.
Holders of a majority in aggregate principal amount at Stated Maturity
of the then outstanding Notes may direct the time, method and place of
conducting any proceeding for exercising any remedy available to the Trustee or
exercising any trust or power conferred on it. However, the Trustee may refuse
to follow any direction that conflicts with law, this Indenture or the Security
Documents that the Trustee determines may be unduly prejudicial to the rights of
other Holders of Notes or that may involve the Trustee in personal liability and
may take any other action it deems proper that is not inconsistent with such
direction.
Section 6.06 Limitation on Suits.
(a) A Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:
(1) the Holder of a Note 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
then outstanding Notes make a written request to the Trustee to pursue the
remedy;
(3) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity 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, the provision of
indemnity; and
(5) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal or Accreted Value of, and
premium, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal or Accreted Value of, premium, if any, and interest remaining unpaid
on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07. To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 out of the estate in any such
proceeding, shall be denied for any reason, payment of the same shall be secured
by a Lien on, and shall be paid out of, any and all distributions, dividends,
money, securities and other properties that the Holders may be entitled to
receive in such proceeding whether in liquidation or under any plan of
reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10 Priorities.
(a) If the Trustee collects any money pursuant to this Article 6, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys (including any
Collateral Agent) for amounts due under Section 7.07, including payment
of all compensation, expense and liabilities incurred, and all advances
made, by the Trustee and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal or Accreted Value, premium and interest, ratably,
without preference or priority of any kind, according to the amounts
due and payable on the Notes for principal or Accreted Value, premium
and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
(b) The Trustee may, upon prior written notice to the Company, fix a
record date and payment date for any payment to Holders of Notes pursuant to
this Section 6.10.
Section 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee or any Collateral Agent for any
action taken or omitted by it as Trustee or as Collateral Agent, 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 6.11 does not apply
to a suit by the Trustee or by any Collateral Agent, a suit by a Holder of a
Note pursuant to Section 6.07, or a suit by Holders of more than 25% in
principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(1) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(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. However,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(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 by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to the
provisions of this Article 7.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder has offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon 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.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officer's Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it reasonably takes
or omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture, provided, however, that
the Trustee's conduct does not constitute willful misconduct or negligence.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
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 otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the Commission
for permission to continue as trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11.
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, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
The Trustee shall not be responsible for and makes no representation as
to the value or condition of the Collateral or any part thereof, or as to the
title of the Company thereto, or as to the security afforded thereby or hereby,
or as to the validity or genuineness of any Collateral pledged and deposited
with the Trustee. The Trustee makes no representation with respect to the
effectiveness or adequacy of the Security Documents, or the validity or
perfection of Liens granted under this Indenture or the Security Documents. The
Trustee shall not be responsible for independently ascertaining or maintaining
such validity or perfection, if any and shall be fully protected in relying upon
certificates and opinions delivered to it in accordance with the terms of this
Indenture or the Security Documents.
Section 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and the
Trustee receives actual notice of such event, the Trustee shall mail to the
Holders of the Notes, as their names and addresses appear on the Noteholder list
described in Section 2.05, a notice of the Default or Event of Default within 90
days after it occurs. Except in the case of a Default or Event of Default in
payment of principal of, premium or interest on any Note, 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 interests of the
Holders of the Notes.
Section 7.06 Reports by Trustee to Holders.
(a) Within 60 days after each May 15 beginning May 15, 2005, and for so
long as Notes remain outstanding, the Trustee shall mail to the Holders of the
Notes a brief report dated as of such reporting date that complies with TIA ss.
313(a) (but if no event described in TIA ss. 313(a) has occurred within the
twelve months preceding the reporting date, no report need be transmitted). The
Trustee also will comply with TIA ss. 313(b)(2). The Trustee shall also transmit
by mail all reports as required by TIA ss. 313(c). (b) A copy of each report at
the time of its mailing to the Holders of Notes shall be mailed by the Trustee
to the Company and filed by the Trustee with the Commission and each stock
exchange, if any, on which the Notes are listed in accordance with TIA ss.
313(d). The Company shall promptly notify the Trustee when the Notes are listed
on any stock exchange and of any delisting thereof.
Section 7.07 Compensation and Indemnity.
(a) The Company shall pay to the Trustee such compensation for its
acceptance of this Indenture and services hereunder as agreed from time to time
by the Company and the Trustee. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by it in addition to the compensation for
its services. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
(b) The Company and each Guarantor shall indemnify the Trustee and any
Collateral Agent, and hold them harmless, against any and all losses,
liabilities or expenses incurred by them arising out of or in connection with
the acceptance or administration of their duties under this Indenture, including
the reasonable costs and expenses of enforcing this Indenture against the
Company and the Guarantors (including this Section 7.07) and defending
themselves against any claim (whether asserted by the Company, the Guarantors or
any Holder or any other Person) or liability in connection with the exercise or
performance of any of their powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to their negligence or bad
faith. The Trustee (or, if the claim is against a Collateral Agent, the
applicable Collateral Agent) shall notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee or a Collateral Agent to so
notify the Company shall not relieve the Company or any of the Guarantors of
their obligations hereunder. The Company or such Guarantor shall defend the
claim and the Trustee (or the Collateral Agent, as applicable) shall cooperate
in the defense. The Trustee may have separate counsel and the Company shall pay
the reasonable fees and expenses of such counsel. Neither the Company nor any
Guarantor need pay for any settlement made without its consent, which consent
shall not be unreasonably withheld.
(c) The obligations of the Company and the Guarantors under this
Section 7.07 shall survive the satisfaction and discharge of this Indenture,
resignation or removal of any Trustee and the discharge of the Company's
obligations pursuant to Article 8 hereof.
(d) To secure the Company's payment obligations 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 that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(8) or (9) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) shall be preferred over the status of the Holders in a proceeding under
any Bankruptcy Law, and are intended to constitute expenses of administration
under any Bankruptcy Law.
(f) The Trustee shall comply with the provisions of TIA ss. 313(b)(2)
to the extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
(b) The Trustee may resign, upon 30 days written notice to the Company,
in writing at any time and be discharged from the trust hereby created by so
notifying the Company. The Holders of a majority in principal amount of the then
outstanding Notes may remove the Trustee by so notifying the Trustee and the
Company in writing. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(3) a custodian or public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
(d) If a successor Xxxxxxx does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company,
or the Holders of at least 25% in principal amount of the then outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(e) If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07. Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
Section 7.09 Successor Trustee by Xxxxxx, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
Section 7.10 Eligibility; Disqualification.
(a) There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $100 million as set forth in its most recent published annual report of
condition.
(b) This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of the Board of Directors evidenced by a
resolution set forth in an Officer's Certificate, at any time, elect to have
either Section 8.02 or 8.03 be applied to all outstanding Notes (including the
Subsidiary Guarantees) upon compliance with the conditions set forth below in
this Article 8.
Section 8.02 Legal Defeasance and Discharge.
(a) Upon the Company's exercise under Section 8.01 of the option
applicable to this Section 8.02 and subject to the satisfaction of the
conditions set forth in Section 8.04, the Subsidiary Guarantees shall be
released and the Company and each of the Guarantors shall be deemed to have been
discharged from their obligations with respect to all outstanding Notes
(including the Subsidiary Guarantees) on the date the conditions set forth below
are satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal
Defeasance means that the Company and the Guarantors will be deemed to have paid
and discharged the entire Indebtedness represented by the outstanding Notes
(including the Subsidiary Guarantees), which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 and the other Sections of
this Indenture referred to in clauses (1) and (2) below, and to have satisfied
all their other obligations under such Notes, the Subsidiary Guarantees and this
Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder:
(1) the rights of Holders of outstanding Notes to receive payments in
respect of the principal of, or interest or premium, if any, on such Notes
when such payments are due from the trust referred to in Section 8.04;
(2) the Company's obligations with respect to such Notes under Article
2 and Section 4.02;
(3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Company's and the Guarantors' obligations in connection
therewith; and
(4) this Article 8.
