Exhibit 4.1
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CARRIER1 INTERNATIONAL S.A.,
Issuer
and
THE CHASE MANHATTAN BANK,
Trustee
Indenture
Dated as of February 19, 1999
13 1/4% Senior Dollar Notes due 2009
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CROSS-REFERENCE TABLE
TIA Sections Indenture Sections
------------ ------------------
Section 310(a)(1)..................................................... 7.10
(a)(2)..................................................... 7.10
(b)........................................................ 7.03; 7.08
Section 311(a)........................................................ 7.03
(b)........................................................ 7.03
Section 312(a)........................................................ 2.04
(b)........................................................ 11.02
(c)........................................................ 11.02
Section 313(a)........................................................ 7.06
(b)(2)..................................................... 7.07
(c)........................................................ 7.05; 7.06; 11.02
(d)........................................................ 7.06
Section 314(a)........................................................ 7.05; 11.02
(a)(4)..................................................... 4.17; 11.02
(b)........................................................ 10.01
(c)(1)..................................................... 11.03
(c)(2)..................................................... 11.03
(d)........................................................ 10.01
(e)........................................................ 4.17; 11.04
Section 315(a)........................................................ 7.02
(b)........................................................ 7.05; 11.02
(c)........................................................ 7.02
(d)........................................................ 7.02
(e)........................................................ 6.11
Section 316(a)(1)(A).................................................. 6.05
(a)(1)(B).................................................. 6.04
(b)........................................................ 6.07
(c)........................................................ 9.03
Section 317(a)(1)..................................................... 6.08
(a)(2)..................................................... 6.09
(b)........................................................ 2.05
Section 318(a)........................................................ 11.01
(c)........................................................ 11.01
Note: The Cross-Reference Table shall not for any purpose be deemed to be a
part of the Indenture.
TABLE OF CONTENTS*
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
2
SECTION 1.01. DEFINITIONS......................................................................2
SECTION 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT...............................28
SECTION 1.03. RULES OF CONSTRUCTION...........................................................29
ARTICLE TWO
THE NOTES
29
SECTION 2.01. FORM AND DATING.................................................................29
SECTION 2.02. RESTRICTIVE LEGENDS.............................................................31
SECTION 2.03. EXECUTION, AUTHENTICATION AND DENOMINATIONS.....................................34
SECTION 2.04. REGISTRAR AND PAYING AGENT......................................................34
SECTION 2.05. PAYING AGENT TO HOLD MONEY IN TRUST.............................................35
SECTION 2.06. TRANSFER AND EXCHANGE...........................................................36
SECTION 2.07. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES..........................................37
SECTION 2.08. SPECIAL TRANSFER PROVISIONS.....................................................38
SECTION 2.09. REPLACEMENT NOTES...............................................................42
SECTION 2.10. OUTSTANDING NOTES...............................................................42
SECTION 2.11. TEMPORARY NOTES.................................................................43
SECTION 2.12. CANCELLATION....................................................................43
SECTION 2.13. CUSIP NUMBERS...................................................................43
SECTION 2.14. DEFAULTED INTEREST..............................................................43
SECTION 2.15. ISSUANCE OF ADDITIONAL NOTES....................................................44
ARTICLE THREE
REDEMPTION
44
SECTION 3.01. RIGHT OF REDEMPTION.............................................................44
SECTION 3.02. NOTICES TO TRUSTEE..............................................................45
SECTION 3.03. SELECTION OF NOTES TO BE REDEEMED...............................................45
SECTION 3.04. NOTICE OF REDEMPTION............................................................45
SECTION 3.05. EFFECT OF NOTICE OF REDEMPTION..................................................46
SECTION 3.06. DEPOSIT OF REDEMPTION PRICE.....................................................47
SECTION 3.07. PAYMENT OF NOTES CALLED FOR REDEMPTION..........................................47
SECTION 3.08. NOTES REDEEMED IN PART..........................................................47
ARTICLE FOUR
COVENANTS
47
SECTION 4.01. PAYMENT OF NOTES................................................................47
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Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
iii
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.................................................48
SECTION 4.03. LIMITATION ON INDEBTEDNESS......................................................48
SECTION 4.04. LIMITATION ON RESTRICTED PAYMENTS...............................................52
SECTION 4.05. LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
RESTRICTED SUBSIDIARIES.........................................................56
SECTION 4.06. LIMITATION ON THE ISSUANCE AND SALE OF CAPITAL STOCK OF RESTRICTED
SUBSIDIARIES....................................................................58
SECTION 4.07. LIMITATION ON ISSUANCES OF GUARANTEES BY RESTRICTED SUBSIDIARIES................58
SECTION 4.08. LIMITATION ON TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.....................59
SECTION 4.09. LIMITATION ON LIENS.............................................................60
SECTION 4.10. LIMITATION ON SALE-LEASEBACK TRANSACTIONS.......................................61
SECTION 4.11. LIMITATION ON ASSET SALES.......................................................61
SECTION 4.12. REPURCHASE OF NOTES UPON A CHANGE OF CONTROL....................................63
SECTION 4.13. EXISTENCE.......................................................................63
SECTION 4.14. PAYMENT OF TAXES AND OTHER CLAIMS...............................................64
SECTION 4.15. MAINTENANCE OF PROPERTIES AND INSURANCE.........................................64
SECTION 4.16. NOTICE OF DEFAULTS..............................................................65
SECTION 4.17. COMPLIANCE CERTIFICATES.........................................................65
SECTION 4.18. COMMISSION REPORTS AND REPORTS TO HOLDERS.......................................65
SECTION 4.19. WAIVER OF STAY, EXTENSION OR USURY LAWS.........................................66
SECTION 4.20. ADDITIONAL AMOUNTS..............................................................66
ARTICLE FIVE
SUCCESSOR CORPORATION
68
SECTION 5.01. WHEN COMPANY MAY MERGE, ETC.....................................................68
SECTION 5.02. SUCCESSOR SUBSTITUTED...........................................................69
ARTICLE SIX
DEFAULT AND REMEDIES
69
SECTION 6.01. EVENTS OF DEFAULT...............................................................69
SECTION 6.02. ACCELERATION....................................................................71
SECTION 6.03. OTHER REMEDIES..................................................................72
SECTION 6.04. WAIVER OF PAST DEFAULTS.........................................................72
SECTION 6.05. CONTROL BY MAJORITY.............................................................72
SECTION 6.06. LIMITATION ON SUITS.............................................................72
SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT............................................73
SECTION 6.08. COLLECTION SUIT BY TRUSTEE......................................................73
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM................................................74
SECTION 6.10. PRIORITIES......................................................................74
SECTION 6.11. UNDERTAKING FOR COSTS...........................................................74
SECTION 6.12. RESTORATION OF RIGHTS AND REMEDIES..............................................75
SECTION 6.13. RIGHTS AND REMEDIES CUMULATIVE..................................................75
SECTION 6.14. DELAY OR OMISSION NOT WAIVER....................................................75
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ARTICLE SEVEN
TRUSTEE
75
SECTION 7.01. GENERAL.........................................................................75
SECTION 7.02. CERTAIN RIGHTS OF TRUSTEE.......................................................76
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE....................................................77
SECTION 7.04. TRUSTEE'S DISCLAIMER............................................................77
SECTION 7.05. NOTICE OF DEFAULT...............................................................77
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS...................................................77
SECTION 7.07. COMPENSATION AND INDEMNITY......................................................77
SECTION 7.08. REPLACEMENT OF TRUSTEE..........................................................78
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC................................................79
SECTION 7.10. ELIGIBILITY.....................................................................79
SECTION 7.11. MONEY HELD IN TRUST.............................................................80
ARTICLE EIGHT
DISCHARGE OF INDENTURE
80
SECTION 8.01. TERMINATION OF COMPANY'S OBLIGATIONS............................................80
SECTION 8.02. DEFEASANCE AND DISCHARGE OF INDENTURE...........................................81
SECTION 8.03. DEFEASANCE OF CERTAIN OBLIGATIONS...............................................83
SECTION 8.04. APPLICATION OF TRUST MONEY......................................................85
SECTION 8.05. REPAYMENT TO COMPANY............................................................85
SECTION 8.06. REINSTATEMENT...................................................................85
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
86
SECTION 9.01. WITHOUT CONSENT OF HOLDERS......................................................86
SECTION 9.02. WITH CONSENT OF HOLDERS.........................................................86
SECTION 9.03. REVOCATION AND EFFECT OF CONSENT................................................88
SECTION 9.04. NOTATION ON OR EXCHANGE OF NOTES................................................88
SECTION 9.05. TRUSTEE TO SIGN AMENDMENTS, ETC.................................................88
SECTION 9.06. CONFORMITY WITH TRUST INDENTURE ACT.............................................89
ARTICLE TEN
SECURITY
89
SECTION 10.01. SECURITY.......................................................................89
ARTICLE ELEVEN
MISCELLANEOUS
90
SECTION 11.01. TRUST INDENTURE ACT OF 1939....................................................90
SECTION 11.02. NOTICES........................................................................91
SECTION 11.03. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.............................92
SECTION 11.04. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION..................................92
SECTION 11.05. RULES BY TRUSTEE, PAYING AGENT OR REGISTRAR....................................93
SECTION 11.06. PAYMENT DATE OTHER THAN A BUSINESS DAY.........................................93
SECTION 11.07. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS..................................93
SECTION 11.08. NO RECOURSE AGAINST OTHERS.....................................................93
SECTION 11.09. SUCCESSORS.....................................................................94
SECTION 11.10. DUPLICATE ORIGINALS............................................................94
SECTION 11.11. SEPARABILITY...................................................................94
SECTION 11.12. TABLE OF CONTENTS, HEADINGS, ETC...............................................94
SECTION 11.13. SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE. .................94
SECTION 11.14. JUDGMENT CURRENCY..............................................................95
SECTION 11.15. GOVERNING LAW..................................................................95
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EXHIBIT A Form of Note...................................................................A-1
EXHIBIT B Form of Certificate............................................................B-1
EXHIBIT C Form of Certificate to Be Delivered in Connection with
Transfers Pursuant to Non-QIB Accredited Investors..................C-1
EXHIBIT D Form of Certificate to Be Delivered in Connection with
Transfers Pursuant to Regulation S..................................D-1
INDENTURE, dated as of February 19, 1999, between Carrier1 International
S.A., a societe anonyme organized under the laws of the Grand Duchy of
Luxembourg (the "COMPANY"), and The Chase Manhattan Bank, a New York banking
corporation, trustee (the "TRUSTEE").
RECITALS
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance initially of up to $160,000,000 aggregate
principal amount of the Company's 13.25% Senior Dollar Notes 2009 (the "NOTES")
issuable as provided in this Indenture. The Notes will be partially secured
pursuant to the terms of a Pledge Agreement (as defined herein) by Pledged
Securities (as defined herein) as provided by Article Ten of this Indenture. The
Company has agreed to issue and sell a total of 160,000 Units (the "DOLLAR
UNITS"), each of which consists of one Note and one warrant (a "DOLLAR
WARRANT"), each Dollar Warrant initially entitling the holder thereof to
purchase 6.71013 shares of Common Stock, par value $2.00 per share ("COMMON
SHARES"), of the Company, subject to adjustment. The Notes and Dollar Warrants
included in each Dollar Unit will become separately transferable upon the
earliest to occur of (i) the date that is six months following the Closing Date,
(ii) the commencement of the Exchange Offer pursuant to the Registration Rights
Agreement, (iii) the date the Shelf Registration Statement is declared effective
and (iv) a date determined by Xxxxxx Xxxxxxx & Co. Incorporated (the "SEPARATION
DATE"). The Company has also agreed to issue and sell a total of 85,000 Units
(the "EURO UNITS"), each of which consists of one Euro1,000 13.25% Senior Euro
Note due 2009 (a "EURO NOTE") and one warrant (a "EURO WARRANT"), each Euro
Warrant initially entitling the holder thereof to purchase 7.53614 Common
Shares, subject to adjustment. All things necessary to make this Indenture a
valid agreement of the Company, in accordance with its terms, have been done,
and the Company has done all things necessary to make the Notes, when executed
by the Company and authenticated and delivered by the Trustee hereunder and duly
issued by the Company, valid obligations of the Company as hereinafter provided.
This Indenture is subject to, and shall be governed by, the provisions of
the Trust Indenture Act of 1939, as amended, that are required to be a part of
and to govern indentures qualified under the Trust Indenture Act of 1939, as
amended.
AND THIS INDENTURE FURTHER WITNESSETH
For and in consideration of the premises and the purchase of the Notes by
the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders, as follows.
ARTICLE ONE
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DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"ACQUIRED INDEBTEDNESS" means Indebtedness of a Person existing at the time
such Person becomes a Restricted Subsidiary or is merged with or consolidated
with a Restricted Subsidiary or assumed in connection with an Asset Acquisition
by a Restricted Subsidiary and not Incurred in connection with, or in
anticipation of, such Person becoming a Restricted Subsidiary or such Asset
Acquisition.
"ADDITIONAL AMOUNTS" has the meaning provided in Section 4.20.
"ADDITIONAL NOTES" has the meaning provided in Section 2.15.
"ADJUSTED CONSOLIDATED NET INCOME" means, for any period, the aggregate net
income (or loss) of the Company and its Restricted Subsidiaries for such period
determined on a consolidated basis in conformity with GAAP; PROVIDED that the
following items shall be excluded in computing Adjusted Consolidated Net Income
(without duplication):
(i) the net income (or loss) of any Person that is not a Restricted
Subsidiary, except (x) with respect to net income, to the extent of the
amount of dividends or other distributions actually paid to the Company or
any of its Restricted Subsidiaries by such Person during such period and
(y) with respect to net losses, to the extent of the amount of Investments
made by the Company or any Restricted Subsidiary in such Person during such
period;
(ii) solely for the purposes of calculating the amount of Restricted
Payments that may be made pursuant to clause (C) of the first paragraph of
Section 4.04 of this Indenture (and in such case, except to the extent
includable pursuant to clause (i) above), the net income (or loss) of any
Person accrued prior to the date it becomes a Restricted Subsidiary or is
merged into or consolidated with the Company or any of its Restricted
Subsidiaries or all or substantially all of the property and assets of such
Person are acquired by the Company or any of its Restricted Subsidiaries;
(iii) the net income of any Restricted Subsidiary other than a
Permanent Guarantor to the extent that the declaration or payment of
dividends or similar distributions by such Restricted Subsidiary of such
net income is not at the time permitted (after giving effect to any
effective waiver, consent or approval) by the operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to such Restricted Subsidiary;
3
(iv) any gains or losses attributable to Asset Sales (without regard
to clause (c) or (d) in the proviso to the definition thereof);
(v) solely for purposes of calculating the amount of Restricted
Payments that may be made pursuant to clause (C) of the first paragraph of
Section 4.04, any amount paid or accrued as dividends on Preferred Stock of
the Company or any Restricted Subsidiary owned by Persons other than the
Company and any of its Restricted Subsidiaries;
(vi) all extraordinary gains and extraordinary losses or extraordinary
charges;
(vii) any compensation expense to the extent paid or payable solely
with Capital Stock (other than Disqualified Stock) of the Company or any
options, warrants or other rights to acquire Capital Stock (other than
Disqualified Stock) of the Company; and
(viii) the cumulative effect of a change in accounting principles.
"ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS" means the total amount of
assets of the Company and its Restricted Subsidiaries (less applicable
depreciation, amortization and other valuation reserves), except to the extent
resulting from write-ups of capital assets (excluding write-ups in connection
with accounting for acquisitions in conformity with GAAP), after deducting
therefrom (i) all current liabilities of the Company and its Restricted
Subsidiaries (excluding intercompany items) and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles, all as set forth on the most recent quarterly or annual
consolidated balance sheet of the Company and its Restricted Subsidiaries,
prepared in conformity with GAAP and filed with the Commission or provided to
the Trustee pursuant to Section 4.18.
"AFFILIATE" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"AGENT" means any Registrar, Co-Registrar or Paying Agent.
"AGENT MEMBERS" has the meaning provided in Section 2.07(a).
"ASSET ACQUISITION" means (i) an investment by the Company or any of its
Restricted Subsidiaries in any other Person pursuant to which such Person shall
become a Restricted
4
Subsidiary or shall be merged into or consolidated with the Company or any of
its Restricted Subsidiaries; PROVIDED that such Person's primary business is
related, ancillary or complementary to the businesses of the Company and its
Restricted Subsidiaries on the date of such investment, as determined in good
faith by the Board of Directors (whose determination shall be conclusive and
evidenced by a Board Resolution) or (ii) an acquisition by the Company or any of
its Restricted Subsidiaries of the property and assets of any Person other than
the Company or any of its Restricted Subsidiaries that constitute substantially
all of a division or line of business of such Person; PROVIDED that the property
and assets acquired are related, ancillary or complementary to the businesses of
the Company and its Restricted Subsidiaries on the date of such acquisition, as
determined in good faith by the Board of Directors (whose determination shall be
conclusive and evidenced by a Board Resolution).
"ASSET DISPOSITION" means the sale or other disposition by the Company or
any of its Restricted Subsidiaries (other than to the Company or another
Restricted Subsidiary) of (i) all or substantially all of the Capital Stock of
any Restricted Subsidiary or (ii) all or substantially all of the assets that
constitute a division or line of business of the Company or any of its
Restricted Subsidiaries.
"ASSET SALE" means any sale, transfer or other disposition (including by
way of merger, consolidation or sale-leaseback transaction) in one transaction
or a series of related transactions by the Company or any of its Restricted
Subsidiaries to any Person other than the Company or any of its Restricted
Subsidiaries of (i) all or any of the Capital Stock of any Restricted
Subsidiary, (ii) all or substantially all of the property and assets of an
operating unit or business of the Company or any of its Restricted Subsidiaries
or (iii) any other property and assets (other than the Capital Stock of or any
other Investment in an Unrestricted Subsidiary) of the Company or any of its
Restricted Subsidiaries outside the ordinary course of business of the Company
or such Restricted Subsidiary and, in each case, that is not governed by Article
Five of this Indenture; PROVIDED that "Asset Sale" shall not include (a) sales,
transfers or other dispositions of Temporary Cash Investments, inventory,
receivables and other current assets, (b) sales, transfers or other dispositions
of assets constituting a Restricted Payment (or a transaction excluded from the
definition of the term "Restricted Payments") permitted to be made under Section
4.04, (c) sales, transfers or other dispositions of assets with a fair market
value (as certified in an Officers' Certificate) not in excess of $2 million in
any transaction or series of related transactions, or (d) sales or other
dispositions of assets for consideration at least equal to the fair market value
of the assets sold or disposed of, to the extent that the consideration received
would constitute property or assets of the kind described in clause (B) of the
second paragraph of Section 4.11.
"AVERAGE LIFE" means, at any date of determination with respect to any
Indebtedness, the quotient obtained by dividing (i) the sum of the products of
(a) the number of years from such date
5
of determination to the dates of each successive scheduled principal payment
of such Indebtedness and (b) the amount of such principal payment by (ii) the
sum of all such principal payments.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or any
committee of such Board of Directors duly authorized to act under this
Indenture.
"BOARD RESOLUTION" means a copy of a resolution of the Board of Directors
of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such adoption, delivered to the Trustee.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.
"CAPITAL STOCK" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether outstanding on the
Closing Date or issued thereafter, including, without limitation, all Common
Stock and Preferred Stock.