(b) Subject to compliance with this Article 8, the Company may exercise
its option under this Section 8.02 notwithstanding the prior exercise of its
option under Section 8.03.
Section 8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 of the option applicable
to this Section 8.03, the Company and its Restricted Subsidiaries shall, subject
to the satisfaction of the conditions set forth in Section 8.04, be released
from each of their obligations under the covenants contained in Sections 3.09,
4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18, 4.19, 4.20 and
4.21 and clause (4) of Section 5.01(a) and the first sentence of Section 5.01(b)
with respect to the outstanding Notes on and after the date the conditions set
forth in Section 8.04 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
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes and Subsidiary Guarantees, the Company and the Guarantors may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01, but, except as specified above, the
remainder of this Indenture and such Notes and Subsidiary Guarantees shall be
unaffected thereby. In addition, upon the Company's exercise under Section 8.01
of the option applicable to this Section 8.03, subject to the satisfaction of
the conditions set forth in Section 8.04, Sections 6.01(3) through 6.01(6) will
not constitute Events of Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
(a) In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03:
(1) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as shall
be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal or Accreted Value of,
and premium, if any, and interest on the outstanding Notes on the stated
date for payment thereof or on the applicable redemption date, as the case
may be, and the Company must specify whether the Notes are being defeased
to maturity or to a particular redemption date;
(2) in the case of an election under Section 8.02, the Company must
deliver to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that:
(A) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling; or
(B) since the Issue Date, there has been a change in the
applicable federal income tax law,
in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not
occurred;
(3) in the case of an election under Section 8.03, the Company must
deliver to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same 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 Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit);
(5) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) 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 must deliver to the Trustee an Officer's Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent
provided for or relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.
(b) Notwithstanding the foregoing, the Opinion of Counsel required by
clause (7) of Section 8.04(a) need not be delivered if all Notes not therefore
delivered to the Trustee for cancellation (i) have become due and payable or
(ii) will become due and payable on their maturity date within one year under
arrangements satisfactory to the Trustee for the giving of notice of assumption
by the Trustee in the name, and at the expense, of the Company.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
(a) Subject to Section 8.06, all money and noncallable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 in respect of the outstanding Notes shall be
held in trust and applied by the Trustee, in accordance with the provisions of
such Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as Paying Agent) as the Trustee may
determine, to the Holders of such Notes of all sums due and to become due
thereon in respect of principal, premium (if any) and interest, but such money
need not be segregated from other funds except to the extent required by law.
(b) The Company shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
(c) Notwithstanding anything in this Article 8 to the contrary, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a)), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06 Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of or premium or
interest on any Note and remaining unclaimed for two years after such principal,
premium or interest has become due and payable shall be paid to the Company on
its request or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Note shall thereafter be permitted to look only to
the Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Company.
Section 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.02 or
8.03, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's and the Guarantor's obligations under this
Indenture and the Notes and the Subsidiary Guarantees shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.02 or 8.03, as the case may be; provided,
however, that, if the Company makes any payment of principal or Accreted Value
of or premium or interest on any Note following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
(a) Notwithstanding Section 9.02, the Company, the Guarantors and the
Trustee may amend or supplement this Indenture, the Subsidiary Guarantees, the
Notes or the Security Documents without the consent of any Holder of a Note:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(3) to provide for the assumption of the Company's obligations to
Holders of Notes in the case of a merger or consolidation or sale of all or
substantially all of the Company's assets;
(4) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that would not adversely affect the
legal rights under this Indenture of any such Holder;
(5) to comply with requirements of the Commission in order to effect
or maintain the qualification of this Indenture under the TIA;
(6) to allow any Guarantor to execute a supplemental indenture and/or
a Subsidiary Guarantee with respect to the Notes; or
(7) if necessary, in connection with any addition or release of
Collateral permitted under the terms of this Indenture or the Security
Documents.
(b) Upon the request of the Company accompanied by a resolution of the
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02, the Trustee shall join with the Company and the Guarantors in the
execution of any amended or supplemental Indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee shall not be
obligated to enter into such amended or supplemental Indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
(c) The Company shall be entitled to releases of the Collateral or the
Subsidiary Guarantees as described in Sections 10.03, 11.05 and 11.06.
Section 9.02 With Consent of Holders of Notes.
(a) Except as provided below in this Section 9.02, the Company, the
Guarantors and the Trustee may amend or supplement any provision of this
Indenture, the Subsidiary Guarantees, the Notes or the Security Documents with
the consent of the Holders of at least a majority in principal amount of the
Notes then outstanding voting as a single class (including, without limitation,
consents obtained in connection with a purchase of or a tender offer or exchange
offer for the Notes), and, subject to Sections 6.04 and 6.07, any existing
Default or compliance with any provision of this Indenture, the Notes or the
Security Documents may be waived with the consent of the Holders of a majority
in principal amount of the then outstanding Notes voting as a single class
(including consents obtained in connection with a tender offer or exchange offer
for, or purchase of, the Notes). Section 2.08 shall determine which Notes are
considered to be "outstanding" for purposes of this Section 9.02.
(b) Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture or other amendment, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02, the
Trustee shall join with the Company in the execution of such amended or
supplemental Indenture or other amendment unless such amended or supplemental
Indenture or other amendment directly affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise, in which case the Trustee may
in its discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture or other amendment.
(c) It is not necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it is sufficient if such consent approves the substance thereof.
(d) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such amended or
supplemental Indenture or waiver. Subject to Sections 6.04 and 6.07, the Holders
of a majority in aggregate principal amount of the Notes then outstanding voting
as a single class may waive compliance in a particular instance by the Company
with any provision of this Indenture, the Notes or the Security Documents.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;
(2) reduce the principal or Accreted Value of or change the stated
maturity of any Note or alter or waive any of the provisions with respect
to the redemption or repurchase of the Notes;
(3) reduce the rate of or change the time for payment of interest,
including default interest, on any Note;
(4) waive a Default or Event of Default in the payment of principal or
Accreted Value of or premium or interest on the Notes (except a rescission
of acceleration of the Notes by the Holders of a majority in aggregate
principal amount of the then outstanding Notes and a waiver of the payment
default that resulted from such acceleration);
(5) make any Note payable in money other than that stated in this
Indenture;
(6) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive
payments of principal or Accreted Value of, or interest or premium on, the
Notes;
(7) waive a redemption payment with respect to any Note other than a
payment required by Sections 3.09, 4.10 and 4.15;
(8) subordinate in right of payment the Notes or any Subsidiary
Guarantee to any other Indebtedness of the Company or any Guarantor; or
(9) make any change in the preceding amendment and waiver provisions;
(e) Any amendment to, or waiver of, the provisions of this Indenture or
the Security Documents relating to the release of any Guarantor from any of its
Obligations under its Subsidiary Guarantee, this Indenture or the Security
Documents, except in accordance with the terms of this Indenture, shall require
the consent of the Holders of at least 75% in aggregate principal amount of
Notes then outstanding.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Xxxxxx's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver. Failure to make the appropriate notation or issue a new
Note will not affect the validity and effect of such amendment, supplement or
waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee shall sign any amended or supplemental Indenture or other
amendment authorized pursuant to this Article 9 if the amendment or supplement
does not adversely affect the rights, duties, liabilities or immunities of the
Trustee. The Company may not sign an amended or supplemental Indenture or other
amendment until the Board of Directors approves it. In executing any amended or
supplemental indenture or other amendment, the Trustee shall be entitled to
receive and (subject to Section 7.01) shall be fully protected in relying upon,
in addition to the documents required by Section 13.04, an Officer's Certificate
and an Opinion of Counsel stating that the execution of such amended or
supplemental Indenture or other amendment is authorized or permitted by this
Indenture.
ARTICLE 10.
COLLATERAL AND SECURITY
Section 10.01 Security Documents.
The due and punctual payment of the principal and Accreted Value of and
interest and premium (if any) on the Notes when and as the same shall be due and
payable, whether on an Interest Payment Date, at maturity, by acceleration,
repurchase, redemption or otherwise, and interest on the overdue principal or
Accreted Value of and interest on the Notes and performance of all other
obligations of the Company to the Holders or the Trustee under this Indenture
and the Notes, according to the terms hereunder or thereunder, are secured as
provided in the Security Documents which the Company and certain of the
Guarantors have entered into simultaneously with the execution of this
Indenture, subject to the terms of the Intercreditor Agreement. Each Holder of a
Note, by its acceptance thereof, consents and agrees to the terms of this
Indenture and the Security Documents (including the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be
amended from time to time in accordance with its terms or the terms hereof and
authorizes and directs the Collateral Agent to enter into the Security Documents
and to perform its obligations and exercise its rights thereunder in accordance
therewith. The Company shall deliver to the Trustee (if it is not itself then
the Collateral Agent) copies of all documents delivered to the Collateral Agent
pursuant to the Security Documents, and shall do or cause to be done all such
acts and things as may be required by the next sentence of this Section 10.01,
to assure and confirm to the Trustee and the Collateral Agent the security
interest in the Collateral contemplated hereby, by the Security Documents or any
part thereof, as from time to time constituted, so as to render the same
available for the security and benefit of this Indenture and of the Notes
secured hereby, according to the intent and purposes herein expressed. The
Company shall take, and shall cause its Restricted Subsidiaries to take, any and
all actions reasonably required to cause the Security Documents to create and
maintain, as security for the Obligations of the Company and the Guarantors
hereunder, a valid and enforceable perfected Lien and security interest in and
on 100% of the capital stock of, or other Equity Interests in, existing and
future Domestic Subsidiaries owned by the Company and its Restricted
Subsidiaries, substantially all the personal property assets of the Company and
the Guarantors party to the Security Documents, all fee interests in real
property assets and all leasehold interests, in favor of the Collateral Agent
for the benefit of the Holders, junior in priority (subject to Permitted Liens)
to Liens securing Credit Agreement Obligations.
Section 10.02 Recording and Opinions.
(a) The Company shall furnish to the Collateral Agent and the Trustee
on January 15 in each year beginning with January 15, 2005, an Opinion of
Counsel, which may be rendered by internal counsel to the Company, dated as of
such date, either:
(1) (A) stating that, in the opinion of such counsel, action has been
taken with respect to the recording, registering, filing, re-recording,
re-registering and re-filing of all supplemental indentures, financing
statements, continuation statements or other instruments of further
assurance as is necessary to maintain and perfect the Lien of the Security
Documents and reciting with respect to the security interests in the
Collateral the details of such action or referring to prior Opinions of
Counsel in which such details are given, and (B) stating that, in the
opinion of such counsel, based on relevant laws as in effect on the date of
such Opinion of Counsel, all financing statements and continuation
statements have been executed and filed that are necessary as of such date
and during the succeeding 12 months fully to preserve, perfect and protect,
to the extent such protection and preservation are possible by filing, the
rights of the Collateral Agent and the Trustee hereunder and under the
Security Documents with respect to the security interests in the
Collateral; or
(2) stating that, in the opinion of such counsel, no such action is
necessary to maintain and perfect such Lien and assignment.
(b) The Company shall otherwise comply with the provisions of TIA
Section 314(b).
Section 10.03 Release of Collateral/Additional Liens.
(a) Subject to subsections (b), (c) and (d) of this Section 10.03,
Collateral may be released from the Lien and security interest created by the
Security Documents at any time or from time to time in accordance with the
provisions of the Security Documents or as provided hereby. Whether prior to or
after the Discharge of Credit Agreement Obligations, upon the request of the
Company pursuant to an Officer's Certificate certifying that all conditions
precedent hereunder have been met and without the consent of any Holder, the
Company and the Guarantors party to the Security Documents shall be entitled to
a release (or in the case of clause (3) below, a subordination) of the security
interests on assets included in the Collateral from the Liens securing the Notes
and the Subsidiary Guarantees under any one or more of the following
circumstances:
(1) to enable the Company or any Guarantor to consummate any sale,
lease, conveyance or other disposition of any assets or rights permitted or
not prohibited under Section 4.10;
(2) in respect of assets subject to a permitted purchase money lien;
(3) if all of the stock of any Subsidiary of the Company that is
pledged as part of the Collateral is released or if any Subsidiary that is
a Guarantor is released from its Subsidiary Guarantee, such Subsidiary's
assets will also be released; or
(4) pursuant to an amendment, waiver or supplement in accordance with
Article 9;
provided that, in the case of a release requested under clauses (1), (2) or (3),
above, or a subordination under clause (2) above, the Credit Agent concurrently
releases (or in the case of a requested subordination under clause (2) above,
subordinates) the Liens securing Credit Agreement Obligations with respect to
the affected assets and, provided further, that if there are any subordinated
Liens on such assets, such subordinated Liens are similarly released or
subordinated.
Upon receipt of such Officer's Certificate, the Collateral Agent shall
execute, deliver or acknowledge any necessary or proper instruments of
termination, satisfaction or release to evidence the release (or in the case of
clause (2) above, the subordination) of any Collateral permitted to be released
(or in the case of clause (2) above, subordinated) pursuant to this Indenture or
the Security Documents.
Notwithstanding anything to the contrary in this Section 10.03(a) or in
Section 10.03(b), as long as the Company is in compliance with the provisions of
Section 10.03(f), the Company or any Guarantor may, pursuant to and in
accordance with this Indenture and the Security Documents, without requesting
the release or consent of the Trustee or the Collateral Agent or any Holder and
without delivering an Officer's Certificate:
(A) sell or dispose of in the ordinary course of business, free
from the Lien and security interest created by the Security Documents,
any machinery, equipment, furniture, apparatus, tools, implements,
materials, supplies or other similar property ("Subject Property")
which, in the Company's reasonable opinion, may have become obsolete
or unfit for use in the conduct of its business or the operation of
the Collateral upon replacing the same with, or substituting for the
same, new Subject Property constituting Collateral not necessarily of
the same character but being of at least equal value and utility as
the Subject Property so disposed of, as long as such new Subject
Property becomes subject to the Lien and security interest created by
the Security Documents;
(B) abandon, sell, assign, transfer, license or otherwise dispose
of in the ordinary course of business any personal property the use of
which is no longer necessary or desirable in the proper conduct of the
business or maintenance of the earnings of the Company and its
Subsidiaries, taken as a whole, and is not material to the conduct of
the business of the Company and its Subsidiaries, taken as a whole;
(C) grant in the ordinary course of business rights-of-way and
easements over or in respect of any of the Company's or any
Guarantor's real property; provided that such grant shall not, in the
reasonable opinion of the Board of Directors, impair the usefulness of
such property in the conduct of the Company's and its Subsidiaries'
business, taken as a whole, and shall not be materially prejudicial to
the interests of the Holders;
(D) sell, transfer or otherwise dispose of inventory in the
ordinary course of business;
(E) sell, collect, liquidate, factor or otherwise dispose of
accounts receivable in the ordinary course of business; and
(F) make cash payments (including for the scheduled repayment of
Indebtedness) from cash that is at any time part of the Collateral in
the ordinary course of business that are not otherwise prohibited by
this Indenture and the Security Documents.
(b) Except as may be otherwise provided in the Security Documents or in
this Section 10.03, no Collateral may be released from the Lien and security
interest created by the Security Documents pursuant to the provisions of the
Security Documents unless the Officer's Certificate required by this Section
10.03 has been delivered to the Collateral Agent.
(c) At any time when a Default or Event of Default has occurred and is
continuing and the maturity of the Notes has been accelerated (whether by
declaration or otherwise) and the Trustee has delivered a notice of acceleration
to the Collateral Agent, no release of Collateral pursuant to the provisions of
the Security Documents shall be effective as against the Holders, except as
otherwise provided in the Security Documents.