"CAPITALIZED LEASE" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person.
"CAPITALIZED LEASE OBLIGATIONS" means the discounted present value of the
rental obligations under a Capitalized Lease.
"CHANGE OF CONTROL" means such time as (i) a "person" or "group" (within
the meaning of Section 13(d) or 14(d)(2) under the Exchange Act) becomes the
ultimate "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of
more than 35% (50%, if the Permitted Holders hold more than 35% of the voting
power of the Voting Stock of the Company on a fully diluted basis) of the total
voting power of the Voting Stock of the Company on a fully diluted basis and
such ownership represents a greater percentage of the total voting power of the
Voting Stock of the Company, on a fully diluted basis, than is held by Permitted
Holders on such date; or (ii) during any period of two consecutive years
beginning on or after the Closing Date, individuals who at the beginning of such
period were members of the Board of Directors (together with any new directors
whose election by the Board of Directors or whose nomination for election by the
Company's shareholders was approved by a vote of at least a majority of the
members of the Board of Directors then in office who either were members of the
Board of Directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the members of the Board of Directors then in office.
6
"CLOSING DATE" means the date on which the Notes are first issued under
this Indenture.
"COMMISSION" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the TIA, then the body performing such duties at
such time.
"COMMON SHARES" has the meaning provided in the recitals to this Indenture.
"COMMON STOCK" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's equity, other than Preferred Stock of
such Person, whether outstanding on the Closing Date or issued thereafter,
including, without limitation all series and classes of such common stock.
"COMPANY" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article Five of this
Indenture and thereafter means the successor.
"COMPANY ORDER" means a written request or order signed in the name of the
Company by a Senior Officer and another Officer, or by two Senior Officers, and
delivered to the Trustee.
"CONSOLIDATED EBITDA" means, for any period, Adjusted Consolidated Net
Income for such period plus, to the extent such amount was deducted in
calculating such Adjusted Consolidated Net Income, (i) Consolidated Interest
Expense, (ii) provision for all taxes based on income, profits or capital, (iii)
depreciation expense, (iv) amortization expense (including but not limited to
amortization of goodwill and intangibles and amortization and write-off of
financing costs) and (v) all other non-cash items reducing Adjusted Consolidated
Net Income (other than items that will require cash payments and for which an
accrual or reserve is, or is required by GAAP to be, made), less all non-cash
items increasing Adjusted Consolidated Net Income (other than any item
reversing, offsetting or reducing any such accrual or reserve), all as
determined on a consolidated basis for the Company and its Restricted
Subsidiaries in conformity with GAAP; PROVIDED that, if any Restricted
Subsidiary is not a Wholly Owned Restricted Subsidiary, Consolidated EBITDA
shall be reduced (to the extent not otherwise reduced in accordance with GAAP)
by an amount equal to (A) the amount of the Adjusted Consolidated Net Income
attributable to such Restricted Subsidiary multiplied by (B) the percentage
ownership interest in the income of such Restricted Subsidiary not owned on the
last day of such period by the Company or any of its Restricted Subsidiaries.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, the aggregate amount
of interest in respect of Indebtedness (including, without limitation,
amortization of original issue discount
7
on any Indebtedness and the interest portion of any deferred payment obligation,
calculated in accordance with the effective interest method of accounting; all
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing; the net costs associated with
Interest Rate Agreements; and interest on Indebtedness that is Guaranteed or
secured by the Company or any of its Restricted Subsidiaries) and the interest
component of Capitalized Lease Obligations paid, accrued or scheduled to be paid
or to be accrued by the Company and its Restricted Subsidiaries during such
period, all as determined on a consolidated basis (without taking into account
Unrestricted Subsidiaries) in conformity with GAAP.
"CONSOLIDATED LEVERAGE RATIO" means, on any Transaction Date, the ratio of
(i) the aggregate amount of Indebtedness of the Company and its Restricted
Subsidiaries on a consolidated basis outstanding on such Transaction Date to
(ii) four times the amount of Consolidated EBITDA for the then most recent
fiscal quarter for which financial statements of the Company have been filed
with the Commission or provided to the Trustee pursuant to Section 4.18 of this
Indenture (such quarter being the "QUARTER"); PROVIDED that, in making the
foregoing calculation, (A) PRO FORMA effect shall be given, in calculating the
amount of Indebtedness outstanding on the Transaction Date, to any Indebtedness
to be Incurred on the Transaction Date, or to be repaid, repurchased, redeemed
or otherwise retired or discharged on the Transaction Date; (B) PRO FORMA effect
shall be given to Asset Dispositions and Asset Acquisitions (including giving
PRO FORMA effect to the application of proceeds of any Asset Disposition) that
occur from the beginning of the Quarter through the Transaction Date (the
"Reference Period"), as if they had occurred and such proceeds had been applied
on the first day of such Reference Period; and (C) PRO FORMA effect shall be
given to asset dispositions and asset acquisitions (including giving PRO FORMA
effect to the application of proceeds of any asset disposition) that have been
made by any Person that has become a Restricted Subsidiary or has been merged
with or into, or consolidated with, the Company or any Restricted Subsidiary
during such Reference Period and that would have constituted Asset Dispositions
or Asset Acquisitions had such transactions occurred when such Person was a
Restricted Subsidiary as if such asset dispositions or asset acquisitions were
Asset Dispositions or Asset Acquisitions that occurred on the first day of such
Reference Period; PROVIDED that to the extent that clause (B) or (C) of this
sentence requires that PRO FORMA effect be given to an Asset Acquisition or
Asset Disposition, such PRO FORMA calculation shall be based upon the full
fiscal quarter immediately preceding the Transaction Date of the Person, or
division or line of business of the Person, that is acquired or disposed of for
which financial information is available.
"CONSOLIDATED NET WORTH" means, at any date of determination, shareholders'
equity (plus, to the extent not otherwise included, Preferred Stock of the
Company) as set forth on the most recently available quarterly or annual
consolidated balance sheet of the Company and its Restricted Subsidiaries (which
shall be as of a date not more than 90 days prior to the date of such
computation, and which shall not take into account Unrestricted Subsidiaries),
less any amounts attributable to Disqualified Stock or any equity security
convertible into or exchangeable for
8
Indebtedness, the cost of treasury stock and the principal amount of any
promissory notes receivable from the sale of the Capital Stock of the Company or
any of its Restricted Subsidiaries, each item to be determined in conformity
with GAAP (excluding the effects of foreign currency exchange adjustments under
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 52).
"CORPORATE TRUST OFFICE" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; Attention: Capital
Markets Fiduciary Services.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement.
"DEFAULT" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"DEPOSITARY" means The Depository Trust Company, its nominees, and their
respective successors.
"DISINTERESTED MEMBER" means, with respect to any transaction, a member of
the Board of Directors having no material financial interest in or with respect
to such transaction. A member of the Board of Directors shall not be deemed to
have such a financial interest solely by reason of such member's holding Capital
Stock of the Company or any parent thereof or any options, warrants or other
rights in respect of such Capital Stock.
"DISQUALIFIED STOCK" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Notes, (ii) redeemable at the option of the holder of
such class or series of Capital Stock at any time prior to the Stated Maturity
of the Notes or (iii) convertible into or exchangeable for Capital Stock
referred to in clause (i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Notes; PROVIDED that any Capital
Stock that would not constitute Disqualified Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the Stated Maturity of the Notes shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are no more favorable to the holders of such
Capital Stock than the provisions contained in Sections 4.11 and 4.12 of this
Indenture and such Capital Stock, or the agreements or instruments governing the
redemption rights thereof, specifically provides that such Person will not
repurchase or redeem any such stock pursuant to such provision prior to the
Company's repurchase of such Notes as are required to be repurchased pursuant to
Sections 4.11 and 4.12 of this Indenture.
9
"DOLLAR UNITS" has the meaning provided in the recitals to this Indenture.
"DOLLAR WARRANT" has the meaning provided in the recitals to this
Indenture.
"DOLLAR WARRANT AGREEMENT" means the Warrant Agreement dated as of the
Closing Date between the Company and The Chase Manhattan Bank, warrant agent,
relating to the Dollar Warrants, as such agreement may be amended or modified
from time to time.
"EURO NOTE" has the meaning provided in the recitals to this Indenture (and
includes the Exchange Notes as defined in the Euro Notes Indenture).
"EURO NOTES INDENTURE" means the Indenture dated as of the Closing Date
between the Company, The Chase Manhattan Bank, trustee, relating to the Euro
Notes, as such indenture may be amended or supplemented from time to time.
"EURO UNITS" has the meaning provided in the recitals to this Indenture.
"EURO WARRANT" has the meaning provided in the recitals to this Indenture.
"EURO WARRANT AGREEMENT" means the Warrant Agreement dated as of the
Closing Date between the Company and The Chase Manhattan Bank, warrant agent,
relating to the Euro Warrants, as such agreement may be amended or modified from
time to time.
"EUROPEAN UNION" means the European Union, including the countries of
Austria, Belgium, Denmark, France, Finland, Germany, Greece, Ireland, Italy,
Luxembourg, The Netherlands, Portugal, Spain, Sweden, and the United Kingdom; as
well as any other country which at the time of determination is a member of the
European Union.
"EVENT OF DEFAULT" has the meaning provided in Section 6.01.
"EXCESS PROCEEDS" has the meaning provided in Section 4.11.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
"EXCHANGE NOTES" means any securities of the Company containing terms
substantially identical to the Notes (except that (i) such Exchange Notes shall
be registered under the Securities Act and shall not bear the Private Placement
Legend and (ii) certain provisions relating to an increase in the stated rate of
interest thereon shall be eliminated) that are issued and exchanged for the
Notes pursuant to the Registration Rights Agreement and this Indenture (or in
the case of Additional Notes, any registration rights agreement related
thereto).
10
"FAIR MARKET VALUE" means the price that would be paid in an arm's-length
transaction between an informed and willing seller under no compulsion to sell
and an informed and willing buyer under no compulsion to buy, as determined in
good faith by the Board of Directors, whose determination shall be conclusive if
evidenced by a Board Resolution; PROVIDED that for purposes of clause (viii) of
the second paragraph of Section 4.03, (x) the fair market value of any security
registered under the Exchange Act shall be the average of the closing prices,
regular way, of such security for the 20 consecutive trading days immediately
preceding the sale of Capital Stock and (y) in the event the aggregate fair
market value of any other property (other than cash or cash equivalents)
received by the Company exceeds $10 million, the fair market value of such
property shall be determined by a nationally recognized investment banking or
appraisal firm and set forth in their written opinion which shall be delivered
to the Trustee.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect as of the Closing Date, including, without limitation,
those 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 approved by a significant segment of the
accounting profession; PROVIDED, HOWEVER, that all reports and other financial
information provided by the Company to the Holders of the Notes or the Trustee
shall be prepared in accordance with GAAP as in effect from time to time. All
ratios and computations contained or referred to in this Indenture shall be
computed in conformity with GAAP applied on a consistent basis, except that
calculations made for purposes of determining compliance with the terms of the
covenants and with other provisions of this Indenture shall be made without
giving effect to (i) the amortization or write-off of any expenses incurred in
connection with the offering of the Units and (ii) the amortization of any
amounts required or permitted by Accounting Principles Board Opinion Nos. 16 and
17.
"GERMAN NETWORK" means the fiber optic network to be built in Germany by
the Company or any of its Restricted Subsidiaries with affiliates of Viatel,
Inc. and Metromedia Fiber Network Inc. contemplated by the letter of intent
dated August 20, 1998.
"GERMAN NETWORK L/C" means a letter of credit in an amount not to exceed
$75 million issued to secure obligations of the Company or any of its Restricted
Subsidiaries with respect to the German Network.
"GLOBAL NOTES" has the meaning provided in Section 2.01.
"GUARANTEE" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness of any other Person and,
without limiting the generality of the foregoing, any such obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such
11
Indebtedness of such other Person (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase assets, goods,
securities or services (unless such purchase arrangements are on arm's-length
terms and are entered into in the ordinary course of business), to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for purposes of assuring in any other manner the obligee of such Indebtedness of
the payment thereof or to protect such obligee against loss in respect thereof
(in whole or in part); PROVIDED that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"GUARANTEED INDEBTEDNESS" has the meaning provided in Section 4.07.
"HOLDER" or "NOTEHOLDER" means the registered holder of any Note.
"INCUR" means, with respect to any Indebtedness, to incur, create, issue,
assume, enter into any Guarantee of or otherwise become liable for or with
respect to, or become responsible for, the payment of, contingently or
otherwise, such Indebtedness, including an "Incurrence" by means of the
acquisition of more than 50% of the Capital Stock of any Person; PROVIDED that
neither the accrual of interest nor the accretion of original issue discount
shall be considered an Incurrence of Indebtedness.
"INDEBTEDNESS" means, with respect to any Person at any date of
determination (without duplication):
(i) all indebtedness of such Person for borrowed money;
(ii) all principal obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(iii) all reimbursement obligations of such Person in respect of
letters of credit or other similar instruments (excluding obligations with
respect to letters of credit (including trade letters of credit) or other
similar instruments securing obligations (other than obligations described
in (i) or (ii) above or (v), (vi) or (vii) below) entered into in the
ordinary course of business of such Person to the extent such letters of
credit are not properly honored and drawn upon or, if properly honored and
drawn upon, to the extent such drawing is reimbursed no later than the
third Business Day following receipt by such Person of a demand for
reimbursement);
(iv) all obligations of such Person to pay the deferred and unpaid
purchase price of property or services, which purchase price is due more
than six months after the date of placing such property in service or
taking delivery and title thereto or the completion of such services,
except Trade Payables;
12
(v) all Capitalized Lease Obligations of such Person;
(vi) 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 that the amount of such 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;
(vii) all Indebtedness of other Persons Guaranteed by such Person;
PROVIDED that the amount of Indebtedness of such Person shall be the lesser
of (A) the amount Guaranteed and (B) the amount of such Indebtedness of
such other Persons; and
(viii) to the extent not otherwise included in this definition,
obligations under Currency Agreements and Interest Rate Agreements, except
if such agreements (a) are designed solely to protect the Company or its
Restricted Subsidiaries against fluctuations in foreign currency exchange
rates or interest rates and (b) do not increase the Indebtedness of the
obligor outstanding at any time other than as a result of fluctuations in
foreign currency exchange rates or interest rates or by reason of fees,
indemnities and compensation payable thereunder.
The amount of Indebtedness of any Person as described above at any date
shall be the outstanding balance at such date of all unconditional obligations
as described above and, with respect to contingent obligations as described
above, the maximum liability upon the occurrence of the contingency giving rise
to the obligation, PROVIDED (A) that the amount outstanding at any time of any
Indebtedness issued with original issue discount is the face amount of such
Indebtedness less the remaining unamortized portion of the original issue
discount of such Indebtedness at the time of its issuance as determined in
conformity with GAAP, (B) that obligations for money borrowed and set aside at
the time of the Incurrence of any Indebtedness in order to prefund the payment
of the interest on such Indebtedness shall not be deemed to be "Indebtedness" so
long as such money is held to secure the payment of such interest, (C) that the
amount of an obligation in respect of a letter of credit or other similar
instrument is the aggregate undrawn and unexpired amount thereof plus the
aggregate amount of drawings properly honored thereunder that have not then been
reimbursed, and (D) that "Indebtedness" shall not include any liability for
federal, state, local or other taxes. Indebtedness shall not be deemed to
include any obligation arising from the honoring of a check, draft or similar
instrument drawn against insufficient funds, PROVIDED that such obligation is
extinguished within five business days of its Incurrence.
13
"INDENTURE" means this Indenture as originally executed or as it may be
amended or supplemented from time to time by one or more indentures supplemental
to this Indenture entered into pursuant to the applicable provisions of this
Indenture.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"INTEREST PAYMENT DATE" means each semiannual interest payment date on
February 15 and August 15 of each year, commencing August 15, 1999.
"INTEREST RATE AGREEMENT" means any interest rate protection agreement,
interest rate future agreement, interest rate option agreement, interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement,
interest rate hedge agreement, option or future contract or other similar
agreement or arrangement.
"INVESTMENT" in any Person means any direct or indirect advance, loan or
other extension of credit (including, without limitation, by way of Guarantee or
similar arrangement; but excluding advances, loans or other extensions of credit
to customers or suppliers in the ordinary course of business to the extent
required by GAAP to be recorded as accounts receivable, prepaid expenses or
deposits on the balance sheet of the Company or its Restricted Subsidiaries) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, bonds, notes,
debentures or other similar instruments issued by, such Person and shall include
(i) the designation of a Restricted Subsidiary as an Unrestricted Subsidiary and
(ii) the fair market value of the Capital Stock (or any other Investment), held
by the Company or any of its Restricted Subsidiaries, of (or in) any Person that
has ceased to be a Restricted Subsidiary, including, without limitation, by
reason of any transaction permitted by clause (iii) of Section 4.06; PROVIDED
that the fair market value of the Investment remaining in any Person that has
ceased to be a Restricted Subsidiary shall not exceed the aggregate amount of
Investments previously made in such Person valued at the time such Investments
were made less the net reduction of such Investments. For purposes of the
definition of "Unrestricted Subsidiary" and Section 4.04 of this Indenture, (i)
"Investment" shall include the fair market value of the assets (net of
liabilities (other than liabilities to the Company or any of its Restricted
Subsidiaries)) of any Restricted Subsidiary at the time that such Restricted
Subsidiary is designated an Unrestricted Subsidiary, (ii) the fair market value
of the assets (net of liabilities (other than liabilities to the Company or any
of its Restricted Subsidiaries)) of any Unrestricted Subsidiary at the time that
such Unrestricted Subsidiary is designated a Restricted Subsidiary shall be
considered a reduction in outstanding Investments and (iii) any property
transferred to or from an Unrestricted Subsidiary shall be valued at its fair
market value at the time of such transfer.
"JUDGMENT CURRENCY" has the meaning provided in Section 11.14.
14
"LIEN" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including, without limitation, any conditional sale or other
title retention agreement or lease in the nature thereof or any agreement to
give any security interest).
"MANAGEMENT INVESTOR" means any officer, director, employee or other member
of the management of the Company or any of its Subsidiaries, or family members
or relatives thereof, or trusts or partnerships for the benefit of any of the
foregoing, or any of their heirs, executors, successors and legal
representatives.
"MOODY'S" means Xxxxx'x Investors Service, Inc. and its successors.