(d) The release of any Collateral from the terms of this Indenture and
the Security Documents shall not be deemed to impair the security under this
Indenture in contravention of the provisions hereof if and to the extent the
Collateral is released pursuant to the terms of the Security Documents and this
Indenture. To the extent applicable, the Company and the Guarantors shall cause
TIA Section 313(b), relating to reports, and TIA Section 314(d), relating to the
release of property or securities from the Lien and security interest of the
Security Documents and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Security
Documents, to be complied with. Any certificate or opinion required by TIA
Section 314(d) may be made by an Officer of the Company or the Guarantors except
in cases where TIA Section 314(d) requires that such certificate or opinion be
made by an independent Person, which Person shall be an independent engineer,
appraiser or other expert selected or approved by the Trustee and the Collateral
Agent in the exercise of reasonable care, and in accordance with the TIA;
provided that the fair value of Collateral released from the Lien and security
interest of the Security Documents pursuant to the last paragraph of Section
10.03(a) shall not be considered in determining whether the aggregate fair value
of Collateral released from the Lien and security interest of the Security
Documents in any calendar year exceeds the 10% threshold specified in TIA
Section 314(d)(1). The Company's and each Guarantor's right to rely on the
immediately preceding proviso at any time is conditioned upon the Company and
the Guarantors having furnished to the Trustee all certificates described in
Section 10.03(f) that were required to be furnished to the Trustee at or prior
to such time.
(e) The Company may from time to time file with the Commission a
request for an exemption (an "Exemption") from the requirements of TIA Section
314(d) for purposes of the releases of Collateral described in the last
paragraph of Section 10.03(a). The Company shall provide the Trustee with a copy
of any such Exemption and promptly inform the Trustee of any rescission or
termination of, or amendment to, such Exemption.
(f) In the case of transactions permitted by the last paragraph of
Section 10.03(a), the Company and the Guarantors shall deliver to the Trustee,
within 15 days after the end of each of the six month periods ended on March 15
and September 15 of each year, a certificate signed on behalf of the Company by
an Officer of the Company to the effect that all transactions effected pursuant
to the last paragraph of Section 10.03(a) during the immediately preceding six
month period were made by the Company and the Guarantors in the ordinary course
of business and that all proceeds therefrom were used by the Company and the
Guarantors in connection with their respective businesses or to make payments on
the Notes or as otherwise permitted under this Indenture and the Security
Documents.
Section 10.04 Certificates and Opinions of Counsel.
(a) To the extent applicable, the Company shall furnish to the Trustee
and the Collateral Agent, prior to each proposed release of Collateral pursuant
to the Security Documents:
(1) all documents required by TIA Section 314(d); and
(2) an Opinion of Counsel, to the effect that such accompanying
documents constitute all documents required by TIA Section 314(d).
(b) The Trustee may, to the extent permitted by Sections 7.01 and 7.02,
accept as conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such documents and such Opinion of Counsel.
Section 10.05 Certificates of the Trustee.
In the event that the Company wishes to release Collateral in
accordance with the Security Documents at a time when the Trustee is not itself
also the Collateral Agent and has delivered the certificates and documents
required by the Security Documents and Sections 10.03 and 10.04, the Trustee
shall determine whether it has received all documentation required by TIA
Section 314(d) in connection with such release and, based on such determination
and the Opinion of Counsel delivered pursuant to Section 10.04(b), shall deliver
a certificate to the Collateral Agent setting forth such determination.
Section 10.06 Authorization of Actions to be Taken by the Trustee
Under the Security Documents.
(a) Subject to the provisions of Section 7.01 and 7.02 and the
Intercreditor Agreement, the Trustee may, in its sole discretion and without the
consent of the Holders, direct, on behalf of the Holders, the Collateral Agent
to take all actions it deems necessary or appropriate in order to:
(1) enforce any of the terms of the Security Documents; and
(2) collect and receive any and all amounts payable in respect of the
Obligations of the Company hereunder. (b) Subject to the terms of the
Intercreditor Agreement, the Trustee shall have power to institute and
maintain such suits and proceedings as it may deem expedient to prevent any
impairment of the Collateral by any acts that may be unlawful or in
violation of the Security Documents or this Indenture, and such suits and
proceedings as the Trustee may deem expedient to preserve or protect its
interests and the interests of the Holders in the Collateral (including
power to institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid
if the enforcement of, or compliance with, such enactment, rule or order
would impair the security interest hereunder or be prejudicial to the
interests of the Holders or of the Trustee).
Section 10.07 Authorization of Receipt of Funds by the Trustee Under the
Security Documents.
The Trustee is authorized to receive any funds for the benefit of the
Holders distributed under the Security Documents, and to make further
distributions of such funds to the Holders according to the provisions of this
Indenture.
Section 10.08 Termination of Security Interest.
The Trustee shall, at the request of the Company, deliver a certificate
to the Collateral Agent stating that all Obligations under the Notes, the
Subsidiary Guarantees, this Indenture and the Security Documents have been paid
in full, and instruct the Collateral Agent to take the actions set forth in the
next sentence pursuant to this Indenture and the Security Documents upon (1)
payment in full of the principal of, accrued and unpaid interest on the Notes
and all other Obligations under this Indenture, the Subsidiary Guarantees and
the Security Documents that are due and payable at or prior to the time such
principal, accrued and unpaid interest are paid, (2) a satisfaction and
discharge of this Indenture as described in Article 12 or (3) a legal defeasance
or covenant defeasance as described in Article 8. Upon receipt of such
instruction, the Collateral Agent shall execute, deliver or acknowledge any
necessary or proper instruments of termination, satisfaction or release to
evidence the release of all such Liens.
ARTICLE 11.
NOTE GUARANTEES
Section 11.01 Guarantee.
(a) Subject to this Article 11, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that:
(1) the principal and Accreted Value of and premium, if any, and
interest on the Notes shall be promptly paid in full when due, whether at
maturity, by acceleration, redemption or otherwise, and interest on the
overdue principal and Accreted Value of and interest on the Notes, if any,
if lawful, and all other obligations of the Company to the Holders or the
Trustee hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and
(2) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same shall 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.
(b) Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
(c) Subject to Section 11.02, the Guarantors hereby agree that their
obligations hereunder are full and unconditional, irrespective of the validity,
regularity or enforceability of the Notes or this Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder of the Notes
with respect to any provisions hereof or thereof, the recovery of any judgment
against the Company, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor. Each Guarantor hereby waives diligence, presentment, demand of
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 this Subsidiary
Guarantee shall not be discharged except by complete performance of the
obligations contained in the Notes and this Indenture.
(d) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated
in full force and effect.
(e) Each Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 for
the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction
or other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (2) in the event of any declaration of acceleration of
such obligations as provided in Article 6, such obligations (whether or not due
and payable) shall forthwith become due and payable by the Guarantors for the
purpose of this Subsidiary Guarantee. Each Guarantor shall have the right to
seek contribution from any non-paying Guarantor so long as the exercise of such
right does not impair the rights of the Holders under this Subsidiary Guarantee.
Section 11.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree
that the obligations of such Guarantor shall, after giving effect to such
maximum amount and all other contingent and fixed liabilities of such Guarantor
that are relevant under such laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on behalf of
any other Guarantor in respect of the obligations of such other Guarantor under
this Article 11, result in the obligations of such Guarantor under its
Subsidiary Guarantee not constituting a fraudulent transfer or conveyance.
Section 11.03 Execution and Delivery of Subsidiary Guarantees.
(a) To evidence its Subsidiary Guarantee set forth in Section 11.01,
each Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form attached as Exhibit B hereto shall be endorsed by an
Officer of such Guarantor on each Note authenticated and delivered by the
Trustee and that this Indenture shall be executed on behalf of such Guarantor by
one of its Officers.
(b) Each Guarantor hereby agrees that its Subsidiary Guarantee set
forth in Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Subsidiary Guarantee.
(c) If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
(d) The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set
forth in this Indenture on behalf of the Guarantors.
(e) In the event that the Company creates or acquires any Domestic
Subsidiary after the Issue Date, if required by Section 4.17, the Company shall
cause such Domestic Subsidiary to comply with the provisions of Section 4.17 and
this Article 11, to the extent applicable.
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms.
(a) Except as otherwise provided in Section 11.05, no Guarantor may
sell or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, other than the Company or another Guarantor,
except that a Restricted Subsidiary may merge with or into any Guarantor so long
as such Guarantor is the surviving entity, unless:
(1) immediately after giving effect to such transaction, no Default or
Event of Default shall have occurred and be continuing;
(2) if the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such consolidation or
merger is a Restricted Subsidiary immediately following such transaction,
such Person assumes all the obligations of that Guarantor under its
Subsidiary Guarantee pursuant to a supplemental indenture satisfactory to
the Trustee; and
(3) the Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture, if any,
comply with this Indenture;
provided, however, that the foregoing shall not apply to any such consolidation
or merger with or into, or conveyance, transfer or lease to, any Person if the
resulting, survivor or transferee Person will not be a Subsidiary of the Company
and the other terms of this Indenture, including Section 4.10, are complied
with.
(b) In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor Person, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Guarantor, such successor Person shall succeed to and be
substituted for the Guarantor with the same effect as if it had been named
herein as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Subsidiary Guarantees to be endorsed upon all of the Notes
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees theretofore and thereafter issued in accordance with the
terms of this Indenture as though all of such Subsidiary Guarantees had been
issued at the date of the execution hereof.
(c) Except as set forth in Article 4, and notwithstanding Section
11.04(a), nothing contained in this Indenture or in any of the Notes shall
prevent any consolidation or merger of a Guarantor with or into the Company or
another Guarantor, or shall prevent any sale or conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Company or
another Guarantor.
Section 11.05 Releases Following Sale of Assets.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of Capital Stock of
any Guarantor such that it is no longer a Subsidiary of the Company, in each
case to a Person that is not (either before or after giving effect to such
transaction) a Restricted Subsidiary of the Company, or the liquidation of any
Guarantor, then such Guarantor (in the event of a sale or other disposition, by
way of merger, consolidation or otherwise, of all of the capital stock of such
Guarantor or in the event of the liquidation of such Guarantor) or the Person
acquiring the property (in the event of a sale or other disposition of all or
substantially all of the assets of such Guarantor) shall be released and
relieved of any obligations under its Subsidiary Guarantee; provided that the
Net Proceeds of such sale or other disposition are applied in accordance with
the applicable provisions of this Indenture, including without limitation
Section 4.10. Upon delivery by the Company to the Trustee of an Officer's
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition, merger or consolidation was made by the Company or a Subsidiary of
the Company in accordance with the provisions of this Indenture, including
without limitation Section 4.10, the Trustee shall execute any documents
reasonably required in order to evidence the release of any Guarantor from its
obligations under its Subsidiary Guarantee.
(b) Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal or
Accreted Value of and premium and interest on the Notes and for the other
obligations of such Guarantor under this Indenture as provided in this Article
11.
Section 11.06 Release Following Designation as an Unrestricted Subsidiary.
In the event the Company designates any Guarantor as an Unrestricted
Subsidiary in accordance with Section 4.18, the Obligations of such Guarantor
under its Subsidiary Guarantee pursuant to this Article 11 shall be released.
ARTICLE 12.
SATISFACTION AND DISCHARGE
Section 12.01 Satisfaction and Discharge.
(a) This Indenture shall be discharged and shall cease to be of further
effect as to all Notes issued hereunder, when:
(1) either:
(A) all Notes that have been authenticated (except lost, stolen
or destroyed Notes that have been replaced or paid and Notes for whose
payment money has theretofore been deposited in trust and thereafter
repaid to the Company) have been delivered to the Trustee for
cancellation; or
(B) all Notes that have not been delivered to the Trustee for
cancellation have become due and payable by reason of the making of a
notice of redemption or otherwise or shall become due and payable
within one year and the Company or any Guarantor has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in
trust solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as shall be sufficient without consideration of any
reinvestment of interest, to pay and discharge the entire indebtedness
on the Notes not delivered to the Trustee for cancellation for
principal or Accreted Value, premium (if any) and accrued interest to
the date of maturity or redemption;
(2) no Default or Event of Default has occurred and is continuing on
the date of such deposit or will occur as a result of such deposit and such
deposit will not result in a breach or violation of, or constitute a
default under, any other instrument to which the Company or any Guarantor
is a party or by which the Company or any Guarantor is bound;
(3) the Company or any Guarantor has paid or caused to be paid all
sums payable under this Indenture;
(4) the Company has delivered irrevocable instructions to the Trustee
under this Indenture to apply the deposited money toward the payment of the
Notes at maturity or the redemption date, as the case may be; and
(5) the Company has delivered an Officer's Certificate and an Opinion
of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.
(b) Notwithstanding the satisfaction and discharge of this Indenture;
if money has been deposited with the Trustee pursuant to subclause (b) of clause
(1) of Section 12.01(a), the provisions of Section 12.02 and Section 8.06 shall
survive. In addition, nothing in this Section 12.01 shall be deemed to discharge
those provisions of Section 7.07, that, by their terms, survive the satisfaction
and discharge of this Indenture.
Section 12.02 Application of Trust Money.
(a) Subject to the provisions of Section 8.06, all money deposited with
the Trustee pursuant to Section 12.01 shall be held in trust and applied by it,
in accordance with the provisions of the Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal or Accreted Value (and premium, if any) and
interest for whose payment such money has been deposited with the Trustee; but
such money need not be segregated from other funds except to the extent required
by law.
(b) If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 12.01 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 any Guarantor's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 12.01; provided that if the Company has made any payment of principal
of, premium, if any, or interest on any Notes because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or Government Securities held
by the Trustee or Paying Agent.
ARTICLE 13.
MISCELLANEOUS
Section 13.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss.318(c), the imposed duties shall control.
Section 13.02 Notices.
(a) Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
mailed by first class mail (registered or certified, return receipt requested),
telex, telecopier or overnight air courier guaranteeing next day delivery, to
the others' address:
If to the Company and/or any Guarantor:
Covanta Energy Corporation
00 Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxx Xxxxxxx, Esq.
If to the Trustee:
U.S. Bank
National Association
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Corporate Trust Services
Facsimile: (000) 000-0000
(b) The Company, any Guarantor or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
(c) All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt is
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
(d) Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed as
delivered to any Person described in TIA ss. 313(c), to the extent required by
the TIA. Failure to mail or deliver a notice or communication to a Holder or any
defect in it will not affect its sufficiency with respect to other Holders.
(e) If a notice or communication is mailed or delivered in the manner
provided above within the time prescribed, it is duly given, whether or not the
addressee receives it.
(f) If the Company mails or delivers a notice or communication to
Holders, it shall mail or deliver a copy to the Trustee and each Agent at the
same time.
Section 13.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
Section 13.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officer's Certificate in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 13.05) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to
the proposed action have been satisfied; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 13.05) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
Section 13.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) must comply with the provisions of TIA ss. 314(e)
and must 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, he or she has
made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or
condition has been satisfied; and
(4) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied; provided that an Opinion of
Counsel can rely as to matters of fact on an Officer's Certificate or a
certificate of a public official.
Section 13.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Trustee shall provide the Company reasonable notice of such rules.
The Registrar or Paying Agent may make reasonable rules and set reasonable
requirements for its functions.
Section 13.07 No Personal Liability of Directors, Officers, Employees
and Stockholders.
No past, present or future director, officer, employee, incorporator,
stockholder, member or agent of the Company or any Guarantor, as such, will have
any liability for any obligations of the Company or the Guarantors under the
Notes, this Indenture, the Subsidiary Guarantees or the Security Documents or
for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the Notes. The waiver may not be effective to waive liabilities under the
federal securities laws.