"NET CASH PROCEEDS" means, (a) with respect to any Asset Sale, the proceeds
of such Asset Sale when received in the form of cash or cash equivalents,
including payments in respect of deferred payment obligations (to the extent
corresponding to the principal, but not interest, component thereof) when
received in the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to the Company or any Restricted
Subsidiary) and proceeds from the conversion of other property received when
converted to cash or cash equivalents, net of (i) brokerage commissions and
other fees and expenses (including fees and expenses of counsel and investment
bankers) related to such Asset Sale, (ii) provisions for all taxes (whether or
not such taxes will actually be paid or are payable) as a result of such Asset
Sale without regard to the consolidated results of operations of the Company and
its Restricted Subsidiaries, taken as a whole, including as a consequence of any
transfer of funds in connection with the application thereof in accordance with
Section 4.11, (iii) payments made, or required to be made, to repay Indebtedness
or any other obligation outstanding at the time of such Asset Sale that either
(A) is secured by a Lien on the property or assets sold or (B) is required to be
paid as a result of such Asset Sale, (iv) all distributions and other payments
required to be made to minority interest holders in a Restricted Subsidiary or
joint venture as a result of such Asset Sale by or of such Restricted Subsidiary
or joint venture, or to any other Person (other than the Company or a Restricted
Subsidiary) owning a beneficial interest in the assets disposed of in such Asset
Sale, and (v) appropriate amounts to be provided by the Company or any
Restricted Subsidiary as a reserve against any liabilities or obligations
associated with such Asset Sale, including, without limitation, pension and
other post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as determined in conformity with GAAP and (b) with respect
to any issuance or sale of Capital Stock, the proceeds of such issuance or sale
in the form of cash or cash equivalents, including payments in respect of
deferred payment obligations (to the extent corresponding to the principal, but
not interest, component thereof) when received in the form of cash or cash
equivalents (except to the extent such obligations are financed or sold with
recourse to the Company or any Restricted Subsidiary) and proceeds from the
conversion of other property received when converted to cash or cash
equivalents, net of attorney's fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
15
other fees incurred in connection with such issuance or sale and net of taxes
paid or payable as a result thereof. In the event that any consideration for any
Asset Sale that would otherwise constitute Net Cash Proceeds is required to be
held in escrow pending determination of whether a purchase price adjustment,
indemnification or other payment or other similar adjustment will be made, such
consideration will become Net Cash Proceeds only when and to the extent released
from escrow to the Company or a Restricted Subsidiary.
"NON-U.S. PERSON" means a person who is not a "U.S. person" (as defined in
Regulation S).
"NOTES" means any of the securities, as defined in the first paragraph of
the recitals hereof, that are authenticated and delivered under this Indenture.
For all purposes of this Indenture, the term "Notes" shall include the Notes
initially issued on the Closing Date, any Exchange Notes to be issued and
exchanged for any Notes pursuant to the Registration Rights Agreement and this
Indenture, and any Additional Notes. For purposes of this Indenture, all Notes
shall vote together as one series of Notes under this Indenture.
"NOTES GUARANTEE" means any Guarantee of the Company's obligations with
respect to the Notes by a Permanent Guarantor or any Subsidiary Guarantor.
"OFFER TO PURCHASE" means an offer to purchase Notes by the Company from
the Holders commenced by mailing a notice to the Trustee and providing notice to
each Holder stating:
(i) the covenant pursuant to which the offer is being made and that
all Notes validly tendered will be accepted for payment on a pro rata
basis;
(ii) the purchase price and the date of purchase (which shall be a
Business Day no earlier than 30 days nor later than 60 days from the date
such notice is mailed) (the "Payment Date");
(iii) that any Note not tendered will continue to accrue interest
pursuant to its terms;
(iv) that, unless the Company defaults in the payment of the purchase
price, any Note accepted for payment pursuant to the Offer to Purchase
shall cease to accrue interest on and after the Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the
Offer to Purchase will be required to surrender the Note, together with the
form entitled "Option of the Holder to Elect Purchase" on the reverse side
of the Note completed, to the Paying
16
Agent at the address specified in the notice prior to the close of business
on the Business Day immediately preceding the Payment Date;
(vi) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a telegram, facsimile
transmission or letter setting forth the name of such Holder, the principal
amount of Notes delivered for purchase and a statement that such Holder is
withdrawing his election to have such Notes purchased; and
(vii) that Holders whose Notes are being purchased only in part will
be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered; PROVIDED that each Note purchased and each new Note
issued shall be in a principal amount of $1,000 or an integral multiple
thereof.
On the Payment Date, the Company shall (i) accept for payment on a pro rata
basis Notes or portions thereof tendered pursuant to an Offer to Purchase; (ii)
deposit with the Paying Agent money sufficient to pay the purchase price of all
Notes or portions thereof so accepted; and (iii) deliver, or cause to be
delivered, to the Trustee all Notes or portions thereof so accepted together
with an Officers' Certificate specifying the Notes or portions thereof accepted
for payment by the Company. The Paying Agent shall promptly mail to the Holders
of Notes so accepted payment in an amount equal to the purchase price, and the
Trustee shall promptly authenticate and mail to such Holders a new Note equal in
principal amount to any unpurchased portion of the Note surrendered; PROVIDED
that each Note purchased and each new Note issued shall be in a principal amount
of $1,000 or an integral multiple thereof. The Company will publicly announce
the results of an Offer to Purchase as soon as practicable after the Payment
Date. The Trustee shall act as the Paying Agent for an Offer to Purchase. The
Company will comply with Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such laws and
regulations are applicable, in the event that the Company is required to
repurchase Notes pursuant to an Offer to Purchase. To the extent the provisions
of any such laws or regulations conflict with the provisions of this Indenture,
the Company will comply with such laws and regulations and will not be deemed to
have breached its obligations under this Indenture by virtue thereof.
"OFFICER" means, with respect to the Company, any of (i) a member of the
Board of Directors, or the Chairman, the President, the Chief Executive Officer,
a Vice President, the Chief Operating Officer or the Chief Financial Officer of
the Company or any officer of any Restricted Subsidiary acting as chief
executive officer, chief operating officer, chief accounting officer or chief
financial officer of the Company (any Officer or other person described in this
clause (i), a "Senior Officer"), (ii) the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the Company or Carrier1 International
GmbH, or any officer of any Restricted Subsidiary acting as treasurer of the
Company, and (iii) any officer or employee of the
17
Company or any Restricted Subsidiary designated by the Board of Directors as an
Officer for purposes of this Indenture.
"OFFICERS' CERTIFICATE" means a certificate signed by one Senior Officer
and one other Officer or two Senior Officers. Each Officers' Certificate (other
than certificates provided pursuant to TIA Section 314(a)(4)) shall include the
statements provided for in TIA Section 314(e) to the extent required thereby.
"OFFSHORE GLOBAL NOTES" has the meaning provided in Section 2.01.
"OFFSHORE PHYSICAL NOTES" has the meaning provided in Section 2.01.
"OPINION OF COUNSEL" means a written opinion signed by legal counsel, who
may be an employee of or counsel to the Company or Carrier1 International GmbH,
that meets the requirements of Section 11.04 hereof. Each such Opinion of
Counsel shall include the statements provided for in TIA Section 314(e) to the
extent required thereby.
"PARI PASSU INDEBTEDNESS" has the meaning provided in Section 4.11.
"PAYING AGENT" has the meaning provided in Section 2.04, except that, for
the purposes of Article Eight, the Paying Agent shall not be the Company or a
Subsidiary of the Company or an Affiliate of any of them. The term "Paying
Agent" includes any additional Paying Agent.
"PAYMENT DATE" has the meaning provided in the definition of Offer to
Purchase.
"PERMANENT GUARANTOR" means a Restricted Subsidiary that irrevocably
guarantees the payment of the Notes on an unsubordinated basis; provided that
such guarantee may provide that it shall be automatically and unconditionally
released and discharged upon (i) any sale, exchange or transfer (including by
way of merger or consolidation), to any Person not an Affiliate of the Company,
of all of the Company's and each Restricted Subsidiary's Capital Stock in, or
all or substantially all the assets of, such Restricted Subsidiary (which sale,
exchange, transfer or other transaction is not prohibited by this Indenture),
(ii) the legal or covenant defeasance of the Notes or satisfaction and discharge
of this Indenture, subject to customary contingent reinstatement provisions or
(iii) upon the merger or consolidation of the Permanent Guarantor with and into
the Company or another Permanent Guarantor that is the surviving Person in such
merger or consolidation.
"PERMANENT OFFSHORE GLOBAL NOTES" has the meaning provided in Section 2.01.
"PERMITTED HOLDER" means any of the following: any of Providence Equity
Partners L.P., Providence Equity Partners II L.P., Providence Equity Partners
III L.P., Primus Capital Fund IV
18
Limited Partnership and Primus Executive Fund Limited Partnership and any of the
respective Affiliates or successors of the foregoing.
"PERMITTED INVESTMENT" means:
(i) an Investment in the Company (including the Notes or the Euro
Notes) or a Restricted Subsidiary or a Person which will, upon the making
of such Investment, become a Restricted Subsidiary or be merged or
consolidated with or into, or transfer or convey all or substantially all
its assets to, the Company or a Restricted Subsidiary; PROVIDED that such
Person's primary business is related, ancillary or complementary to the
businesses of the Company and its Restricted Subsidiaries on the date of
such Investment;
(ii) Temporary Cash Investments;
(iii) commissions, payroll, travel and similar advances to cover
matters that are expected at the time of such advances ultimately to be
treated as expenses in accordance with GAAP;
(iv) stock, obligations, securities or other Investments received (a)
in satisfaction of judgments or (b) in settlement of debts, or as a result
of foreclosure, perfection or enforcement of any Lien, in each case under
this clause (b) arising in the ordinary course of business and not in
contemplation of the acquisition of such stock, obligations, securities or
other Investments;
(v) Investments in negotiable instruments held for collection, lease,
utility and worker's compensation, performance and other similar pledges or
deposits and other pledges or deposits permitted under Section 4.09;
(vi) obligations under Interest Rate Agreements and Currency
Agreements designed solely to protect the Company or its Restricted
Subsidiaries against fluctuations in interest rates or foreign currency
exchange rates;
(vii) Investments in a joint venture to cover the Company's portion of
the cost (including the cost of design, development, acquisition,
construction, installation and improvement) of building a
telecommunications network (or network segment) in Europe, provided that
the Company or any of its Restricted Subsidiaries will directly own their
portion of such network (or network segment); and Investments in joint
ventures to acquire or maintain or otherwise relating to any rights-of-way,
wayleaves, governmental approvals, licenses, franchises or concessions
relating to any such network (or network segment);
19
(viii) Investments in any Person in an aggregate amount not to exceed
25% of any gains (net of any losses) attributable to Asset Sales after the
Closing Date and prior to the date of such Investment; and
(ix) loans or advances to directors, officers or employees of the
Company or any Restricted Subsidiary that do not in the aggregate exceed $3
million at any time outstanding.
"PERMITTED JOINT VENTURE" means any joint venture between the Company or
any Restricted Subsidiary and any Person other than a Subsidiary, engaged in the
provision or sale of telecommunications services, or in any other business that
is related, ancillary or complementary to the provision or sale of
telecommunications services, as determined in good faith by the Board of
Directors (whose determination shall be conclusive if evidenced by a Board
Resolution); PROVIDED that prior to making any Investment in such a Person, the
Company's Board of Directors shall have determined that such Investment fits the
Company's strategic plan and is on terms that are fair and reasonable to the
Company.
"PERMITTED LIENS" means:
(i) Liens for taxes, assessments, governmental charges or claims not
yet delinquent, or that in the aggregate are not material, or that are
being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted and for which a reserve or other
appropriate provision, if any, as shall be required in conformity with GAAP
shall have been made;
(ii) statutory and common law Liens of landlords, carriers,
warehousemen, mechanics, suppliers, materialmen or repairmen or other
similar Liens arising in the ordinary course of business and with respect
to amounts not yet delinquent or that have been bonded or are being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted and for which a reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have
been made;
(iii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security and other similar legislation or other
insurance-related obligations (including, without limitation, pledges or
deposits securing liability to insurance carriers under insurance or
self-insurance arrangements);
(iv) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, licenses, obligations for utilities, statutory or
regulatory obligations, bankers' acceptances, letters of credit, surety and
appeal bonds, government or other contracts,
20
completion guarantees, performance and return-of-money bonds and other
obligations of a similar nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money);
(v) easements, rights-of-way, municipal and zoning ordinances, utility
agreements, reservations, encroachments, restrictions and similar charges,
encumbrances, title defects or other irregularities that do not materially
interfere with the ordinary course of business of the Company or any of its
Restricted Subsidiaries;
(vi) Liens (including extensions, renewals and replacements thereof)
upon real or personal property or assets (including leases on an
indefeasible right-to-use basis); PROVIDED that (a) such Lien is created
solely for the purpose of securing Indebtedness Incurred, in accordance
with Section 4.03, to finance or refinance the cost (including the cost of
design, development, acquisition, construction, installation, improvement,
transportation or integration) of the item of property or assets subject
thereto and the original such Lien is created prior to, at the time of or
within one year after the later of the acquisition, the completion of
construction or the commencement of full operation of such property or
assets, (b) the principal amount of the Indebtedness secured by such Lien
does not exceed 100% of such cost and (c) any such Lien shall not extend to
or cover any property or assets other than such item of property or assets
and any improvements, accessions or proceeds in respect of such item;
(vii) leases, subleases, licenses or sublicenses granted to others
that do not materially interfere with the ordinary course of business of
the Company and its Restricted Subsidiaries, taken as a whole;
(viii) Liens encumbering property or assets under construction (and
related rights) in favor of a contractor or developer, or arising from
progress or partial payments by a customer of the Company or its Restricted
Subsidiaries relating to such property or assets;
(ix) any interest or title of a lessor in the property subject to any
Capitalized Lease or operating lease;
(x) Liens arising from filing Uniform Commercial Code financing
statements regarding leases;
(xi) Liens (including extensions, renewals and replacements thereof)
on property or assets of, or on shares of Capital Stock or Indebtedness of,
any Person existing (in the case of the original such Lien) at the time
such Person becomes, or becomes a part of, any Restricted Subsidiary;
PROVIDED that such Liens do not extend to or cover any property or assets
of the Company or any Restricted Subsidiary other than the property,
assets, Capital
21
Stock or Indebtedness so acquired (plus improvements, accessions or
proceeds (including dividends or distributions) in respect thereof);
(xii) Liens in favor of the Company or any Restricted Subsidiary;
(xiii) Liens arising from the rendering of a final judgment, order,
decree or award against the Company or any Restricted Subsidiary that does
not give rise to an Event of Default;
(xiv) Liens securing reimbursement obligations with respect to letters
of credit that encumber documents and other property relating to such
letters of credit and the products and proceeds thereof;
(xv) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(xvi) Liens encumbering customary initial deposits and margin
deposits, and other Liens that are within the general parameters customary
in the industry and incurred in the ordinary course of business, in each
case, securing Indebtedness or other obligations under Interest Rate
Agreements and Currency Agreements and forward contracts, options, future
contracts, futures options or similar agreements or arrangements designed
solely to protect the Company or any of its Restricted Subsidiaries from
fluctuations in interest rates, currencies or the price of commodities;
(xvii) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by
the Company or any of its Restricted Subsidiaries in the ordinary course of
business;
(xviii) Liens on or sales or transfers of receivables (including
related rights);
(xix) Liens that secure Indebtedness or other obligations with an
aggregate principal amount not in excess of $5 million at any time
outstanding;
(xx) Liens placed by any third party on property over which the
Company or any Restricted Subsidiary has easement or other rights or on any
leased property, or arising by reason of subordination or similar
agreements relating thereto; and Liens arising by reason of any
condemnation or eminent domain proceedings;
(xxi) Liens on Capital Stock or other securities of an Unrestricted
Subsidiary that secure Indebtedness or other obligations of such
Unrestricted Subsidiary;
22
(xxii) any encumbrance or restriction (including, but not limited to,
put and call agreements) with respect to Capital Stock of any joint venture
or similar arrangement pursuant to any joint venture or similar agreement;
(xxiii) Liens (including extensions, renewals and replacements
thereof) on property or assets acquired by the Company or any Restricted
Subsidiary; PROVIDED that (a) such Liens were not created in connection
with or in anticipation of such acquisition, (b) such Liens do not secure
Indebtedness other than Indebtedness assumed in connection with such
acquisition, and (c) such Liens do not extend to or cover any property or
assets of the Company or any Restricted Subsidiary other than the property
or assets so acquired (plus improvements, accessions or proceeds in respect
thereof); and
(xxiv) Liens on cash set aside at the time of the Incurrence of any
Indebtedness, or government securities purchased with such cash, in either
case to the extent that such cash or government securities prefund the
payment of interest on such Indebtedness and are held in an escrow account
or similar arrangement to be applied for such purpose.
"PHYSICAL NOTES" has the meaning provided in Section 2.01.
"PLEDGE ACCOUNT" means an account established with a securities
intermediary for the benefit of the Trustee pursuant to the terms of the Pledge
Agreement for the deposit of the Pledged Securities to be purchased by the
Company with a portion of the net proceeds from the sale of the Notes.
"PLEDGE AGREEMENT" means the U.S. Dollar Collateral Pledge and Security
Agreement, dated as of the Closing Date, made by the Company in favor of the
Trustee, as such agreement may be amended, restated, supplemented or otherwise
modified from time to time.
"PLEDGED SECURITIES" means the U.S. Government Securities to be purchased
by the Company and held in the Pledge Account in accordance with the Pledge
Agreement.
"PERSON" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"PREFERRED STOCK" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's preferred or preference equity, whether
now outstanding or issued after the Closing Date, including, without limitation,
all series and classes of such preferred stock or preference stock.
23
"PRINCIPAL" of a debt security, including the Notes, means the principal
amount due on the Stated Maturity as shown on such debt security.
"PRIVATE PLACEMENT LEGEND" means the legend initially set forth on the
Notes in the form set forth in Section 2.02(a).
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"REDEMPTION DATE" means, when used with respect to any Note to be redeemed,
the date fixed for such redemption by or pursuant to this Indenture.
"REDEMPTION PRICE" means, when used with respect to any Note to be
redeemed, the price at which such Note is to be redeemed pursuant to this
Indenture.
"REFINANCE" means refinance, refund, replace, renew, repay, modify,
restate, defer, substitute, supplement, reissue, resell or extend (including by
way of any exchange of Indebtedness, or pursuant to any defeasance or discharge
mechanism); and the terms "refinances," "refinanced" and "refinancing" as used
for any purpose in this Indenture shall have a correlative meaning.
"REGISTRAR" has the meaning provided in Section 2.04.
"REGISTRATION" has the meaning provided in Section 4.18.
"REGISTRATION RIGHTS AGREEMENT" means the Notes Registration Rights
Agreement, dated February 12, 1999, between the Company and Xxxxxx Xxxxxxx & Co.
Incorporated, Xxxxxxx Xxxxx Barney Inc., Warburg Dillon Read LLC and Bear,
Xxxxxxx & Co. Inc. and certain permitted assigns specified therein.
"REGISTRATION STATEMENT" means the Registration Statement as defined and
described in the Registration Rights Agreement.
"REGULAR RECORD DATE" for the interest payable on any Interest Payment Date
means the February 1 or August 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.
"REGULATION S" means Regulation S under the Securities Act.
"RELEASED INDEBTEDNESS" means, with respect to any Asset Sale, (i)
Indebtedness of the Company or any Restricted Subsidiary which is assumed by the
purchaser or any affiliate thereof in connection with such Asset Sale; PROVIDED
that the Company or such Restricted Subsidiary receives written, unconditional,
valid and enforceable releases from each creditor, no later than
24
the closing date of such Asset Sale and (ii) Indebtedness of a Restricted
Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset
Sale; PROVIDED that neither the Company nor any other Restricted Subsidiary
thereafter Guarantees such Indebtedness.
"RELEASED LIABILITIES" has the meaning provided in Section 4.11.
"RESPONSIBLE OFFICER," when used with respect to the Trustee, means any
senior vice president, any vice president, any assistant vice president, any
assistant secretary, any assistant treasurer, any trust officer or assistant
trust officer, or any other officer of the Trustee in its corporate trust
department 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 or her knowledge of and familiarity with the particular subject.