Section 13.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 13.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 13.10 Successors.
All agreements of the Company in this Indenture and the Notes shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors. All agreements of each Guarantor in this Indenture shall bind
its successors, except as otherwise provided in Section 11.05.
Section 13.11 Severability.
In case any provision in this Indenture or in the Notes is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 13.12 Counterpart Originals.
The parties may sign any number of copies or counterparts of this
Indenture. Each signed copy or counterpart shall be an original, but all of them
together represent the same agreement.
Section 13.13 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
S I G N A T U R E S
Dated as of March [___], 2004
COVANTA ENERGY CORPORATION, a
Delaware Corporation
By:
---------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: President
GUARANTORS LISTED ON SCHEDULE I
By:
---------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: As an authorized officer of
each of the entities referred
to above
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:
---------------------------------------
Name:
Title:
I-1
LA1:1025748.12
[New York #1257570 v1] 1
Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under this Indenture as of
the Issue Date:
1. AMOR 14 Corporation
2. Xxxxxx Mountain Power
3. Covanta Acquisition, Inc.
4. Covanta Alexandria/Arlington, Inc.
5. Covanta Bessemer, Inc.
6. Covanta Bristol, Inc.
7. Covanta Xxxxxxxxxx Environmental Support, Inc.
8. Covanta Energy Americas, Inc.
9. Covanta Energy Construction, Inc.
10. Covanta Energy Group, Inc.
11. Covanta Energy International, Inc.
12. Covanta Energy Resource Corp.
13. Covanta Energy Services, Inc.
14. Covanta Energy West, Inc.
15. Covanta Engineering Services, Inc.
16. Covanta Fairfax, Inc.
17. Covanta Geothermal Operations Holdings, Inc.
18. Covanta Geothermal Operations, Inc.
19. Covanta Haverhill Properties, Inc.
20. Covanta Haverhill, Inc.
21. Covanta Heber Field Energy, Inc.
22. Covanta Hennepin Energy Resource Co., L.P.
23. Covanta Hillsborough, Inc.
24. Covanta Honolulu Resource Recovery Venture
25. Covanta Huntsville, Inc.
26. Covanta Hydro Energy, Inc.
27. Covanta Hydro Operations West, Inc.
28. Covanta Hydro Operations, Inc.
29. Covanta Imperial Power Services, Inc.
30. Covanta Indianapolis, Inc.
31. Covanta Kent, Inc.
32. Covanta Lancaster, Inc.
33. Covanta Xxx, Inc.
34. Covanta Long Island, Inc.
35. Covanta Xxxxxx Land Corp.
36. Covanta Xxxxxx, Inc.
37. Covanta Mid-Conn., Inc.
38. Covanta Xxxxxxxxxx, Inc.
39. Covanta New Martinsville Hydroelectric Corporation
40. Covanta New Martinsville Hydro-Operations Corporation
41. Covanta Oahu Waste Energy Recovery, Inc.
42. Covanta Omega Lease, Inc.
43. Covanta Onondaga Operations, Inc.
44. Covanta Operations of Union LLC
45. Covanta OPW Associates, Inc.
46. Covanta OPWH, Inc.
47. Covanta Pasco, Inc.
48. Covanta Plant Services of New Jersey, Inc.
49. Covanta Power Equity Corporation
50. Covanta Power Pacific, Inc.
51. Covanta Power Plant Operations
52. Covanta Projects of Hawaii, Inc.
53. Covanta Projects, Inc.
54. Covanta RRS Holdings Inc.
55. Covanta Secure Services, Inc.
56. Covanta SIGC Energy, Inc.
57. Covanta SIGC Energy II, Inc.
58. Covanta SIGC Geothermal Operations, Inc.
59. Covanta Stanislaus, Inc.
60. Covanta Systems, LLC
61. Covanta Wallingford Associates, Inc.
62. Covanta Waste to Energy , LLC
63. Covanta Water Holdings, Inc.
64. Covanta Water Systems Inc.
65. Covanta Water Treatment Services Inc.
66. ERC Energy II, Inc.
67. ERC Energy, Inc.
68. Haverhill Power, LLC
69. Heber Field Energy II, Inc.
70. Heber Loan Partners
71. LMI, Inc.
72. Mammoth Geothermal Company
73. Mammoth Power Company
74. Michigan Waste Energy, Inc.
75. Mt. Lassen Power
76. Pacific Geothermal Company
77. Pacific Oroville Power, Inc.
78. Pacific Wood Fuels Company
79. Pacific Wood Services Company
80. Three Mountain Operations, Inc.
81. Three Mountain Power, LLC
EXHIBIT A
[Face of Note]
CUSIP/CINS: 22281N AA 1
ISIN: US22281NAA19
8.25% Senior Secured Notes Due 2011
No. _________ $230,000,000 at Stated Maturity
COVANTA ENERGY CORPORATION
promises to pay to__________________________________ or registered assigns,
the principal sum of TWO HUNDRED THIRTY MILLION DOLLARS
on March 15, 2011.
Interest Payment Dates: March 15 and September 15
Record Dates: March 1 and September 1
Dated: March [___], 2004
COVANTA ENERGY CORPORATION
By:________________________
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
U.S. Bank National Association, as Trustee
By:
----------------------------------------
Authorized Signatory
[Back of Note]
8.25% Senior Secured Notes Due 2011
[Insert the Global Note Legend, if applicable pursuant to the
provisions of the Indenture]
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Covanta Energy Corporation, a Delaware
corporation (the "Company"), promises to pay interest on the principal
amount at Stated Maturity of this Note at a rate equal to 8.25% per
annum plus any additional amounts payable pursuant to Section 4.21 of
the Indenture. The Company shall pay interest semiannually in arrears
on March 15 and September 15 of each year, or if any such day is not a
Business Day, on the next succeeding Business Day (each, an "Interest
Payment Date"). Interest on the Notes shall accrue from the most recent
date to which interest has been paid or, if no interest has been paid,
from the date of issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first
Interest Payment Date shall be September 15, 2004. Interest shall be
computed on the basis of a 360-day year of twelve 30-day months. The
Company will make a current payment of Accreted Value so as to avoid
the application of Section 163(i) of the Code.
(2) METHOD OF PAYMENT. The Company shall pay interest on the
Notes (except defaulted interest) to the Persons who are registered
Holders of Notes at the close of business on the March 1 or September 1
next preceding the Interest Payment Date, even if such Notes are
canceled after such record date and on or before such Interest Payment
Date, except as provided in Section 2.12 of the Indenture with respect
to defaulted interest. The Notes shall be payable as to principal or
Accreted Value, premium, if any, and interest at the office or agency
of the Company maintained for such purpose within the City and State of
New York, or, at the option of the Company, payment of interest may be
made by check mailed to the Holders at their addresses set forth in the
register of Holders; provided that payment by wire transfer of
immediately available funds shall be required with respect to principal
and Accreted Value of and premium, if any, and interest on all Global
Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private
debt.
(3) PAYING AGENT AND REGISTRAR. Initially, U.S. Bank National
Association, the Trustee under the Indenture, shall act as Paying Agent
and Registrar. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an Indenture
dated as of March [___], 2004 (the "Indenture") among the Company, the
Guarantors and the Trustee. The terms of the Notes include those stated
in the Indenture and these made part of the Indenture by reference to
the Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx.
77aaa-77bbbb). The Notes are subject to all such terms, and Holders are
referred to the Indenture and the TIA for a statement of such terms. 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. The Notes are secured obligations of the
Company pursuant to the Security Documents and subject to the terms of
the Intercreditor Agreement.
(5) OPTIONAL REDEMPTION.
(a) At any time after the Issue Date and on or before March
15, 2006, the Company may on any one or more occasions redeem all or a
part of the Notes, upon not less than 30 nor more than 60 days' notice,
at the Accreted Value on the redemption date, plus accrued and unpaid
interest to the redemption date.