"RESTRICTED SUBSIDIARY" means any Subsidiary of the Company other than an
Unrestricted Subsidiary.
"RESTRICTED PAYMENTS" has the meaning provided in Section 4.04.
"RULE 144A" means Rule 144A under the Securities Act.
"S&P" means Standard & Poor's Ratings Services, a division of the
XxXxxx-Xxxx Companies, and its successors.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITY REGISTER" has the meaning provided in Section 2.04.
"SEPARATION DATE" has the meaning provided in the recitals to this
Indenture.
"SHELF REGISTRATION STATEMENT" means the Shelf Registration Statement as
defined in the Registration Rights Agreement.
"SIGNIFICANT SUBSIDIARY" means, at any date of determination, any
Restricted Subsidiary that, together with its Subsidiaries, (i) for the most
recent fiscal year of the Company, accounted for more than 10% of the
consolidated revenues of the Company and its Restricted Subsidiaries or (ii) as
of the end of such fiscal year, was the owner of more than 10% of the
consolidated assets of the Company and its Restricted Subsidiaries, all as set
forth on the most recently available consolidated financial statements of the
Company for such fiscal year.
"STATED MATURITY" means, (i) with respect to any debt security, the date
specified in such debt security as the fixed date on which the final installment
of principal of such debt security is
25
due and payable and (ii) with respect to any scheduled installment of principal
of or interest on any debt security, the date specified in such debt security as
the fixed date on which such installment is due and payable.
"STRATEGIC SUBORDINATED INDEBTEDNESS" means Indebtedness of the Company or
any Permanent Guarantor Incurred to finance the acquisition of a Person engaged
in a business that is related, ancillary or complementary to the business
conducted by the Company or any of its Restricted Subsidiaries, which
Indebtedness by its terms, or by the terms of any agreement or instrument
pursuant to which such Indebtedness is Incurred, (i) is expressly made
subordinate in right of payment to the Notes and (ii) provides that no payment
of principal, premium or interest on, or any other payment with respect to, such
Indebtedness may be made prior to the payment in full of all of the Company's
obligations under the Notes; PROVIDED that such Indebtedness may provide for and
be repaid at any time from the proceeds of a capital contribution or the sale of
Capital Stock (other than Disqualified Stock) of the Company after the
Incurrence of such Indebtedness.
"SUBSIDIARY" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.
"SUBSIDIARY GUARANTEE" has the meaning provided in Section 4.07.
"SUBSIDIARY GUARANTOR" means any Restricted Subsidiary that Guarantees the
Notes pursuant to Section 4.07.
"TAXING AUTHORITY" has the meaning provided in Section 4.20.
"TAXES" has the meaning provided in Section 4.20.
"TEMPORARY CASH INVESTMENT" means any of the following:
(i) direct obligations of the United States of America or any agency
thereof or obligations fully and unconditionally guaranteed by the United
States of America or any agency thereof;
(ii) bankers' acceptances, time deposit accounts, certificates of
deposit and money market deposits maturing within one year of the date of
acquisition thereof issued by a bank or trust company which is organized
under the laws of the United States of America, any state thereof or any
foreign country recognized by the United States of America, and which bank
or trust company has capital, surplus and undivided profits aggregating in
excess of $50 million (or the foreign currency equivalent thereof) and has
outstanding debt
26
which is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization or any
money-market fund sponsored by a registered broker dealer or mutual fund
distributor;
(iii) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (i) above or clause
(vi) below entered into with a bank meeting the qualifications described in
clause (ii) above;
(iv) commercial paper, maturing not more than one year after the date
of acquisition, issued by a corporation (other than an Affiliate of the
Company) organized and in existence under the laws of the United States of
America, any state thereof or any foreign country recognized by the United
States of America with a rating at the time as of which any investment
therein is made of "P-1" (or higher) according to Xxxxx'x or "A-1" (or
higher) according to S&P;
(v) securities with maturities of six months or less from the date of
acquisition issued or fully and unconditionally guaranteed by any state,
commonwealth or territory of the United States of America, or by any
political subdivision or taxing authority thereof, and rated at least "A"
by S&P or Xxxxx'x; and
(vi) direct obligations of, or obligations fully and unconditionally
guaranteed by, (a) The Netherlands, the United Kingdom, France, Germany or
Switzerland, or (b) any other member of the European Economic Community and
rated at least "A" by S&P or Xxxxx'x.
"TEMPORARY OFFSHORE GLOBAL NOTES" has the meaning provided in Section 2.01.
"TRADE PAYABLES" means, with respect to any Person, any accounts payable or
any other indebtedness or monetary obligation to trade creditors created,
assumed or guaranteed by such Person or any of its Subsidiaries arising in the
ordinary course of business in connection with the acquisition of goods or
services.
"TRANSACTION DATE" means, with respect to the Incurrence of any
Indebtedness by the Company or any of its Restricted Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment, the
date such Restricted Payment is to be made.
"TIA" or "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 (15
U.S. Code Sections 77aaa-77bbbb), as amended, as in effect on the date this
Indenture was executed, except as provided in Section 9.06.
27
"TRUSTEE" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.
"UNITED STATES BANKRUPTCY CODE" means the Bankruptcy Reform Act of 1978, as
amended and as codified in Title 11 of the United States Code, as amended from
time to time hereafter, or any successor federal bankruptcy law.
"UNITS" means the Dollar Units and the Euro Units.
"UNRESTRICTED SUBSIDIARY" means (i) any Subsidiary of the Company that at
the time of determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below and (ii) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors may designate any Restricted
Subsidiary (including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on any property of, the Company or
any Restricted Subsidiary; PROVIDED that (A) any Guarantee by the Company or any
Restricted Subsidiary of any Indebtedness of the Subsidiary being so designated
shall be deemed an "Incurrence" of such Indebtedness and an "Investment" by the
Company or such Restricted Subsidiary (or both, if applicable) at the time of
such designation; (B) either (I) the Subsidiary to be so designated has total
assets of $1,000 or less or (II) if such Subsidiary has assets greater than such
amount, such designation would be permitted under Section 4.04 of this Indenture
and (C) if applicable, the Incurrence of Indebtedness and the Investment
referred to in clause (A) of this proviso would be permitted under Sections 4.03
and 4.04 of this Indenture. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; PROVIDED that (i) no
Default or Event of Default shall have occurred and be continuing at the time of
or after giving effect to such designation and (ii) all Liens and Indebtedness
of such Unrestricted Subsidiary outstanding immediately after such designation
would, if Incurred at such time, have been permitted to be Incurred (and shall
be deemed to have been Incurred) for all purposes of this Indenture. Any such
designation by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the Board Resolution giving effect to
such designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
"U.S. GLOBAL NOTES" has the meaning provided in Section 2.01.
"U.S. GOVERNMENT OBLIGATIONS" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof at any time prior
to the Stated Maturity of the Notes,
28
and shall also include a depository receipt issued by a bank or trust company as
custodian with respect to any such U.S. Government Obligation or a specific
payment of interest on or principal of any such U.S. Government Obligation held
by such custodian for the account of the holder of a depository receipt;
PROVIDED that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the U.S.
Government Obligation or the specific payment of interest on or principal of the
U.S. Government Obligation evidenced by such depository receipt.
"U.S. GOVERNMENT SECURITIES" means direct obligations of, obligations fully
guaranteed by, or participations in pools consisting solely of obligations of or
obligations guaranteed by, the United States of America for the payment of which
guarantee or obligations the full faith and credit of the United States of
America is pledged and which are not callable or redeemable at the option of the
issuer thereof.
"U.S. PHYSICAL NOTES" means the Notes issued in the form of permanent
certificated Notes in registered form in substantially the form set forth in
Exhibit A to Institutional Accredited Investors which are not QIBs (excluding
Non-U.S. Persons) in accordance with Section 2.08(a).
"VOTING STOCK" means with respect to any Person, Capital Stock of any class
or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"WARRANT AGREEMENTS" means the Dollar Warrant Agreement and the Euro
Warrant Agreement.
"WARRANTS" means the Dollar Warrants and the Euro Warrants.
"WHOLLY OWNED" means, with respect to any Subsidiary of any Person, the
ownership of all of the outstanding Capital Stock of such Subsidiary (other than
any director's qualifying shares or Investments by foreign nationals mandated by
applicable law) by such Person or one or more Wholly Owned Subsidiaries of such
Person.
SECTION 1.02. 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 or a Noteholder;
29
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee; and
"OBLIGOR" on the indenture securities means the Company or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.
SECTION 1.03. RULES OF CONSTRUCTION. Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the plural
include the singular;
(v) provisions apply to successive events and transactions;
(vi) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision;
(vii) all ratios and computations based on GAAP contained in this
Indenture shall be computed in accordance with the definition of GAAP set
forth in Section 1.01; and
(viii) all references to Sections or Articles refer to Sections or
Articles of this Indenture unless otherwise indicated.
ARTICLE TWO
THE NOTES
SECTION 2.01. FORM AND DATING. The Notes and the Trustee's certificate of
authentication shall be substantially in the form annexed hereto as Exhibit A
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this
30
Indenture. The Notes may have notations, legends or endorsements required by
law, stock exchange agreements to which the Company is subject or usage. The
Company shall approve the form of the Notes and any notation, legend or
endorsement on the Notes. Each Note shall be dated the date of its
authentication.
The terms and provisions contained in the form of the Notes annexed hereto
as Exhibit A shall constitute, and are hereby expressly made, a part of this
Indenture. To the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Notes offered and sold in reliance on Rule 144A shall be issued initially
in the form of one or more permanent global Notes in registered form,
substantially in the form set forth in Exhibit A (the "U.S. GLOBAL NOTES"),
registered in the name of the nominee of the Depositary, deposited with the
Trustee, as custodian for the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the U.S. Global Notes may from time to time be increased or decreased
by adjustments made on the records of the Trustee, as custodian for the
Depositary or its nominee, in accordance with the instructions given by the
Holder thereof, as hereinafter provided.
Notes transferred in offshore transactions in reliance on Regulation S (a)
prior to the Separation Date shall be in the form of permanent certificated
Notes in registered form substantially in the form set forth in Exhibit A
("OFFSHORE PHYSICAL NOTES"), (b) following the Separation Date but prior to
April 1, 1999, shall be in the form of one or more temporary global Notes in
registered form substantially in the form set forth in Exhibit A (the "TEMPORARY
OFFSHORE GLOBAL NOTES"), registered in the name of the nominee of the
Depositary, deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee and (c) following the
Separation Date and on and after April 1, 1999, shall be initially in the form
of one or more permanent global Notes in registered form substantially in the
form set forth in Exhibit A (the "PERMANENT OFFSHORE GLOBAL NOTES" and, together
with the Temporary Offshore Global Notes, the "OFFSHORE GLOBAL NOTES"),
registered in the name of the nominee of the Depositary, deposited with the
Trustee, as custodian for the Depositary, duly executed by the Company and
authenticated by the Trustee. The aggregate principal amount of the Offshore
Global Notes may from time to time be increased or decreased by adjustments made
on the records of the Trustee, in accordance with the instructions given by the
Holder thereof, as hereinafter provided.
At any time on or after the later of the Separation Date and April 1, 1999,
upon receipt by the Trustee and the Company of a certificate substantially in
the form of Exhibit B hereto, one or more Permanent Offshore Global Notes
executed by the Company and authenticated by the Trustee shall be deposited with
the Trustee, as custodian for the Depositary or its nominee, in exchange for any
Temporary Offshore Global Notes and the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of the Temporary
Offshore Global
31
Notes in an amount equal to the principal amount of the beneficial interest in
such Temporary Offshore Global Notes transferred.
Additional Notes sold in offshore transactions in reliance on Regulation S
(a) prior to the 41st day following the date such series of Additional Notes are
first issued hereunder, shall be in the form of one or more Temporary Offshore
Global Notes, registered in the name of the nominee of the Depositary, deposited
with the Trustee as custodian for the Depositary, duly executed by the Company
and authenticated by the Trustee and (b) on and after such 41st day, shall be
initially in the form of one or more Permanent Offshore Global Notes, registered
in the name of the nominee of the Depositary, deposited with the Trustee, as
custodian for the Depositary, duly executed by the Company and authenticated by
the Trustee.
Notes issued pursuant to Section 2.07 in exchange for interests in the
Offshore Global Notes shall be in the form of Offshore Physical Notes.
The Offshore Physical Notes and U.S. Physical Notes are sometimes
collectively herein referred to as the "PHYSICAL NOTES." The U.S. Global Notes
and the Offshore Global Notes are sometimes referred to herein as the "GLOBAL
NOTES."
The definitive Notes shall be typed, printed, lithographed or engraved or
produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Notes may
be listed, all as determined by the Officer or Officers executing such Notes, as
evidenced by the execution of such Notes.
SECTION 2.02. RESTRICTIVE LEGENDS. (a) Unless and until a Note is exchanged
for an Exchange Note or sold in connection with an effective Registration
Statement pursuant to the Registration Rights Agreement (or in the case of
Additional Notes not initially sold pursuant to a registration statement, in
connection with another registration statement), (i) the U.S. Global Notes and
any U.S. Physical Notes shall bear the legend set forth below on the face
thereof and (ii) the Offshore Physical Notes, until the later of the Separation
Date and the 41st day after the Closing Date (or, in the case of such Additional
Notes, until the later of any separation date with respect thereto and the 41st
day after such Addition of Notes are first issued hereunder), and receipt by the
Company and the Trustee of a certificate substantially in the form of Exhibit B
hereto, and the Temporary Offshore Global Notes shall bear the legend set forth
below on the face thereof.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF, THE HOLDER (1)
32
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES
ACT, (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER
RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF SUCH
TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY
OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED
STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF
THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE) AND,
IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES OF
LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D) TO A PERSON
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE)
OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THE TIME PERIOD REFERRED
TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH
TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S
33
UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE
TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE
FOREGOING RESTRICTIONS.
(b) Each Global Note, whether or not an Exchange Note, shall also bear the
following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.08 OF THE INDENTURE.
(c) Prior to the Separation Date, each Note shall bear the following legend
on the face thereof:
THIS NOTE IS INITIALLY ISSUED AS PART OF AN ISSUANCE OF UNITS, EACH OF
WHICH CONSISTS OF ONE NOTE AND ONE DOLLAR WARRANT INITIALLY ENTITLING THE
HOLDER THEREOF TO PURCHASE 6.71013 SHARES OF COMMON STOCK, PAR VALUE $2.00
PER SHARE, OF CARRIER1 INTERNATIONAL S.A. (A "WARRANT"). PRIOR TO THE CLOSE
OF BUSINESS UPON THE EARLIEST TO OCCUR OF (i) AUGUST 19, 1999, (ii) THE
COMMENCEMENT OF THE EXCHANGE OFFER UNDER THE REGISTRATION RIGHTS AGREEMENT,
(iii) THE EFFECTIVE DATE OF A SHELF REGISTRATION STATEMENT WITH RESPECT TO
RESALES OF THE NOTES AND (iv) SUCH DATE AS DETERMINED BY XXXXXX XXXXXXX &
CO. INCORPORATED IN ITS SOLE DISCRETION, THE NOTES EVIDENCED BY THIS
CERTIFICATE MAY NOT
34
BE TRANSFERRED OR EXCHANGED SEPARATELY FROM, BUT MAY BE TRANSFERRED OR
EXCHANGED ONLY TOGETHER WITH, THE WARRANTS.
The Company shall notify the Trustee in writing upon obtaining knowledge of
the occurrence of the Separation Date. Upon the request of any Holder after the
Separation Date, the Registrar shall deliver Notes that do not bear the legend
set forth in this paragraph (c).
SECTION 2.03. EXECUTION, AUTHENTICATION AND DENOMINATIONS. Subject to
Article Four and applicable law, the aggregate principal amount of Notes which
may be authenticated and delivered under this Indenture is unlimited. The Notes
shall be executed by one Officer of the Company. The signature of an Officer on
the Notes may be by facsimile or manual signature in the name and on behalf of
the Company.
If an Officer whose signature is on a Note no longer holds that office at
the time the Trustee or authenticating agent authenticates the Note, the Note
shall be valid nevertheless.
A Note shall not be valid until the Trustee or authenticating agent
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
At any time and from time to time after the execution of this Indenture,
the Trustee or an authenticating agent shall upon receipt of a Company Order
authenticate for original issue Notes in the aggregate principal amount
specified in such Company Order; PROVIDED that the Trustee shall be entitled to
receive an Officers' Certificate and an Opinion of Counsel of the Company in
connection with such authentication of Notes. Such Company Order shall specify
the amount of Notes to be authenticated and the date on which the original issue
of Notes is to be authenticated and, in case of an issuance of Notes pursuant to
Section 2.15, shall certify that such issuance is in compliance with Article
Four.
The Trustee may appoint an authenticating agent to authenticate Notes. An
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such authenticating agent. An authenticating agent has the
same rights as an Agent to deal with the Company or an Affiliate of the Company.
The Notes shall be issuable only in registered form without coupons and
only in denominations of $1,000 in principal amount and any integral multiple
thereof.
SECTION 2.04. REGISTRAR AND PAYING AGENT. The Company shall maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange (the "REGISTRAR"), an office or agency where Notes may be presented
for payment (the "PAYING AGENT")
35
and an office or agency where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served, which shall be in the
Borough of Manhattan, The City of New York. The Company shall cause the
Registrar to keep a register of the Notes and of their transfer and exchange
(the "SECURITY REGISTER"). The Security Register shall be in written form or any
other form capable of being converted into written form within a reasonable
time. The Company may have one or more co-Registrars and one or more additional
Paying Agents.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall give prompt written
notice to the Trustee of the name and address of any such Agent and any change
in the address of such Agent. If the Company fails to maintain a Registrar,
Paying Agent and/or agent for service of notices and demands, the Trustee shall
act as such Registrar, Paying Agent and/or agent for service of notices and
demands. The Company may remove any Agent upon written notice to such Agent and
the Trustee; PROVIDED that no such removal shall become effective until (i) the
acceptance of an appointment by a successor Agent to such Agent as evidenced by
an appropriate agency agreement entered into by the Company and such successor
Agent and delivered to the Trustee or (ii) notification to the Trustee that the
Trustee shall serve as such Agent until the appointment of a successor Agent in
accordance with clause (i) of this proviso. The Company, any Subsidiary of the
Company, or any Affiliate of any of them may act as Paying Agent, Registrar or
co-Registrar, and/or agent for service of notice and demands.
The Company initially appoints the Trustee as Registrar, Paying Agent and
authenticating agent. 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 Holders and shall otherwise comply with TIA Section 312(a). If the
Trustee is not the Registrar, the Company shall furnish to the Trustee as of
each Regular Record Date and at such other times as the Trustee may reasonably
request the names and addresses of Holders as they appear in the Security
Register, including the aggregate principal amount of Notes held by each Holder.
SECTION 2.05. PAYING AGENT TO HOLD MONEY IN TRUST. Not later than 11:00
a.m. (New York City time) on the Business Day prior to each due date of the
principal, premium, if any, and interest on any Notes, the Company shall deposit
with the Paying Agent money in immediately available funds sufficient to pay
such principal, premium, if any, and interest so becoming due; PROVIDED that
Pledged Securities held pursuant to the Pledge Agreement may satisfy the
provisions of this sentence. The Company shall require each Paying Agent other
than the Trustee to agree in writing that such Paying Agent shall hold in trust
for the benefit of the Holders or the Trustee all money held by the Paying Agent
for the payment of principal of, premium, if any, and interest on the Notes
(whether such money has been paid to it by the Company or any other obligor on
the Notes), and such Paying Agent shall promptly notify the Trustee of any
default by the Company (or any other obligor on the Notes) in making any such
payment. The Company at any
36
time may require a Paying Agent to pay all money held by it to the Trustee
and account for any funds disbursed, and the Trustee may at any time during
the continuance of any payment default, upon written request to a Paying
Agent, require such Paying Agent to pay all money held by it to the Trustee
and to account for any funds disbursed. Upon doing so, the Paying Agent shall
have no further liability for the money so paid over to the Trustee. If the
Company or any Subsidiary of the Company or any Affiliate of any of them acts
as Paying Agent, it will, on or before each due date of any principal of,
premium, if any, or interest on the Notes, segregate and hold in a separate
trust fund for the benefit of the Holders a sum of money sufficient to pay
such principal, premium, if any, or interest so becoming due until such sum
of money shall be paid to such Holders or otherwise disposed of as provided
in this Indenture, and will promptly notify the Trustee of its action or
failure to act.
SECTION 2.06. TRANSFER AND EXCHANGE. The Notes are issuable only in
registered form. The Notes shall initially be issued as part of an issue of
Dollar Units, each of which consists of one Note and one Dollar Warrant. Prior
to the Separation Date, the Notes may not be transferred or exchanged separately
from, but may be transferred or exchanged only together with, the Dollar
Warrants issued in connection with the Notes. A Holder may transfer a Note only
by written application to the Registrar stating the name of the proposed
transferee and otherwise complying with the terms of this Indenture. No such
transfer shall be effected until, and such transferee shall succeed to the
rights of a Holder only upon, final acceptance and registration of the transfer
by the Registrar in the Security Register. Prior to the registration of any
transfer by a Holder as provided herein, the Company, the Trustee, and any agent
of the Company shall treat the person in whose name the Note is registered as
the owner thereof for all purposes whether or not the Note shall be overdue, and
neither the Company, the Trustee, nor any such agent shall be affected by notice
to the contrary. Owners of beneficial interests in a Global Note will not be
entitled to have Notes registered in their names, and will not receive or be
entitled to receive Physical Notes except pursuant to Section 2.07(b).
Furthermore, any Holder of a Global Note shall, by acceptance of such Global
Note, agree that transfers of beneficial interests in such Global Note may be
effected only through a book entry system maintained by the Holder of such
Global Note (or its agent) and that ownership of a beneficial interest in the
Note shall be required to be reflected in a book entry. When Notes are presented
to the Registrar or a co-Registrar with a request to register the transfer or to
exchange them for an equal principal amount of Notes of other authorized
denominations (including an exchange of Notes for Exchange Notes), the Registrar
shall register the transfer or make the exchange as requested if its
requirements for such transactions are met (including that such Notes are duly
endorsed or accompanied by a written instrument of transfer in form satisfactory
to the Trustee and Registrar duly executed by the Holder thereof or by an
attorney who is authorized in writing to act on behalf of the Holder); PROVIDED
that no exchanges of Notes for Exchange Notes shall occur until a Registration
Statement shall have been declared effective by the Commission and that any
Notes that are exchanged for Exchange Notes shall be canceled by the Trustee. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Notes at the Registrar's
37
request. No service charge shall be made for any registration of transfer or
exchange or redemption of the Notes, but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer taxes or other similar
governmental charge payable upon exchanges pursuant to Section 2.11, 3.08 or
9.04).
The Registrar shall not be required (i) to issue, register the transfer of
or exchange any Note during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of Notes selected
for redemption under Section 3.03 and ending at the close of business on the day
of such mailing, or (ii) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part.
SECTION 2.07. BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES. (a) The Global Notes
initially shall (i) be registered in the name of the Depositary for such Global
Notes or the nominee of such Depositary, (ii) be delivered to the Trustee as
custodian for such Depositary and (iii) bear legends as set forth in Section
2.02.
Members of, or participants in, the Depositary ("AGENT MEMBERS") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depositary, or the Trustee as its custodian, or under such Global
Note, and the Depositary may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of such Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee,
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers of such Global
Note in whole, but not in part, to the Depositary, its successors or their
respective nominees. Interests of beneficial owners in Global Notes may be
transferred in accordance with the rules and procedures of the Depositary and
the provisions of Section 2.08. In addition, Physical Notes shall be transferred
to the Depositary for all beneficial owners in exchange for their beneficial
interests in the Global Notes if (i) the Depositary notifies the Company that it
is unwilling or unable to continue as Depositary for the Global Notes, and a
successor depositary is not appointed by the Company within 90 days of such
notice or (ii) an Event of Default has occurred and is continuing and the
Registrar has received a request from the Depositary to issue Physical Notes.
(c) Any beneficial interest in one of the Global Notes that is transferred
to a person who takes delivery in the form of an interest in another Global Note
will, upon transfer, cease to be an interest in such Global Note and become an
interest in such other Global Note and,
38
accordingly, will thereafter be subject to all transfer restrictions, if any,
and other procedures applicable to beneficial interests in such other Global
Note for as long as it remains such an interest.
(d) In connection with the transfer of the Global Notes in whole, to
beneficial owners pursuant to paragraph (b) of this Section 2.07, the Global
Notes shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall authenticate and deliver, to the
Depositary for each beneficial owner identified by the Depositary in exchange
for its beneficial interest in the Global Notes an equal aggregate principal
amount of Physical Notes of authorized denominations.
(d) Any U.S. Physical Note delivered in exchange for an interest in the
U.S. Global Notes pursuant to paragraph (b) or (d) of this Section 2.07 shall,
except as otherwise provided by paragraph (f) of Section 2.08, bear the legend
regarding transfer restrictions applicable to the Physical Note set forth in
Section 2.02.
(e) Any Offshore Physical Note delivered in exchange for an interest in the
Offshore Global Notes pursuant to paragraph (b) or (d) of this Section 2.07
shall, except as otherwise provided by paragraph (f) of Section 2.08, bear the
legend regarding transfer restrictions applicable to the Physical Note set forth
in Section 2.02.
(e) The registered holder of a Global Note may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
SECTION 2.08. SPECIAL TRANSFER PROVISIONS. Unless and until a Note is
exchanged for an Exchange Note or sold in connection with an effective
Registration Statement pursuant to the Registration Rights Agreement (or in the
case of Additional Notes not initially sold pursuant to a registration
statement, in connection with another registration statement), the following
provisions shall apply:
(a) TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS. The following
provisions shall apply with respect to the registration of any proposed transfer
of a Note to any Institutional Accredited Investor which is not a QIB (excluding
Non-U.S. Persons):
(i) The Registrar shall register the transfer of any Note, whether or
not such Note bears the Private Placement Legend, if (x) the requested
transfer is after the time period referred to in Rule 144(k) under the
Securities Act or (y) the proposed transferee has delivered to the
Registrar (A) a certificate substantially in the form of Exhibit C hereto
and (B) if the aggregate principal amount of the Notes being transferred is
less than $250,000, an opinion of counsel acceptable to the Company that
such transfer is in compliance with the Securities Act.
39
(ii) If the proposed transferor is an Agent Member holding a
beneficial interest in the U.S. Global Notes, upon receipt by the Registrar
of (x) the documents, if any, required by paragraph (i) above and (y)
instructions given in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the U.S. Global Notes in an
amount equal to the principal amount of the beneficial interest in the U.S.
Global Notes to be transferred, and the Company shall execute, and the
Trustee shall authenticate and deliver, one or more U.S. Physical Notes of
like tenor and amount.
(b) TRANSFERS TO QIBS. The following provisions shall apply with respect to
the registration of any proposed transfer of a Note to a QIB:
(i) If the Note to be transferred consists of (x) U.S. Physical Notes,
the Registrar shall register the transfer if such transfer is being made by
a proposed transferor who has checked the box provided for on the form of
Note stating, or has otherwise advised the Company and the Registrar in
writing, that the sale has been made in compliance with the provisions of
Rule 144A to a transferee who has signed the certification provided for on
the form of Note stating, or has otherwise advised the Company and the
Registrar in writing, that it is purchasing the Note for its own account or
an account with respect to which it exercises sole investment discretion
and that it and any such account is a QIB within the meaning of Rule 144A
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as
it has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon
its foregoing representations in order to claim the exemption from
registration provided by Rule 144A or (y) an interest in the U.S. Global
Notes, the transfer of such interest may be effected only through the book
entry system maintained by the Depositary.
(ii) If the proposed transferee is an Agent Member, and the Note to be
transferred consists of U.S. Physical Notes, upon receipt by the Registrar
of the documents referred to in paragraph (i) above and instructions given
in accordance with the Depositary's and the Registrar's procedures, the
Registrar shall reflect on its books and records the date and an increase
in the principal amount of U.S. Global Notes in an amount equal to the
principal amount of the U.S. Physical Notes to be transferred, and the
Trustee shall cancel the U.S. Physical Notes so transferred.
(c) TRANSFERS OF INTERESTS IN THE TEMPORARY OFFSHORE GLOBAL NOTES OR
LEGENDED OFFSHORE PHYSICAL NOTES. The following provisions shall apply with
respect to registration of any
40
proposed transfer of an interest in a Temporary Offshore Global Notes or any
Offshore Physical Notes bearing the Private Placement Legend:
(i) The Registrar shall register the transfer of any Note (x) if the
proposed transferee is a Non-U.S. Person and the proposed transferor has
delivered to the Registrar a certificate substantially in the form of
Exhibit D hereto or (y) if the proposed transferee is a QIB and the
proposed transferor has checked the box provided for on the form of Note
stating, or has otherwise advised the Company and the Registrar in writing,
that the sale has been made in compliance with the provisions of Rule 144A
to a transferee who has signed the certification provided for on the form
of Note stating, or has otherwise advised the Company and the Registrar in
writing, that it is purchasing the Note for its own account or an account
with respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the Company as it has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon its
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
(ii) If the proposed transferee is an Agent Member, upon receipt by
the Registrar of the documents referred to in clause (i)(y) above and
instructions given in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and an increase in the principal amount of the U.S. Global Notes in an
amount equal to the principal amount of the Temporary Offshore Global Notes
or legended Offshore Physical Notes to be transferred, and the Trustee
shall decrease the amount of the Temporary Offshore Global Notes or cancel
the legended Offshore Physical Notes, as the case may be.
(d) TRANSFERS OF INTERESTS IN THE PERMANENT OFFSHORE GLOBAL NOTES OR
UNLEGENDED OFFSHORE PHYSICAL NOTES. The following provisions shall apply with
respect to any transfer of interests in Permanent Offshore Global Notes or
unlegended Offshore Physical Notes. The Registrar shall register the transfer of
any such Note without requiring any additional certification.
(e) TRANSFERS TO NON-U.S. PERSONS AT ANY TIME. The following provisions
shall apply with respect to any transfer of a Note to a Non-U.S. Person
(excluding QIBs):
(i) Prior to the Separation Date and prior to April 1, 1999, the
Registrar shall register any proposed transfer of a Note to a Non-U.S.
Person only if it receives a certificate substantially in the form of
Exhibit D hereto from the proposed transferor and such transfer is in
conjunction with a transfer of the related Dollar Warrants pursuant to the
terms of the Dollar Warrant Agreement.
41
(ii) On and after the Separation Date but prior to April 1, 1999, the
Registrar shall register any proposed transfer to any Non-U.S. Person upon
receipt of a certificate substantially in the form of Exhibit D hereto from
the proposed transferor.
(iii) (a) If the proposed transferor is an Agent Member holding a
beneficial interest in the U.S. Global Notes, upon receipt by the Registrar
of (x) the documents, if any, required by paragraph (ii) and (y)
instructions in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the U.S. Global Notes in an
amount equal to the principal amount of the beneficial interest in the U.S.
Global Notes to be transferred, and (b) if the proposed transferee is an
Agent Member and the transfer is after the Separation Date, upon receipt by
the Registrar of instructions given in accordance with the Depositary's and
the Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Offshore
Global Notes in an amount equal to the principal amount of the U.S.
Physical Notes or the U.S. Global Notes, as the case may be, to be
transferred, and the Trustee shall cancel the Physical Note, if any, so
transferred or decrease the amount of the U.S. Global Notes.
(f) PRIVATE PLACEMENT LEGEND. Upon the transfer, exchange or replacement of
Notes not bearing the Private Placement Legend, the Registrar shall deliver
Notes that do not bear the Private Placement Legend. Upon the transfer, exchange
or replacement of Notes bearing the Private Placement Legend, the Registrar
shall deliver only Notes that bear the Private Placement Legend unless (i) the
Private Placement Legend is no longer required by Section 2.02, (ii) the
circumstances contemplated by paragraph (a)(i)(x) of this Section 2.08 exist or
(iii) there is delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act.
(g) GENERAL. By its acceptance of any Note bearing the Private Placement
Legend, each Holder of such a Note acknowledges the restrictions on transfer of
such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in this Indenture. The
Registrar shall not register a transfer of any Note unless such transfer
complies with the restrictions on transfer of such Note set forth in this
Indenture. In connection with any transfer of Notes, each Holder agrees by its
acceptance of the Notes to furnish the Registrar or the Company such
certifications, legal opinions or other information as either of them may
reasonably require to confirm that such transfer is being made pursuant to an
exemption from, or a transaction not subject to, the registration requirements
of the Securities Act; PROVIDED that neither the Registrar nor the Trustee shall
be required to determine (but may rely on a determination made by the Company
with respect to) the sufficiency of any such certifications, legal opinions or
other information.
42
The Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.07 or this Section 2.08. The
Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
SECTION 2.09. REPLACEMENT NOTES. If a mutilated Note is surrendered to the
Trustee or if the Holder claims that the Note has been lost, destroyed or
wrongfully taken, then, in the absence of notice to the Company or the Trustee
that such Note has been acquired by a bona fide purchaser, the Company shall
issue and the Trustee shall authenticate a replacement Note of like tenor and
principal amount and bearing a number not contemporaneously outstanding;
PROVIDED that the requirements of this Section 2.09 are met. If required by the
Trustee or the Company, an indemnity bond must be furnished that is sufficient
in the judgment of both the Trustee and the Company to protect the Company, the
Trustee or any Agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge such Holder for its expenses and the expenses
of the Trustee in replacing a Note. In case any such mutilated, lost, destroyed
or wrongfully taken Note has become or is about to become due and payable, the
Company in its discretion may pay such Note instead of issuing a new Note in
replacement thereof.
Every replacement Note is an additional obligation of the Company and shall
be entitled to the benefits of this Indenture.
SECTION 2.10. OUTSTANDING NOTES. Notes outstanding at any time are all
Notes that have been authenticated by the Trustee except for those canceled by
it, those delivered to it for cancellation and those described in this Section
2.10 as not outstanding.
If a Note is replaced pursuant to Section 2.09, it ceases to be outstanding
unless and until the Trustee and the Company receive proof satisfactory to them
that the replaced Note is held by a BONA FIDE purchaser.
If the Paying Agent (other than the Company or an Affiliate of the Company)
holds on the maturity date money sufficient to pay Notes payable on that date,
then on and after that date such Notes cease to be outstanding and interest on
them shall cease to accrue.
A Note does not cease to be outstanding because the Company or one of its
Affiliates holds such Note, PROVIDED, HOWEVER, that in determining whether the
Holders of the requisite principal amount of the outstanding Notes have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Notes owned by the Company or any other obligor upon the Notes or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which the Trustee has actual
knowledge to be so owned shall be so disregarded. Notes
43
so owned which have been pledged in good faith may be regarded as outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Notes and that the pledgee is not the Company or
any other obligor upon the Notes or any Affiliate of the Company or of such
other obligor.
SECTION 2.11. TEMPORARY NOTES. Until definitive Notes are ready for
delivery, the Company may prepare and execute and the Trustee shall authenticate
temporary Notes. Temporary Notes shall be substantially in the form of
definitive Notes but may have insertions, substitutions, omissions and other
variations determined to be appropriate by the Officer or Officers executing the
temporary Notes, as evidenced by their execution of such temporary Notes. If
temporary Notes are issued, the Company will cause definitive Notes to be
prepared without unreasonable delay. After the preparation of definitive Notes,
the temporary Notes shall be exchangeable for definitive Notes upon surrender of
the temporary Notes at the office or agency of the Company designated for such
purpose pursuant to Section 4.02, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Notes the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Notes of authorized denominations. Until so
exchanged, the temporary Notes shall be entitled to the same benefits under this
Indenture as definitive Notes.
SECTION 2.12. CANCELLATION. The Company at any time may deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold. The Registrar and the
Paying Agent shall forward to the Trustee any Notes surrendered to them for
transfer, exchange or payment. The Trustee shall cancel all Notes surrendered
for transfer, exchange, payment or cancellation and shall destroy them in
accordance with its normal procedure.
SECTION 2.13. CUSIP NUMBERS. The Company in issuing the Notes may use
"CUSIP", "CINS" or "ISIN" numbers or common codes (if then generally in use),
and the Company and the Trustee shall use any such CUSIP, CINS or ISIN numbers
or common codes, as the case may be, in notices of redemption or exchange as a
convenience to Holders; PROVIDED that any such notice shall state that no
representation is made as to the correctness of such numbers either as printed
on the Notes or as contained in any notice of redemption or exchange and that
reliance may be placed only on the other identification numbers printed on the
Notes. The Company shall promptly notify the Trustee of any change in any such
"CUSIP", "CINS" or "ISIN" numbers or common codes for the Notes.
SECTION 2.14. DEFAULTED INTEREST. If the Company defaults in a payment of
interest on the Notes, it shall pay, or shall deposit with the Paying Agent
money in immediately available funds sufficient to pay, the defaulted interest,
plus (to the extent lawful) any interest payable on
44
the defaulted interest, to the Persons who are Holders on a subsequent special
record date. A special record date, as used in this Section 2.14 with respect to
the payment of any defaulted interest, shall mean the 15th day next preceding
the date fixed by the Company for the payment of defaulted interest, whether or
not such day is a Business Day. At least 15 days before the subsequent special
record date, the Company shall mail to each Holder and to the Trustee a notice
that states the subsequent special record date, the payment date and the amount
of defaulted interest to be paid.
SECTION 2.15. ISSUANCE OF ADDITIONAL NOTES. The Company may, subject to
Article Four of this Indenture and applicable law, issue additional Notes under
this Indenture (the "ADDITIONAL NOTES"). The Notes issued on the Closing Date,
any Exchange Notes and any Additional Notes subsequently issued shall be treated
as a single class for all purposes under this Indenture.