(b) At any time after March 15, 2006, the Company may on any
one or more occasions redeem all or a part of the Notes, upon not less
than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of Accreted Value) set forth below, plus
accrued and unpaid interest to the redemption date, if redeemed during
the twelve-month period beginning on March 15 of the years indicated
below:
Year Percentage
---- ----------
2006................................. 104.625%
2007................................. 103.469%
2008................................. 102.313%
2009................................. 101.156%
2010 and thereafter.................. 100.000%
(c) Any redemption pursuant to Section 3.07 of the Indenture
shall be made in accordance with the provisions of Sections 3.01
through 3.06 of the Indenture.
(6) MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
(7) REPURCHASE AT OPTION OF HOLDER.
(a) Subject to the Company's right to redeem the Notes
pursuant to Section 3.07 of the Indenture, upon the occurrence of a
Change of Control, the Company shall be required to make an offer (a
"Change of Control Offer") to each Holder to repurchase all or any part
(in a minimum aggregate principal amount at Stated Maturity of $1,000
or an integral multiple of $1,000) of such Holder's Notes at a purchase
price in cash equal to 101% of the Accreted Value of the Notes
repurchased plus accrued and unpaid interest on the Notes repurchased
to the date of repurchase (the "Change of Control Payment"). Within 10
days following any Change of Control, if the Company has not sent a
redemption notice pursuant to Section 3.03 of the Indenture for all of
the Notes, the Company shall mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sale,
and the aggregate amount of Excess Proceeds exceeds $15.0 million, the
Company shall, subject to the Intercreditor Agreement, commence an
offer to all Holders and all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set forth
in the Indenture with respect to offers to purchase or redeem with the
proceeds of sales of assets (an "Asset Sale Offer") pursuant to Section
4.10 of the Indenture to purchase or redeem the maximum principal
amount at Stated Maturity of Notes and such other pari passu
Indebtedness that may be purchased or redeemed out of the Excess
Proceeds. The offer price for the Notes in any Asset Sale Offer shall
be equal to 100% of the Accreted Value thereof plus accrued and unpaid
interest on the Notes to be purchased to the date fixed for the closing
of such Asset Sale Offer in accordance with the procedures set forth in
the Indenture, and shall be payable in cash. If any Excess Proceeds
remain after consummation of an Asset Sale Offer, the Company and its
Restricted Subsidiaries may use those Excess Proceeds for any purpose
not otherwise prohibited by this Indenture. If the aggregate Accreted
Value of Notes and principal amount of other pari passu Indebtedness
tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and other pari passu
Indebtedness to be purchased or redeemed on a pro rata basis. Upon the
commencement of an Asset Sale Offer, the Company shall send, by first
class mail, a notice to each of the Holders containing all instructions
and materials necessary to enable such Holders to tender Notes pursuant
to the Asset Sale Offer. Holders electing to have a Note purchased
pursuant to any Asset Sale Offer shall be required to surrender the
Note, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Note completed, or transfer by book-entry transfer,
to the Company, a Depositary, if appointed by the Company, or a Paying
Agent at the address specified in the notice at least three days before
the Purchase Date.
(8) NOTICE OF REDEMPTION. Subject to the provisions of
Sections 3.09 and 3.10 of the Indenture, notice of redemption shall be
mailed at least 30 days but not more than 60 days before the redemption
date to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days
prior to a redemption date if the notice is issued in connection with a
defeasance of the Notes or a satisfaction and discharge of the
Indenture pursuant to Articles 8 or 12 of the Indenture. Notes in
denominations larger than $1,000 may be redeemed in part but only in
whole multiples of $1,000, unless all of the Notes held by a Holder are
to be redeemed. On and after the redemption date interest ceases to
accrue on Notes or portions thereof called for redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes
may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company shall not be required to register the
transfer of or to exchange any Note selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in
part. Also, the Company shall not be required to issue, to register the
transfer of or to exchange any Notes (i) during a period beginning at
the opening of business 15 days before the day of any selection of
Notes for redemption under Section 3.02 of the Indenture and ending at
the close of business on the day of selection, or (ii) during a period
beginning at the opening of business 15 days before any Interest
Payment Date and ending at the closing of business on such Interest
Payment Date.
(10) PERSONS DEEMED OWNERS. The Holder of a Note may be
treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions, the Indenture, the Subsidiary Guarantees, the Notes or the
Security Documents may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount at Stated
Maturity of the then outstanding Notes voting as a single class, and
any existing default or compliance with any provision of the Indenture,
the Subsidiary Guarantees, the Notes or the Security Documents may be
waived with the consent of the Holders of a majority in principal
amount at Stated maturity of the then outstanding Notes, voting as a
single class. Without the consent of any Holder of a Note, the
Indenture, the Subsidiary Guarantees, the Notes or the Security
Documents may be amended or supplemented to cure any ambiguity, defect
or inconsistency, to provide for uncertificated Notes in addition to or
in place of certificated Notes, to provide for the assumption of the
Company's obligations to Holders of the Notes in case of a merger or
consolidation or sale of all or substantially all of the Company's
assets, to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that would not adversely affect
the legal rights under the Indenture of any such Holder, to comply with
the requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act, to allow
any Guarantor to execute a supplemental indenture and/or a Subsidiary
Guarantee with respect to the Notes, or if necessary, in connection
with any addition or release of Collateral permitted under the terms of
the Indenture or the Security Documents.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i) the
Company defaults for 30 consecutive days in the payment when due of
interest on the Notes; (ii) the Company defaults in payment when due of
the principal or Accreted Value of, or premium, if any, on the Notes;
(iii) failure by the Company or any of its Restricted Subsidiaries to
comply with its obligations to make any Change of Control Payment
pursuant to Section 4.15 or to comply with the provisions of Section
5.01 of the Indenture; (iv) failure by the Company or any of its
Restricted Subsidiaries for 30 days after written notice from the
Trustee or Holders of at least 25% in aggregate principal amount of the
outstanding Notes to comply with the provisions of any of Section 4.07,
4.09 or 4.10 of the Indenture; (v) failure by the Company or any of its
Restricted Subsidiaries for 60 days after written notice from the
Trustee or Holders of at least 25% in aggregate principal amount of the
outstanding Notes to comply with any of the other agreements in the
Indenture or the Security Documents; (vi) default under any mortgage,
indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness of the Company or
any of its Restricted Subsidiaries whether such Indebtedness now
exists, or is created after the Issue Date, if that default (A) is
caused by a failure to pay principal of or liquidation preference of
such Indebtedness at the final stated maturity thereof (giving effect
to any applicable grace periods and any extensions thereof), (B)
results in the acceleration of such Indebtedness prior to its express
maturity, or (C) results in a requirement that the Company or any of
its Restricted Subsidiaries collateralize any letter of credit
thereunder and the Company or such Restricted Subsidiary fails to
provide the required collateral on the terms and within the times set
forth therein (giving effect to any applicable grace periods and any
extensions thereof), and, in each case, if the principal amount of any
such Indebtedness aggregates $20.0 million or more; (vii) any final
judgment or judgments for the payment of money in an aggregate amount
in excess of $10.0 million (or its foreign currency equivalent at the
time) in excess of amounts which the Company's insurance carriers have
agreed to pay under applicable policies shall have been rendered
against the Company or any Restricted Subsidiary of the Company that is
a Significant Subsidiary and shall not have been waived, satisfied,
bonded or discharged for any period of 60 consecutive days during which
a stay of enforcement is not in effect; (viii) certain events of
bankruptcy or insolvency described in the Indenture with respect to the
Company or any of its Significant Subsidiaries; and (ix) (a) any
Subsidiary Guarantee or any Security Document or any security interest
granted thereby is held in any judicial proceeding to be unenforceable
or invalid, or ceases for any reason to be in full force and effect and
such default continues for ten days after written notice, or (b) the
Company or any Guarantor, or any Person acting on behalf of the Company
or any Guarantor, denies or disaffirms its obligations under any
Subsidiary Guarantee or Security Document. If any Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount at Stated maturity of the then outstanding Notes may
declare all the Notes to be due and payable immediately.
Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, with respect
to the Company or a Significant Subsidiary, all outstanding Notes shall
become due and payable without further action or notice. The amount
payable with respect to principal of the Notes upon any acceleration
shall be the Accreted Value of the Notes as of the date of such
acceleration. Holders may not enforce the Indenture or the Notes except
as provided in the Indenture. Subject to certain limitations, Holders
of a majority in principal amount at Stated Maturity of the then
outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Holders of a majority in aggregate principal amount at
Stated Maturity of the Notes then outstanding by notice to the Trustee
may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of
principal or Accreted Value of or premium or interest on the Notes
(except a rescission of acceleration of the Notes by the Holders of a
majority in aggregate principal amount at Stated Maturity of the then
outstanding Notes). The Company is required to deliver to the Trustee
annually a statement regarding compliance with the Indenture, and the
Company is required, within five Business Days after the date on which
any Officer of the Company becomes aware of any Default or Event of
Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee in its
individual or any other capacity may become the owner or pledgee of
Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee.
However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the
Commission for permission to continue as trustee or resign.
(14) NO RECOURSE AGAINST OTHERS. A past, present or future
director, officer, employee, incorporator or stockholder of the Company
or any Guarantor, as such, shall not have any liability for any
obligations of the Company or Guarantors under the Notes, the
Subsidiary Guarantees, the Indenture or the Security Documents or for
any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration
for the issuance of the Notes.
(15) AUTHENTICATION. This Note shall not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(16) ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder or an assignee, such as: TEN COM (= tenants in
common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants
with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
(17) CUSIP NUMBERS AND ISNs. Pursuant to a recommendation
promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP numbers and ISNs to be printed
on the Notes and the Trustee may use CUSIP numbers and ISNs 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 shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to:
Covanta Energy Corporation
00 Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:_____________________________
(Insert assignee's legal name)
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint
_________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
________________________
Your Signature:_________________________________________
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
____________________________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 3.09 or 4.15 of the Indenture, check the appropriate box
below:
|_| Section 3.09 |_| Section 4.15
If you want to elect to have only part of the principal amount at
Stated Maturity of the Note purchased by the Company pursuant to Section 3.09 or
4.15 of the Indenture, state the principal amount at Stated Maturity you elect
to have purchased:
$_______________________
Date:
____________________
Your Signature:_________________________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:__________________________________
Signature Guarantee*:
___________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount of
this Global Note Signature of
Amount of decrease Amount of increase in following such authorized officer
in Principal Amount Principal Amount of decrease (or of Trustee or
Date of Exchange of this Global Note this Global Note increase) Custodian
------------------- ------------------- ------------------- ------------------- -------------------
EXHIBIT B
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of March [___], 2004 (the "Indenture")
among Covanta Energy Corporation, (the "Company", the Guarantors listed on
Schedule I thereto and U.S. Bank National Association, as trustee (the
"Trustee"), (a) the due and punctual payment of the principal or Accreted Value
of, premium, if any, and interest on the Notes (as defined in the Indenture),
whether at maturity, by acceleration, redemption or otherwise, the due and
punctual payment of interest on overdue principal of and interest on the Notes,
if any, if lawful, 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 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 of Notes and to the Trustee
pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth
in Article 11 of the Indenture and reference is hereby made to the Indenture for
the precise terms of the Subsidiary Guarantee. Each Holder of a Note, by
accepting the same, agrees to and shall be bound by such provisions.
GUARANTORS LISTED ON SCHEDULE I TO THE INDENTURE
By:
-------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: An authorized officer of each of the
entities referred to above
:
EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
___________, 20__, among ___________________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Covanta Energy Corporation (or its permitted
successor), a Delaware corporation (the "Company"), the Company, the other
Guarantors (as defined in the Indenture referred to herein) and U.S. Bank
National Association, as trustee under the indenture referred to below (the
"Trustee").
WITNESSETH
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of March [___], 2004 providing
for the issuance of an aggregate principal amount at Stated Maturity of $230.0
million of 8.25% Senior Secured Notes Due 2011 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Subsidiary Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees as
follows:
(a) Along with all Guarantors named in the Indenture, to
jointly and severally Guarantee to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and
assigns, the Notes or the obligations of the Company hereunder or
thereunder, that:
(i) the principal or Accreted Value of, and premium,
if any, and interest on the Notes shall be promptly paid in
full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal
of and interest on the Notes, if any, if lawful, and all other
obligations of the Company to the Holders or the Trustee
hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and
thereof; and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, that
same shall 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 any
performance so guaranteed for whatever reason, the Guarantors
shall be jointly and severally obligated to pay the same
immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes
or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of
a Guarantor.
(c) The following is hereby waived: diligence, presentment,
demand of 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.
(d) Except as otherwise provided herein or in the Indenture,
this Subsidiary Guarantee shall not be discharged except by complete
performance of the obligations contained in the Notes and the
Indenture, and the Guaranteeing Subsidiary accepts all obligations of a
Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any custodian,
trustee, liquidator or other similar official acting in relation to
either the Company or the Guarantors, any amount paid by either to the
Trustee or such Holder, this Subsidiary Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the
Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article
6 of the Indenture for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and
(y) in the event of any declaration of acceleration of such obligations
as provided in Article 6 of the Indenture, such obligations (whether or
not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Subsidiary Guarantee.
(h) The Guarantors shall have the right to seek contribution
from any nonpaying Guarantor so long as the exercise of such right does
not impair the rights of the Holders under the Subsidiary Guarantee.
(i) Pursuant to Section 11.02 of the Indenture, after giving
effect to any maximum amount and all other contingent and fixed
liabilities that are relevant under any applicable Bankruptcy or
fraudulent conveyance laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such
other Guarantor under Article 11 of the Indenture, this new Subsidiary
Guarantee shall be limited to the maximum amount permissible such that
the obligations of such Guarantor under this Subsidiary Guarantee will
not constitute a fraudulent transfer or conveyance.
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Subsidiary Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Subsidiary Guarantee.
4. RELEASES.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of Capital
Stock of any Guarantor such that it is no longer a Subsidiary of the
Company, in each case to a Person that is not (either before or after
giving effect to such transaction) a Restricted Subsidiary of the
Company, then such Guarantor (in the event of a sale or other
disposition, by way of merger, consolidation or otherwise, of all of
the capital stock of such Guarantor) or the Person acquiring the
property (in the event of a sale or other disposition of all or
substantially all of the assets of such Guarantor) shall be released
and relieved of any obligations under its Subsidiary Guarantee;
provided that the Net Proceeds of such sale or other disposition are
applied in accordance with the applicable provisions of the Indenture,
including without limitation Section 4.10 of the Indenture. Upon
delivery by the Company to the Trustee of an Officer's Certificate and
an Opinion of Counsel to the effect that such sale or other disposition
was made by the Company or a Subsidiary of the Company in accordance
with the provisions of the Indenture, including without limitation
Section 4.10 of the Indenture, the Trustee shall execute any documents
reasonably required in order to evidence the release of any Guarantor
from its obligations under its Subsidiary Guarantee.
(b) Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of
principal or Accreted Value of and interest on the Notes and for the
other obligations of such Guarantor under the Indenture as provided in
Article 11 of the Indenture.
5. NO PERSONAL LIABILITY. No past, present or future director, officer,
employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as
such, shall have any liability for any obligations of the Company or any
Guarantor under the Notes, any Subsidiary Guarantees, the Indenture, this
Supplemental Indenture or the Security Documents or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes. Such waiver may not be
effective to waive liabilities under the federal securities laws.
6. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
7. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
8. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
9. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: , 20
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[GUARANTEEING SUBSIDIARY]
By:
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Name:
Title:
COVANTA ENERGY CORPORATION
By:
----------------------------------
Name:
Title:
[GUARANTORS]
By:
----------------------------------
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
-----------------------------------
Authorized Signatory