ARTICLE THREE
REDEMPTION
SECTION 3.01. RIGHT OF REDEMPTION. (a) The Notes are redeemable, at the
Company's option, in whole or in part, at any time or from time to time, on or
after February 15, 2004 and prior to maturity, upon not less than 30 nor more
than 60 days' prior notice mailed by first-class mail to each Holder's last
address, as it appears in the Security Register, at the following Redemption
Prices (expressed in percentages of principal amount), plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders of
record on the relevant Regular Record Date that is on or prior to the Redemption
Date to receive interest due on an Interest Payment Date), if redeemed during
the 12-month period commencing February 15 of the years set forth below:
Redemption
Year Price
---- -----
2004........................................ 106.625%
2005........................................ 104.417
2006........................................ 102.208
2007 and thereafter......................... 100.000
(b) In addition, at any time prior to February 15, 2002, the Company at its
option may redeem Notes in an aggregate principal amount equal to up to 35% of
the principal amount of the Notes (including the principal amount of any
Additional Notes), with funds in an amount equal to the proceeds of one or more
sales of Capital Stock (other than Disqualified Stock) of, or capital
contributions to, the Company, at any time or from time to time in part, at a
Redemption Price (expressed as a percentage of principal amount) of 113.25%,
plus accrued and unpaid interest if any, to the Redemption Date (subject to the
rights of Holders of record on the relevant Regular
45
Record Date that is prior to the Redemption Date to receive interest due on an
Interest Payment Date); PROVIDED that (i) an aggregate principal amount equal to
at least 65% of the principal amount of the initially issued Notes (plus the
principal amount of any Additional Notes) remains outstanding after each such
redemption and (ii) notice of such redemption is mailed within 60 days of each
such sale or capital contribution.
(c) In the event that (i) as a result of any change in, or amendments to,
any laws or treaties (or any regulations or rulings promulgated thereunder) or
any change in official position regarding the application of such laws,
treaties, regulations or rulings (including a holding, judgement or order by a
court of competent jurisdiction), which change, amendment, application or
interpretation becomes effective after the Closing Date, the Company has become
or would become obligated to pay, on the next date on which any amount would be
payable under or with respect to the Notes, any Additional Amounts, and (ii) the
Company cannot reasonably arrange (without other material adverse consequences
to the Company) for another obligor to make such payment so as to avoid the
requirement to pay such Additional Amounts, then the Company may redeem all, but
not less than all, the Notes at any time at 100% of the principal amount
thereof, together with accrued interest thereon, if any, to the Redemption Date.
SECTION 3.02. NOTICES TO TRUSTEE. If the Company elects to redeem Notes
pursuant to Section 3.01, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed and the clause
of this Indenture pursuant to which redemption shall occur.
The Company shall give each notice provided for in this Section 3.02 in an
Officers' Certificate at least 45 days before the Redemption Date (unless a
shorter period shall be satisfactory to the Trustee).
SECTION 3.03. SELECTION OF NOTES TO BE REDEEMED. If less than all of the
Notes are to be redeemed at any time, the Trustee shall select the Notes to be
redeemed in compliance with the requirements, as certified to it by the Company,
of the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not listed on a national securities exchange or
automated quotation system, by lot or in accordance with the Trustee's usual
procedures; PROVIDED that no Note of $1,000 in principal amount or less shall be
redeemed in part.
The Trustee shall make the selection from the Notes outstanding and not
previously called for redemption. Notes in denominations of $1,000 in principal
amount may only be redeemed in whole. The Trustee may select for redemption
portions (equal to $1,000 in principal amount or any integral multiple thereof)
of Notes that have denominations larger than $1,000 in principal amount.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption. The Trustee shall notify the
Company and the Registrar promptly in writing of the Notes or portions of Notes
to be called for redemption.
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SECTION 3.04. NOTICE OF REDEMPTION. With respect to any redemption of Notes
pursuant to Section 3.01, at least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail a notice of redemption by first-class
mail to each Holder whose Notes are to be redeemed.
The notice shall identify the Notes to be redeemed, including the portion
of the principal amount thereof, and shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the name and address of the Paying Agent;
(iv) that Notes called for redemption must be surrendered to the
Paying Agent in order to collect the Redemption Price;
(v) that, unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date and the only remaining right of the Holders is to
receive payment of the Redemption Price plus accrued interest to the
Redemption Date upon surrender of the Notes to the Paying Agent;
(vi) that, if any Note is being redeemed in part, the portion of the
principal amount (equal to $1,000 in principal amount or any integral
multiple thereof) of such Note to be redeemed and that, on and after the
Redemption Date, upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion thereof will be reissued;
and
(vii) that, if any Note contains a CUSIP, CINS or ISIN number or
common code as provided in Section 2.13, no representation is being made as
to the correctness of the CUSIP, CINS or ISIN number or common code either
as printed on the Notes or as contained in the notice of redemption and
that reliance may be placed only on the other identification numbers
printed on the Notes.
At the Company's request (which request may be revoked by the Company at
any time prior to the time at which the Trustee shall have given such notice to
the Holders), made in writing to the Trustee at least 45 days (or such shorter
period as shall be satisfactory to the Trustee) before a Redemption Date, the
Trustee shall give the notice of redemption in the name and at the expense of
the Company. If, however, the Company gives such notice to the Holders, the
Company shall concurrently deliver to the Trustee an Officers' Certificate
stating that such notice has been given.
47
SECTION 3.05. EFFECT OF NOTICE OF REDEMPTION. Once notice of redemption is
mailed, Notes called for redemption become due and payable on the Redemption
Date and at the Redemption Price. Upon surrender of any Notes to the Paying
Agent, such Notes shall be paid at the Redemption Price, plus accrued interest,
if any, to the Redemption Date.
Notice of redemption shall be deemed to be given when mailed, whether or
not the Holder receives the notice. In any event, failure to give such notice,
or any defect therein, shall not affect the validity of the proceedings for the
redemption of Notes held by Holders to whom such notice was properly given.
SECTION 3.06. DEPOSIT OF REDEMPTION PRICE. At least one Business Day prior
to any Redemption Date, the Company shall deposit with the Paying Agent (or, if
the Company is acting as its own Paying Agent, shall segregate and hold in trust
as provided in Section 2.05) U.S. dollars in immediately available funds
sufficient to pay the Redemption Price of and accrued interest on all Notes to
be redeemed on that date other than Notes or portions thereof called for
redemption on that date that have been delivered by the Company to the Trustee
for cancellation.
SECTION 3.07. PAYMENT OF NOTES CALLED FOR REDEMPTION. If notice of
redemption has been given in the manner provided above, the Notes or portion of
Notes specified in such notice to be redeemed shall become due and payable on
the Redemption Date at the Redemption Price stated therein, together with
accrued interest to such Redemption Date, and on and after such date (unless the
Company shall default in the payment of such Notes at the Redemption Price and
accrued interest to the Redemption Date, in which case the principal, until
paid, shall bear interest from the Redemption Date at the rate prescribed in the
Notes), such Notes shall cease to accrue interest. Upon surrender of any Note
for redemption in accordance with a notice of redemption, such Note shall be
paid and redeemed by the Company at the Redemption Price, together with accrued
interest, if any, to the Redemption Date; PROVIDED that installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders registered as such at the close of business on the relevant Regular
Record Date.
SECTION 3.08. NOTES REDEEMED IN PART. Upon surrender of any Note that is
redeemed in part, the Company shall execute and the Trustee shall authenticate
and deliver to the Holder without service charge, a new Note equal in principal
amount to the unredeemed portion of such surrendered Note.
ARTICLE FOUR
COVENANTS
SECTION 4.01. PAYMENT OF NOTES. The Company shall pay the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes and this
48
Indenture. An installment of principal, premium, if any, or interest shall be
considered paid on the date due if the Trustee or Paying Agent (other than the
Company, a Subsidiary of the Company, or any Affiliate of any of them) holds on
that date money designated for and sufficient to pay the installment. If the
Company or any Subsidiary of the Company or any Affiliate of any of them acts as
Paying Agent, an installment of principal, premium, if any, or interest shall be
considered paid on the due date if the entity acting as Paying Agent complies
with the last sentence of Section 2.05. As provided in Section 6.09, upon any
bankruptcy or reorganization procedure relative to the Company, the Trustee
shall serve as the Paying Agent, if any, for the Notes.
The Company shall pay interest on overdue principal and premium, if any,
and interest on overdue installments of interest, to the extent lawful, at the
rate per annum specified in the Notes.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY. The Company will maintain in
the Borough of Manhattan, The City of New York an office or agency where Notes
may be surrendered for registration of transfer or exchange or for presentation
for payment and where notices and demands to or upon the Company in respect of
the Notes and this Indenture may be served. The Company will give prompt written
notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the address of the Trustee set forth in Section 11.02.
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 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.
The Company hereby initially designates the Corporate Trust Office of the
Trustee as such office of the Company in accordance with Section 2.04.
SECTION 4.03. LIMITATION ON INDEBTEDNESS.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, Incur any Indebtedness (other than the Notes and the Euro Notes
(including any Exchange Notes and any Exchange Notes (as defined in the Euro
Notes Indenture), but excluding any Additional Notes or Additional Notes (as
defined in the Euro Notes Indenture), and other Indebtedness
49
existing on the Closing Date); PROVIDED that the Company or any Permanent
Guarantor may Incur Indebtedness if, after giving effect to the Incurrence of
such Indebtedness and the receipt and application of the proceeds therefrom, the
Consolidated Leverage Ratio would be greater than zero and less than 6:1.
Notwithstanding the foregoing, the Company and any Restricted Subsidiary
(except as specified below) may Incur each and all of the following:
(i) Indebtedness outstanding at any time in an aggregate principal
amount not to exceed (after giving effect to any refinancing thereof) the
sum of (a) $100 million, less any amount of such Indebtedness permanently
repaid as provided under Section 4.11 of this Indenture, plus (b) an amount
equal to the lesser of (1) 80% of the consolidated book value of the
accounts receivable of the Company and its Restricted Subsidiaries
determined in accordance with GAAP (determined as of the end of the most
recently ended fiscal quarter for which reports have been filed with the
Commission or provided to the Trustee) and (2) $100 million;
(ii) Indebtedness owed (A) to the Company evidenced by a promissory
note or (B) to any Restricted Subsidiary; PROVIDED that any event which
results in any such Restricted Subsidiary ceasing to be a Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to
the Company or another Restricted Subsidiary) shall be deemed, in each
case, to constitute an Incurrence of such Indebtedness not permitted by
this clause (ii);
(iii) Indebtedness issued to refinance then outstanding Indebtedness
(other than Indebtedness Incurred under clause (i), (ii), (iv), (vi),
(viii), (xi) or (xii) of this paragraph) and any refinancings thereof, in
an amount not to exceed the amount so refinanced (plus premiums, accrued
interest, fees and expenses); PROVIDED that Indebtedness the proceeds of
which are used to refinance the Notes in part or Indebtedness that is PARI
PASSU with, or expressly subordinated in right of payment to, the Notes or
any Notes Guarantee shall only be permitted under this clause (iii) if (A)
in case the Notes are refinanced in part or the Indebtedness to be
refinanced is PARI PASSU with the Notes or any Notes Guarantee, such new
Indebtedness, by its terms or by the terms of any agreement or instrument
pursuant to which such new Indebtedness is outstanding, is expressly made
PARI PASSU with, or expressly subordinate in right of payment to, the
remaining Notes or any Notes Guarantee, (B) in case the Indebtedness to be
refinanced is expressly subordinated in right of payment to the Notes or
any Notes Guarantee, such new Indebtedness, by its terms or by the terms of
any agreement or instrument pursuant to which such new Indebtedness is
issued or remains outstanding, is expressly made subordinate in right of
payment to the Notes or any Notes Guarantee at least to the extent that the
Indebtedness to be refinanced is subordinated to the Notes or any Notes
Guarantee and (C) such new Indebtedness, determined as of the date of
Incurrence of such new Indebtedness, does not mature prior
50
to the Stated Maturity of the Indebtedness to be refinanced and the Average
Life of such new Indebtedness is at least equal to the remaining Average
Life of the Indebtedness to be refinanced; and PROVIDED FURTHER that in no
event may Indebtedness of the Company be refinanced by means of any
Indebtedness of any Restricted Subsidiary pursuant to this clause (iii);
(iv) Indebtedness (A) in respect of performance, surety, appeal or
other similar bonds provided in the ordinary course of business and (B)
arising from agreements providing for indemnification, adjustment of
purchase price or similar obligations, or from Guarantees or letters of
credit, bankers' acceptances, surety or performance bonds or other similar
instruments securing any obligations of the Company or any of its
Restricted Subsidiaries pursuant to such agreements, in any case Incurred
in connection with the disposition of any business, assets or Restricted
Subsidiary (other than Guarantees of Indebtedness Incurred by any Person
acquiring all or any portion of such business, assets or Restricted
Subsidiary for the purpose of financing such acquisition), in a principal
amount not to exceed the gross proceeds actually received by the Company or
any Restricted Subsidiary in connection with such disposition;
(v) Indebtedness of the Company or any Permanent Guarantor, to the
extent the net proceeds thereof are promptly (A) used to purchase Notes
tendered in an Offer to Purchase made as a result of a Change in Control or
to purchase Euro Notes tendered in an offer to purchase under the Euro
Notes Indenture or (B) deposited to defease the Notes as described under
Article Eight;
(vi) Guarantees of the Notes and Guarantees of Indebtedness of the
Company by any Restricted Subsidiary provided the Guarantee of such
Indebtedness is permitted by and made in accordance with Section 4.07; and
Guarantees of Indebtedness of any Restricted Subsidiary by any Restricted
Subsidiary provided such Restricted Subsidiary simultaneously executes and
delivers a supplemental indenture to this Indenture providing for a
Guarantee of payment of the Notes by such Restricted Subsidiary;
(vii) Indebtedness (including Guarantees and the German Network L/C)
Incurred to finance or refinance the cost (including the cost of design,
development, acquisition, construction, installation, improvement,
transportation or integration) to acquire equipment, inventory or network
assets (including leases on an indefeasible right-to-use basis and multiple
investment units) (including acquisitions by way of Capitalized Lease and
acquisitions of the Capital Stock of a Person that becomes a Restricted
Subsidiary to the extent of the fair market value of the equipment,
inventory or network assets so acquired) by the Company or a Restricted
Subsidiary;
51
(viii) Indebtedness of the Company or any Permanent Guarantor not to
exceed, at any one time outstanding (after giving effect to any refinancing
thereof), two times the sum of (A) the Net Cash Proceeds received by the
Company after the Closing Date as a capital contribution or from the
issuance and sale of its Capital Stock (other than Disqualified Stock) to a
Person that is not a Subsidiary of the Company, to the extent (I) such
capital contribution or Net Cash Proceeds have not been used pursuant to
clause (C)(2) of the first paragraph or clause (iii), (iv), (vi) or (x) of
the second paragraph of Section 4.04 to make a Restricted Payment and (II)
if such capital contribution or Net Cash Proceeds are used to consummate a
transaction pursuant to which the Company Incurs Acquired Indebtedness, the
amount of such Net Cash Proceeds exceeds one-half of the amount of Acquired
Indebtedness so Incurred and (B) 80% of the fair market value of property
(other than cash and cash equivalents) received by the Company after the
Closing Date as a capital contribution or from the sale of its Capital
Stock (other than Disqualified Stock) to a Person that is not a Subsidiary
of the Company, to the extent (I) such capital contribution or sale of
Capital Stock has not been used pursuant to clause (iii), (iv) or (vii) of
the second paragraph of Section 4.04 to make a Restricted Payment and (II)
if such capital contribution or Capital Stock is used to consummate a
transaction pursuant to which the Company Incurs Acquired Indebtedness, 80%
of the fair market value of the property received exceeds one-half of the
amount of Acquired Indebtedness so Incurred PROVIDED that such Indebtedness
does not mature prior to the Stated Maturity of the Notes and has an
Average Life longer than the Notes;
(ix) Acquired Indebtedness;
(x) Strategic Subordinated Indebtedness;
(xi) Indebtedness in respect of bankers' acceptance and letters of
credit, all in the ordinary course of business, in an aggregate amount
outstanding at any time not to exceed $10 million; and
(xii) subordinated Indebtedness of the Company or any Permanent
Guarantor (in addition to Indebtedness permitted under clauses (i) through
(xi) above) in an aggregate principal amount outstanding at any time (after
giving effect to any refinancing thereof) not to exceed $100 million.
(b) For purposes of determining compliance with any Dollar-denominated
restriction on the Incurrence of Indebtedness denominated in another currency,
the Dollar-equivalent principal amount of such Indebtedness Incurred pursuant
thereto shall be calculated based on the relevant currency exchange rate in
effect on the date that such Indebtedness was Incurred (or, in the case of
Indebtedness under a revolving credit facility, at the time of commitment),
PROVIDED that if such Indebtedness is Incurred to refinance other Indebtedness
denominated in a foreign
52
currency, and such refinancing would cause the applicable Dollar-denominated
restriction to be exceeded if calculated at the relevant currency exchange rate
in effect on the date of such refinancing, such 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 from 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.
(c) For purposes of determining any particular amount of Indebtedness under
this Section 4.03, (1) Guarantees, Liens or obligations with respect to letters
of credit, bankers' acceptances or other similar instruments supporting
Indebtedness otherwise included in the determination of such particular amount
shall not be included and (2) any Liens granted pursuant to the equal and
ratable provisions referred to in Section 4.09 of this Indenture shall not be
treated as giving rise to Indebtedness. For purposes of determining compliance
with this Section 4.03, (1) any other obligation of the obligor on such
Indebtedness arising under any Lien or letter of credit, bankers' acceptance or
other similar instrument or obligation supporting such Indebtedness shall be
disregarded to the extent that the same secures the principal amount of such
Indebtedness and (2) in the event that an item of Indebtedness meets the
criteria of more than one of the types of Indebtedness described in the above
clauses, the Company, in its sole discretion, shall classify, and from time to
time may reclassify, such item of Indebtedness and only be required to include
the amount and type of such Indebtedness in one of such clauses (but may
allocate portions of such Indebtedness between or among such clauses).
SECTION 4.04. LIMITATION ON RESTRICTED PAYMENTS. The Company will not, and
will not permit any Restricted Subsidiary to, directly or indirectly, (i)
declare or pay any dividend or make any distribution on or with respect to its
Capital Stock (other than (x) dividends or distributions payable solely in
shares of its Capital Stock (other than Disqualified Stock) or in options,
warrants or other rights to acquire shares of such Capital Stock and (y)
dividends or distributions on Capital Stock of a Restricted Subsidiary held by
minority interest holders on no more than a pro rata basis, measured by value
and based on all outstanding Capital Stock of such Restricted Subsidiary) held
by Persons other than the Company or any of its Restricted Subsidiaries, (ii)
purchase, redeem, retire or otherwise acquire for value any shares of Capital
Stock of (A) the Company or an Unrestricted Subsidiary (including options,
warrants or other rights to acquire such shares of Capital Stock) held by any
Person other than the Company or any Wholly Owned Restricted Subsidiary or (B) a
Restricted Subsidiary (including options, warrants or other rights to acquire
such shares of Capital Stock) held by any Affiliate of the Company (other than a
Wholly Owned Restricted Subsidiary) or any holder (or any Affiliate of such
holder) of 5% or more of the Capital Stock of the Company, (iii) make any
voluntary or optional principal payment, or voluntary or optional redemption,
repurchase, defeasance, or other acquisition or retirement for value, of
53
Indebtedness of the Company that is expressly subordinated in right of payment
to the Notes or any Notes Guarantee or (iv) make any Investment, other than a
Permitted Investment, in any other Person (such payments or any other actions
described in clauses (i) through (iv) above being collectively "Restricted
Payments") if, at the time of, and after giving effect to, the proposed
Restricted Payment: (A) a Default or Event of Default shall have occurred and be
continuing, (B) the Company could not Incur at least $1.00 of Indebtedness under
the first paragraph of Section 4.03 or (C) the aggregate amount of all
Restricted Payments (the amount, if other than in cash, to be determined in good
faith by the Board of Directors, whose determination shall be conclusive and
evidenced by a Board Resolution) made after the Closing Date shall exceed the
sum of (1) 50% of the aggregate amount of the Adjusted Consolidated Net Income
(or, if the Adjusted Consolidated Net Income is a loss, minus 100% of the amount
of such loss) accrued on a cumulative basis during the period (taken as one
accounting period) beginning on the first day of the fiscal quarter beginning
immediately following the Closing Date and ending on the last day of the last
fiscal quarter preceding the Transaction Date for which reports have been filed
with the Commission or provided to the Trustee pursuant to Section 4.18 PLUS (2)
the aggregate Net Cash Proceeds received by the Company after the Closing Date
as a capital contribution or from the issuance and sale permitted by this
Indenture of its Capital Stock (other than Disqualified Stock) to a Person who
is not a Subsidiary of the Company, including the proceeds of an issuance or
sale permitted by this Indenture of Indebtedness of the Company for cash
subsequent to the Closing Date upon the conversion of such Indebtedness into
Capital Stock (other than Disqualified Stock) of the Company, or from the
issuance to a Person who is not a Subsidiary of the Company of any options,
warrants or other rights to acquire Capital Stock of the Company (in each case,
exclusive of any Disqualified Stock or any options, warrants or other rights
that are redeemable at the option of the holder, or are required to be redeemed,
prior to the Stated Maturity of the Notes), in each case except to the extent
such Net Cash Proceeds are used to Incur Indebtedness pursuant to clause (viii)
of the second paragraph under Section 4.03 PLUS (3) an amount equal to the net
reduction in Investments (other than reductions in Permitted Investments and
Investments under clause (vi), (viii) or (xii) of the second paragraph of this
Section 4.04) in any Person resulting from payments of interest on Indebtedness,
dividends, distributions, repayments of loans or advances, or other transfers of
assets, in each case to the Company or any Restricted Subsidiary or from the Net
Cash Proceeds from the sale or other disposition of any such Investment (except,
in each case, to the extent of any gain on such sale or other disposition that
would be included in the calculation of Adjusted Consolidated Net Income for
purposes of clause (C)(1) above), or from redesignations of Unrestricted
Subsidiaries as Restricted Subsidiaries (valued in each case as provided in the
definition of "Investments"), not to exceed, in each case, the amount of
Investments previously made by the Company or any Restricted Subsidiary in such
Person or Unrestricted Subsidiary.
The foregoing provision shall not be violated by reason of:
54
(i) the payment of any dividend within 60 days after the date of
declaration thereof if, at said date of declaration, such payment would
comply with the foregoing paragraph;
(ii) the redemption, repurchase, defeasance or other acquisition or
retirement for value of Indebtedness that is subordinated in right of
payment to the Notes or any Notes Guarantee, including premium, if any, and
accrued and unpaid interest, with the proceeds of, or in exchange for,
Indebtedness Incurred under clause (iii) of the second paragraph of Section
4.03;
(iii) the repurchase, redemption or other acquisition of Capital Stock
of the Company or any Subsidiary of the Company (or options, warrants or
other rights to acquire such Capital Stock) in exchange for, or out of the
proceeds of a capital contribution or a substantially concurrent offering
of, shares of Capital Stock (other than Disqualified Stock) of the Company
(or options, warrants or other rights to acquire such Capital Stock);
(iv) the making of any principal payment on or the repurchase,
redemption, retirement, defeasance or other acquisition for value of
Indebtedness of the Company which is subordinated in right of payment to
the Notes in exchange for, or out of the proceeds of a capital contribution
or a substantially concurrent offering of, shares of the Capital Stock
(other than Disqualified Stock) of the Company (or options, warrants or
other rights to acquire such Capital Stock);
(v) payments or distributions to dissenting shareholders pursuant to
applicable law, pursuant to or in connection with a consolidation, merger
or transfer of assets that complies with the provisions of Article Five of
this Indenture;
(vi) any Investment in any Person the primary business of which is
related, ancillary or complementary to the business of the Company and its
Restricted Subsidiaries on the date of such Investment; PROVIDED that the
aggregate amount of Investments made pursuant to this clause (vi) does not
exceed the sum of (a) $25 million, plus (b) the amount of Net Cash Proceeds
received by the Company after the Closing Date as a capital contribution or
from the sale of its Capital Stock (other than Disqualified Stock) to a
Person who is not a Subsidiary of the Company, except to the extent such
Net Cash Proceeds are used to Incur Indebtedness pursuant to clause (viii)
of the second paragraph under Section 4.03 or to make Restricted Payments
pursuant to clause (C)(2) of the first paragraph, or clauses (iii), (iv) or
(x) of this paragraph, of this Section 4.04, plus (c) the net reduction in
Investments made pursuant to this clause (vi) resulting from distributions
on or repayments of such Investments or from the Net Cash Proceeds from the
sale or other disposition of any such Investment (except in each case to
the extent of any gain on such sale or other disposition that would be
included in the calculation of Adjusted Consolidated Net Income for
purposes of clause (C)(1) above) or from such Person
55
becoming a Restricted Subsidiary (valued in each case as provided in the
definition of "Investments"), PROVIDED that the net reduction in any
Investment shall not exceed the amount of such Investment;
(vii) Investments acquired as a capital contribution to or in exchange
for Capital Stock (other than Disqualified Stock) of the Company;
(viii) Investments in Permitted Joint Ventures not exceeding, at the
time of the Investment, the sum of (A) $10 million and (B) the net
reduction in Investments made pursuant to this clause (viii) resulting from
distributions on or repayments of such Investments or from the Net Cash
Proceeds from the sale or other disposition of any such Investment (except
in each case to the extent of any gain on such sale or disposition that
would be included in the calculation of Adjusted Consolidated Net Income
for purposes of clause (C)(1) above) or from such Person becoming a
Restricted Subsidiary (valued in each case as provided in the definition of
"Investments"), PROVIDED that the net reduction in any Investment shall not
exceed the amount of such Investment;
(ix) repurchases of Warrants pursuant to a Repurchase Offer or within
ten days of their expiration in accordance with the terms of the Warrant
Agreements in effect on the Closing Date, and any purchase of any
fractional shares of Common Stock (or other Capital Stock of the Company
issuable upon exercise of the Warrants) in connection with an exercise of
the Warrants and any payments in connection with the anti-dilution
provisions of the Warrant Agreements;
(x) the purchase, redemption, retirement or other acquisition for
value of shares of Capital Stock of the Company or options, warrants or
other rights to purchase such shares held by Management Investors upon
death, disability, retirement, termination of employment or pursuant to the
terms of any agreement under which such shares of Capital Stock or options,
warrants or other rights were issued; PROVIDED that the aggregate
consideration paid for such purchase, redemption, retirement or other
acquisition for value of such shares or options, warrants or other rights
after the Closing Date does not in the aggregate exceed (A) $5 million,
plus (B) the aggregate Net Cash Proceeds received by the Company after the
Closing Date as a capital contribution from, or from the issuance or sale
to, Management Investors of Capital Stock of the Company or any options,
warrants or other rights to acquire such Capital Stock, plus (C) the
proceeds of insurance policies used to effect any such purchase,
redemption, retirement or other acquisition;
(xi) any purchase, redemption, retirement or other acquisition of
Capital Stock deemed to occur upon the exercise of options, warrants or
other rights if such Capital Stock represents a portion of the exercise
price thereof; or
56
(xii) other Restricted Payments in an aggregate amount not to exceed
$5 million plus the net reduction in Investments made pursuant to this
clause (xii) resulting from distributions on or repayments of such
Investments or from the Net Cash Proceeds from the sale or other
disposition of any such Investment (except in each case to the extent of
any gain on such sale or disposition that would be included in the
calculation of Adjusted Consolidated Net Income for purposes of clause
(C)(1) above) or from such Person becoming a Restricted Subsidiary (valued
in each case as provided in the definition of "Investments"), PROVIDED that
the net reduction in any Investment shall not exceed the amount of such
Investment;
PROVIDED that, except in the case of clauses (i), (iii) and (xi), no Default or
Event of Default shall have occurred and be continuing or occur as a consequence
of the actions or payments set forth therein.
Each Restricted Payment permitted pursuant to the preceding paragraph
(other than the Restricted Payment referred to in clause (ii) thereof, an
exchange of Capital Stock for Capital Stock or Indebtedness referred to in
clause (iii) or (iv) thereof, an Investment referred to in clause (vii) thereof
and a purchase, redemption, retirement or other acquisition of Capital Stock
referred to in clause (xi) thereof), and the Net Cash Proceeds from any capital
contribution or any issuance of Capital Stock referred to in clauses (iii), (iv)
and (vi) thereof, shall be included in calculating whether the conditions of
clause (C) of the first paragraph of this Section 4.04 have been met with
respect to any subsequent Restricted Payments.
SECTION 4.05. LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS
AFFECTING RESTRICTED SUBSIDIARIES. The Company will not, and will not permit any
Restricted Subsidiary to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any Restricted Subsidiary to (i) pay dividends or make any other
distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,
(ii) pay any Indebtedness owed to the Company or any other Restricted
Subsidiary, (iii) make loans or advances to the Company or any other Restricted
Subsidiary or (iv) transfer any of its property or assets to the Company or any
other Restricted Subsidiary.
The foregoing provisions shall not restrict any encumbrances or
restrictions:
(i) existing on the Closing Date, including under this Indenture, the
Euro Notes Indenture or any other agreements or instruments in effect on
the Closing Date, and any refinancings of such agreements or instruments;
PROVIDED that the encumbrances and restrictions in any such refinancings
are no less favorable in any material respect to the Holders than those
encumbrances or restrictions that are then in effect and that are being
refinanced;
57
(ii) existing under or by reason of applicable law or any requirement
of any applicable governmental regulatory authority;
(iii) existing with respect to any Person, or any property or assets,
acquired by the Company or any Restricted Subsidiary, existing at the time
of such acquisition and not incurred in contemplation thereof, which
encumbrances or restrictions are not applicable (A) in the case of an
acquisition of such Person, to any other Person or (B) in the case of an
acquisition of such property or assets, any other property or assets;
(iv) in the case of clause (iv) (and, solely with respect to clauses
(A), (B) and (D) of this clause (iv), clause (i)) of the first paragraph of
this Section 4.05, (A) that restrict in a customary manner the subletting,
assignment or transfer of any property or asset that is, or is subject to,
a lease, license, conveyance or contract or similar property or asset, (B)
existing by virtue of any transfer of, agreement to transfer, option or
right with respect to, or Lien on, any property or assets of the Company or
any Restricted Subsidiary not otherwise prohibited by this Indenture, (C)
arising or agreed to in the ordinary course of business, not relating to
any Indebtedness, and that do not, individually or in the aggregate,
detract from the value of property or assets of the Company or any
Restricted Subsidiary in any manner material to the Company or any
Restricted Subsidiary or (D) arising under the terms of Indebtedness
Incurred under clause (vii) of the second paragraph of Section 4.03 that
restrict the transfer of the property or assets acquired with such
Indebtedness;
(v) with respect to a Restricted Subsidiary and imposed pursuant to an
agreement that has been entered into for the sale or disposition of all or
substantially all of the Capital Stock of, or property and assets of, such
Restricted Subsidiary;
(vi) contained in the terms of any Indebtedness or any agreement
pursuant to which such Indebtedness was issued, or any agreement relating
to the sale, disposition or financing of receivables, if (A) either (1) the
encumbrance or restriction applies only in the event of a payment default
or a default with respect to a financial covenant contained in the terms of
such Indebtedness or agreement or (2) the Company in good faith determines
(as set forth in a Board Resolution) that any such encumbrance or
restriction will not materially affect the Company's ability to make
principal or interest payments on the Notes and (B) the encumbrance or
restriction is not materially more disadvantageous to the Holders of the
Notes than is customary in comparable financings (as determined by the
Company in good faith);
(vii) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business;
or
58
(viii) customary provisions in joint venture agreements and other
similar agreements entered into in the ordinary course of business.
Nothing contained in this Section 4.05 shall prevent the Company or any
Restricted Subsidiary from (1) creating, incurring, assuming or suffering to
exist any Liens otherwise permitted under Section 4.09 or (2) restricting the
sale or other disposition of property or assets of the Company or any of its
Restricted Subsidiaries that secure Indebtedness of the Company or any of its
Restricted Subsidiaries.
SECTION 4.06. LIMITATION ON THE ISSUANCE AND SALE OF CAPITAL STOCK OF
RESTRICTED SUBSIDIARIES. The Company will not sell, and will not permit any
Restricted Subsidiary, directly or indirectly, to issue or sell, any shares of
Capital Stock of a Restricted Subsidiary (including options, warrants or other
rights to purchase shares of such Capital Stock) except:
(i) to the Company or a Wholly Owned Restricted Subsidiary;
(ii) issuances of director's qualifying shares or issuances or sales
to foreign nationals of shares of Capital Stock of foreign Restricted
Subsidiaries, to the extent required by applicable law;
(iii) if, immediately after giving effect to such issuance or sale,
such Restricted Subsidiary would no longer constitute a Restricted
Subsidiary and any Investment in such Person remaining after giving effect
to such issuance or sale would have been permitted to be made under Section
4.04 if made on the date of such issuance or sale; or
(iv) issuances or sales of Common Stock of a Restricted Subsidiary,
provided that the Company or such Restricted Subsidiary applies the Net
Cash Proceeds, if any, of any such sale in accordance with clause (A) or
(B) of Section 4.11 of this Indenture.
SECTION 4.07. LIMITATION ON ISSUANCES OF GUARANTEES BY RESTRICTED
SUBSIDIARIES. The Company will not permit any Restricted Subsidiary, directly or
indirectly, to Guarantee any Indebtedness of the Company or any Subsidiary
Guarantor which is PARI PASSU with or expressly subordinate in right of payment
to the Notes or any Notes Guarantee ("Guaranteed Indebtedness"), unless (i) such
Restricted Subsidiary simultaneously executes and delivers a supplemental
indenture to this Indenture providing for a Guarantee (a "Subsidiary Guarantee")
of payment of the Notes by such Restricted Subsidiary and (ii) such Restricted
Subsidiary waives and will not in any manner whatsoever claim or take the
benefit or advantage of, any rights of reimbursement, indemnity or subrogation
or any other rights against the Company or any other Restricted Subsidiary as a
result of any payment by such Restricted Subsidiary under its Subsidiary
Guarantee, until payment in full of the outstanding principal amount of such
Notes and any premium or accrued and unpaid interest thereon then due and owing;
PROVIDED that this paragraph
59
shall not be applicable to any Guarantee of any Restricted Subsidiary (a) that
existed at the time such Person became a Restricted Subsidiary and was not
Incurred in connection with, or in contemplation of, such Person becoming a
Restricted Subsidiary or (b) of Indebtedness Incurred pursuant to clause (i) of
the second paragraph of Section 4.03. If the Guaranteed Indebtedness is (A) PARI
PASSU with the Notes, then the Guarantee of such Guaranteed Indebtedness shall
be PARI PASSU with, or subordinated to, the Subsidiary Guarantee or (B)
subordinated to the Notes, then the Guarantee of such Guaranteed Indebtedness
shall be subordinated to the Subsidiary Guarantee at least to the extent that
the Guaranteed Indebtedness is subordinated to the Notes.
Notwithstanding the foregoing, any Subsidiary Guarantee by a Restricted
Subsidiary may provide by its terms that it shall be automatically and
unconditionally released and discharged upon (i) any sale, exchange or transfer
(including by way of merger or consolidation), to any Person not an Affiliate of
the Company, of all of the Company's and each Restricted Subsidiary's Capital
Stock in, or all or substantially all the assets of, such Restricted Subsidiary
(which sale, exchange, transfer or other transaction is not prohibited by this
Indenture), (ii) the legal or covenant defeasance of the Notes or satisfaction
and discharge of this Indenture, subject to customary contingent reinstatement
provisions, (iii) the release or discharge of the Guarantee which resulted in
the creation of such Subsidiary Guarantee, except a discharge or release by or
as a result of payment under such Guarantee or (iv) upon the merger or
consolidation of such Subsidiary Guarantor with and into the Company or another
Subsidiary Guarantor that is the surviving Person in such merger or
consolidation.
SECTION 4.08. LIMITATION ON TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.
The Company will not, and will not permit any Restricted Subsidiary to, directly
or indirectly, enter into, renew or extend any transaction (including, without
limitation, the purchase, sale, lease or exchange of property or assets, or the
rendering of any service) with any holder (or any Affiliate of such holder) of
5% or more of any class of Capital Stock of the Company or with any Affiliate of
the Company or any Restricted Subsidiary, except upon fair and reasonable terms
that taken as a whole are no less favorable to the Company or such Restricted
Subsidiary than could be obtained, at the time of such transaction or, if such
transaction is pursuant to a written agreement, at the time of the execution of
the agreement providing therefor, in a comparable arm's-length transaction with
a Person that is not such a holder or an Affiliate.
The foregoing limitation does not limit, and shall not apply to:
(i) transactions (A) approved by a majority of the disinterested
members of the Board of Directors or (B) for which the Company or a
Restricted Subsidiary delivers to the Trustee a written opinion of a
nationally recognized investment banking or appraisal firm stating that the
transaction is fair to the Company or such Restricted Subsidiary from a
financial point of view, or is upon terms that taken as a whole are no less
favorable to
60
the Company or such Restricted Subsidiary than could be obtained in a
comparable arm's-length transaction;
1 (ii) any transaction solely between or among the Company and any of
its Wholly Owned Restricted Subsidiaries or solely between or among Wholly
Owned Restricted Subsidiaries;
(iii) the payment of reasonable and customary regular fees to
directors of the Company who are not employees of the Company;
(iv) any payments or other transactions pursuant to any tax-sharing
agreement between the Company and any other Person with which the Company
files a consolidated tax return or with which the Company is part of a
consolidated group for tax purposes;
(v) any Restricted Payments (or a transaction excluded from the
definition of the term "Restricted Payments") not prohibited by Section
4.04;
(vi) transactions consisting of or pursuant to employment or benefit
agreements, plans, programs or arrangements for or with, or indemnification
or contribution obligations to, employees, officers or directors in the
ordinary course of business;
(vii) the entering into of the Securities Purchase and Cancellation
Agreement, the 1999 Share Option Plan, the Securities Purchase Agreement,
the Registration Rights Agreement and the Securityholders' Agreement, as
described in the Offering Memorandum dated February 12, 1999 as amended or
supplemented, and performance of the obligations and the transactions
contemplated thereby; or
(viii) issuances or sales of Capital Stock (other than Disqualified
Stock) of the Company or options, warrants or other rights to acquire such
Capital Stock.
Notwithstanding the foregoing, any transaction or series of related transactions
covered by the first paragraph of this Section 4.08 and not covered by clauses
(ii) through (viii) of this paragraph, the aggregate amount of which exceeds $2
million in value, must be approved or determined to be fair in the manner
provided for in clause (i)(A) or (B) above.
SECTION 4.09. LIMITATION ON LIENS. The Company will not, and will not
permit any Restricted Subsidiary to, create, incur, assume or suffer to exist
any Lien on any of its assets or properties of any character (including, without
limitation, licenses), or any shares of Capital Stock or Indebtedness of any
Restricted Subsidiary, without making effective provision for all of the Notes
and all other amounts due under this Indenture to be directly secured equally
and ratably
61
with (or, if the obligation or liability to be secured by such Lien is expressly
subordinated in right of payment to the Notes, prior to) the obligation or
liability secured by such Lien.
The foregoing limitation does not apply to:
(i) Liens existing on the Closing Date;
(ii) Liens granted after the Closing Date on any assets or Capital
Stock of the Company or its Restricted Subsidiaries created in favor of the
Holders;
(iii) Liens with respect to the assets of a Restricted Subsidiary
granted by such Restricted Subsidiary to the Company or a Wholly Owned
Restricted Subsidiary to secure Indebtedness owing to the Company or such
other Restricted Subsidiary;
(iv) Liens securing Indebtedness which is permitted to be Incurred
under clause (iii) of the second paragraph of Section 4.03 to refinance
secured Indebtedness; PROVIDED that such Liens do not extend to or cover
any property or assets of the Company or any Restricted Subsidiary other
than the property or assets securing the Indebtedness being refinanced;
(v) Liens on the Capital Stock of, or any property or assets of, a
Restricted Subsidiary securing Indebtedness of such Restricted Subsidiary
(or obligations in respect thereof) permitted under Section 4.03; or
(vi) Permitted Liens.
SECTION 4.10. LIMITATION ON SALE-LEASEBACK TRANSACTIONS. The Company will
not, and will not permit any Restricted Subsidiary to, enter into any
sale-leaseback transaction involving any of its assets or properties whether now
owned or hereafter acquired, whereby the Company or a Restricted Subsidiary
sells or transfers such assets or properties more than one year after acquiring
such assets or properties and then or thereafter leases such assets or
properties or any part thereof or any other assets or properties which the
Company or such Restricted Subsidiary, as the case may be, intends to use for
substantially the same purpose or purposes as the assets or properties sold or
transferred.
The foregoing restriction does not apply to any sale-leaseback transaction
if (i) the lease is for a period, including renewal rights, of not in excess of
three years; (ii) the lease secures or relates to industrial revenue or
pollution control bonds; (iii) the transaction is solely between the Company and
any Wholly Owned Restricted Subsidiary or solely between Wholly Owned Restricted
Subsidiaries; or (iv) the Company or such Restricted Subsidiary, within 12
months after the sale or transfer of any assets or properties is completed,
applies an amount not less than the
62
net proceeds received from such sale in accordance with clause (A) or (B) of the
second paragraph of Section 4.11 of this Indenture.
SECTION 4.11. LIMITATION ON ASSET SALES. The Company will not, and will not
permit any Restricted Subsidiary to, consummate any Asset Sale, unless (i) the
consideration received by the Company or such Restricted Subsidiary (including
any Released Indebtedness and including by way of relief from or by any other
Person assuming responsibilities for any liabilities other than Indebtedness
("Released Liabilities")) is at least equal to the fair market value of the
assets sold or disposed of; PROVIDED that this clause (i) shall not apply to any
sale, transfer or other disposition arising from foreclosure, condemnation or
similar action with respect to any assets and (ii) at least 75% of the
consideration received (including any Released Indebtedness and Released
Liabilities) consists of cash, Temporary Cash Investments or Released
Indebtedness and Released Liabilities; PROVIDED, HOWEVER, that this clause (ii)
shall not apply to long-term assignments in capacity in a telecommunications
network or other transfers of indefeasible rights of use, multiple investment
units or dark fibers.
In the event and to the extent that the Net Cash Proceeds received by the
Company or any of its Restricted Subsidiaries from one or more Asset Sales
occurring on or after the Closing Date in any period of 12 consecutive months
exceed 10% of Adjusted Consolidated Net Tangible Assets (determined as of the
date closest to the commencement of such 12-month period for which a
consolidated balance sheet of the Company and its Subsidiaries has been filed
with the Commission or provided to the Trustee pursuant to Section 4.18), then
the Company shall or shall cause the relevant Restricted Subsidiary to:
(i) within 12 months after the date Net Cash Proceeds so received
exceed 10% of Adjusted Consolidated Net Tangible Assets
(A) apply an amount equal to such excess Net Cash Proceeds to
permanently repay unsubordinated Indebtedness of the Company, or any
Restricted Subsidiary providing a Notes Guarantee or Indebtedness of
any other Restricted Subsidiary, in each case owing to a Person other
than the Company or any of its Restricted Subsidiaries or
(B) invest an equal amount, or the amount not so applied pursuant
to clause (A), (or enter into a definitive agreement committing to so
invest within 12 months after the date of such agreement) in property
or assets (other than current assets) of a nature or type or that are
used in a business (or in a company having property and assets of a
nature or type, or engaged in a business) similar or related to the
nature or type of the property and assets of, or the business of, the
Company and its Restricted Subsidiaries existing on the date of such
investment (as
63
determined in good faith by the Board of Directors, whose
determination shall be conclusive and evidenced by a Board Resolution)
and
(ii) apply (no later than the end of the 12-month period referred
to in clause (i)) such excess Net Cash Proceeds (to the extent not
applied or committed to be applied pursuant to clause (i)) as provided
in the following paragraph of this Section 4.11.
The amount of such excess Net Cash Proceeds required to be applied (or to be
committed to be applied) during such 12-month period as set forth in clause (i)
of the preceding sentence and not applied or committed to be applied as so
required by the end of such period shall constitute "Excess Proceeds."
If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 4.11 totals at least $5 million, the Company must commence, not later
than the fifteenth Business Day of such month, and consummate an Offer to
Purchase from the Holders of the Notes (and if and to the extent required by the
terms of any Indebtedness that is PARI PASSU with the Notes or any Notes
Guarantee ("Pari Passu Indebtedness"), purchase, redeem or repay such Pari Passu
Indebtedness) on a PRO RATA basis an aggregate principal amount of Notes (and an
amount of Pari Passu Indebtedness) equal to the Excess Proceeds on such date, at
a purchase price equal to 100% of the principal amount of the Notes (and the
required amount of Pari Passu Indebtedness), plus accrued interest (if any) to
the Payment Date. If the aggregate principal amount of the Notes and aggregate
principal amount of such Pari Passu Indebtedness validly tendered and not
withdrawn (or otherwise subject to purchase, redemption or repayment) exceeds
such Excess Proceeds, such Excess Proceeds will be apportioned between the Notes
and such Pari Passu Indebtedness, with the portion of such Excess Proceeds
payable in respect of the Notes to equal the lesser of (x) the Excess Proceeds
amount multiplied by a fraction, the numerator of which is the aggregate
principal amount of the Notes and the denominator of which is the sum of the
aggregate principal amount of the Notes and the aggregate principal amount of
such Pari Passu Indebtedness and (y) the aggregate principal amount of Notes
validly tendered and not withdrawn.
Any Excess Proceeds remaining after such Offer to Purchase is completed may
be applied to fund any general corporate purpose not prohibited by the
Indenture.
For purposes of the first paragraph of this Section 4.11, (1) securities
received by the Company or any Restricted Subsidiary in any Asset Sale that are
converted by the Company or such Restricted Subsidiary into cash within 12
months after such Asset Sale and (2) consideration consisting of Indebtedness of
the Company or any Restricted Subsidiary, shall be deemed to be cash.
SECTION 4.12. REPURCHASE OF NOTES UPON A CHANGE OF CONTROL. The Company
shall commence, within 30 days of the occurrence of a Change of Control, and
consummate an Offer
64
to Purchase for all Notes then outstanding, at a purchase price equal to 101% of
the principal amount thereof, plus accrued and unpaid interest, if any, to the
Payment Date.
SECTION 4.13. EXISTENCE. Subject to Articles Four and Five of this
Indenture, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each Restricted Subsidiary and the
rights (whether pursuant to charter, partnership certificate, agreement, statute
or otherwise), licenses and franchises of the Company and each Restricted
Subsidiary; PROVIDED that the Company shall not be required to preserve any such
right, license or franchise, or the existence of any Restricted Subsidiary, if
the maintenance or preservation thereof is, in the judgment of the Company, no
longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries taken as a whole.
SECTION 4.14. PAYMENT OF TAXES AND OTHER CLAIMS. The Company will pay or
discharge and shall cause each of its Restricted Subsidiaries to pay or
discharge, or cause to be paid or discharged, before the same shall become
delinquent (i) all material taxes, assessments and governmental charges levied
or imposed upon (a) the Company or any such Restricted Subsidiary, (b) the
income or profits of any such Restricted Subsidiary which is a corporation or
(c) the property of the Company or any such Restricted Subsidiary and (ii) all
material lawful claims for labor, materials and supplies that, if unpaid, might
by law become a lien upon the property of the Company or any such Restricted
Subsidiary; PROVIDED that the Company shall not be required to pay or discharge,
or cause to be paid or discharged, any such tax, assessment, charge or claim (x)
the amount, applicability or validity of which is being contested in good faith
by appropriate proceedings and for which adequate reserves have been established
to the extent required by generally accepted accounting principles or (y) if
failure to do so would not (as determined by the Company in good faith)
reasonably be expected to have a material adverse effect on the financial
condition, results of operations or business of the Company and its Restricted
Subsidiaries taken as a whole or (z) if any resulting Lien constitutes a
Permitted Lien or otherwise complies with Section 4.09.
SECTION 4.15. MAINTENANCE OF PROPERTIES AND INSURANCE. The Company will
cause all properties used or useful in the conduct of its business or the
business of any of its Restricted Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Company may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; PROVIDED that nothing in
this Section 4.15 shall prevent the Company or any Restricted Subsidiary from
omitting to take such action or discontinuing the use, operation or maintenance
of any of such properties or disposing of any of them, if such omission,
65
discontinuance or disposal is, in the judgment of the Company, desirable in the
conduct of the business of the Company or such Restricted Subsidiary.
The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly situated and owning like properties, including, but not limited to,
products liability insurance and public liability insurance, with reputable
insurers, in such amounts, with such deductibles and by such methods as shall be
customary for corporations similarly situated in the industry in which the
Company or any such Restricted Subsidiary, as the case may be, is then
conducting business; PROVIDED that in the judgment of the Company such insurance
is available to the Company on commercially reasonable terms and is desirable.
SECTION 4.16. NOTICE OF DEFAULTS. In the event that any Officer becomes
aware of any Default or Event of Default, the Company shall promptly deliver to
the Trustee an Officers' Certificate specifying such Default or Event of
Default.
SECTION 4.17. COMPLIANCE CERTIFICATES. The Company shall deliver to the
Trustee, within 90 days after the end of each fiscal year, an Officers'
Certificate stating whether or not the signers know of any Default or Event of
Default that occurred during such fiscal quarter. Such certificate shall contain
a certification from the principal executive officer, principal financial
officer or principal accounting officer of the Company that a review has been
conducted of the activities of the Company and its Restricted Subsidiaries and
the Company's and its Restricted Subsidiaries' performance under this Indenture
and that the Company has complied with all conditions and covenants under this
Indenture. For purposes of this Section 4.17, such compliance shall be
determined without regard to any period of grace or requirement of notice
provided under this Indenture. If any of the officers of the Company signing
such certificate has knowledge of such a Default or Event of Default, the
certificate shall describe any such Default or Event of Default and its status.
SECTION 4.18. COMMISSION REPORTS AND REPORTS TO HOLDERS. At all times from
and after the earlier of (i) the date of the commencement of an Exchange Offer
or the effectiveness of a Shelf Registration Statement (the "Registration") and
(ii) the date that is six months after the Closing Date, in either case, whether
or not the Company is then required to file reports with the Commission, the
Company shall file with the Commission to the extent then permitted by the
Securities Exchange Act of 1934, as amended, and by the Commission, all such
information on an appropriate available form as it would be required to file
with the Commission by Sections 13(a) or 15(d) under the Securities Exchange Act
of 1934 as if it were a U.S. company and subject thereto, including information
required by annual, quarterly and current reports, whether or not required to be
so filed. The Company shall supply the Trustee and each Holder or shall supply
to the Trustee for forwarding to all Holders, without cost to such Holders,
copies of such reports and other information. In addition, at all times prior to
the earlier of the date of the Registration and the date that is six months
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after the Closing Date, the Company shall, at its cost, supply the Trustee and
each Holder or shall supply to the Trustee for forwarding to all Holders,
without cost to such Holders, quarterly and annual reports substantially
equivalent to those described above or which would otherwise be required by the
Exchange Act commencing with the report for the fiscal quarter ending
immediately after the Closing Date; provided that the Company may deliver copies
of the registration statement (including pre-effective amendments thereto) with
respect to the Exchange Offer to the extent it contains the information that
would have been required in such reports. In addition, at all times prior to the
Registration, upon the request of any Holder or any prospective purchaser of the
Notes designated by a Holder, the Company shall supply to such Holder or such
prospective purchaser the information required under Rule 144A under the
Securities Act. The Company also shall comply with the other provisions of TIA
Section 314(a).
SECTION 4.19. WAIVER OF STAY, EXTENSION OR USURY LAWS. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of, premium, if any, or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or that may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
SECTION 4.20. ADDITIONAL AMOUNTS. All payments made by the Company under or
with respect to the Notes shall be made free and clear of and without
withholding or deduction for or on account of any present or future tax, duty,
levy, impost, assessment, or other governmental charge (including penalties,
interest and other liabilities related thereto) (collectively, "TAXES") imposed
or levied by or on behalf of Luxembourg or any other jurisdiction in which the
Company is organized or is a resident for tax purposes or by any government
authority or political subdivision or territory or possession or agency therein
or thereof having the power to tax (each, a "TAXING AUTHORITY"), unless the
Company is required to withhold or deduct Taxes by law or by the interpretation
or administration thereof.
If the Company is required to withhold or deduct any amount for or on
account of Taxes imposed by a Taxing Authority within Luxembourg or within any
other jurisdiction in which the Company is organized or is a resident for tax
purposes, from any payment made under or with respect to the Notes, the Company
shall pay such additional amounts ("ADDITIONAL AMOUNTS") as may be necessary so
that the net amount received by each Holder of Notes after such withholding or
deduction will not be less than the amount the Holder and beneficial owner would
have received if such Taxes had not been withheld or deducted; PROVIDED that no
Additional Amounts shall be payable with respect to a payment made to a Holder
of Notes or to a third party on behalf of a
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Holder, with respect to (a) any Taxes that would not have been so imposed but
for the existence of any present or former connection between such Holder and
the jurisdiction imposing such tax (other than the mere receipt of such payment
or the ownership or holding outside of Luxembourg of such Note); (b) any estate,
inheritance, gift, sales, excise, transfer, personal property tax or similar
tax, assessment or governmental charge; (c) any Taxes payable otherwise than by
deduction or withholding from payments of principal of, premium, if any, or
interest on such Note; or (d) Taxes that would not have been imposed but for the
failure of the Holder or beneficial owner of a Note to comply, upon written
request therefor furnished by the Company to the Trustee, with any
certification, identification, information, or other documentation requirement
under law, regulation, administrative practice or an applicable treaty that is a
precondition to exemption from, or reduction in the rate of the imposition,
deduction or withholding of Taxes; nor shall Additional Amounts be paid: (i) if
the payment under or with respect to the Notes could have been made by another
paying agent without such deduction or withholding, (ii) if the payment under or
with respect to the Notes could have been made without such deduction or
withholding if the beneficiary of the payment had presented the Note for payment
within 30 days after (A) the date on which such payment or such Note became due
and payable or (B) the date on which payment thereof is duly provided for,
whichever is later (except to the extent that the holder would have been
entitled to Additional Amounts had the Note been presented on the last day of
such 30 day period), (iii) with respect to any payment under or with respect to
the Notes to any holder who is a fiduciary or partnership or any person other
than the sole beneficial owner of such payment, to the extent that a beneficiary
or settlor with respect to such fiduciary, a member of such a partnership or the
beneficial owner of such payment would not have been entitled to the Additional
Amounts had such beneficiary, settlor, member or beneficial owner been the
actual holder of such Note.
The Company shall also (i) make such withholding or deduction and (ii)
remit the full amount deducted or withheld to the relevant authority in
accordance with applicable law. The Company shall use its reasonable efforts to
obtain certified copies of tax receipts evidencing the payment of any Taxes so
deducted or withheld from each Taxing Authority imposing such Taxes. The Company
will supply to the Trustee for forwarding to all Holders, without cost to such
Holders, within 60 days after the date the payment of any Taxes so deducted or
withheld is due pursuant to applicable law, certified copies of tax receipts
evidencing such payment by the Company or if, notwithstanding the Company's
efforts to obtain such receipts, the same are not obtainable, other evidence of
such payments by the Company.
At least 30 days prior to each date on which any payment under or with
respect to the Notes is due and payable, if the Company shall be obligated to
pay Additional Amounts with respect to such payment, the Company shall deliver
to the Trustee an Officers' Certificate stating the fact that such Additional
Amounts will be payable, the amounts so payable and shall set forth such other
information as is necessary to enable the Trustee to pay such Additional Amounts
to holders of Notes on the payment date.
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The foregoing provisions shall survive any termination or the discharge of
this Indenture and shall apply MUTATIS MUTANDIS to any jurisdiction in which any
successor Person to the Company is organized or is engaged in business for tax
purposes or any political subdivision or taxing authority or agency thereof or
therein.
In addition, the Company shall pay any stamp, issue, registration,
documentary or other similar taxes and duties, including interest and penalties,
payable in Luxembourg or any political subdivision thereof or therein in respect
of the creation, issue and offering of the Notes.
Whenever in this Indenture or the Notes there is mentioned in any context,
the payment of amounts based upon principal of, premium, if any, or interest or
of any other amount payable under or with respect to any of the Notes, such
mention shall be deemed to include mention of the payment of Additional Amounts
to the extent that, in such context, Additional Amounts are, were or would be
payable in respect thereof.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. WHEN COMPANY MAY MERGE, ETC. The Company shall not
consolidate with, merge with or into, or sell, convey, transfer, lease or
otherwise dispose of all or substantially all of its property and assets (as an
entirety or substantially an entirety in one transaction or a series of related
transactions) to, any Person or permit any Person to merge with or into the
Company unless:
(i) the Company shall be the continuing Person, or the Person (if
other than the Company) formed by such consolidation or into which the
Company is merged or that acquired or leased such property and assets of
the Company shall be a corporation organized and validly existing under the
laws of the Kingdom of the Netherlands (including the Netherlands
Antilles), Bermuda, Canada, Switzerland, any member state of the European
Union or the United States of America or any jurisdiction thereof and shall
expressly assume, by a supplemental indenture, executed and delivered to
the Trustee, all of the obligations of the Company on the Notes and under
this Indenture;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing;
(iii) immediately after giving effect to such transaction on a pro
forma basis, the Company or any Person becoming the successor obligor of
the Notes shall have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the
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Company immediately prior to such transaction; PROVIDED that this clause
(iii) shall only apply to a sale of less than all of the assets of the
Company;
(iv) immediately after giving effect to such transaction on a pro
forma basis the Company, or any Person becoming the successor obligor on
such Notes, as the case may be, could Incur at least $1.00 of Indebtedness
under the first paragraph of Section 4.03; PROVIDED that this clause (iv)
shall not apply to a consolidation, merger or sale of all (but not less
than all) of the assets of the Company if all Liens and Indebtedness of the
Company or any Person becoming the successor obligor of the Notes, as the
case may be, and its Restricted Subsidiaries outstanding immediately after
such transaction would, if Incurred at such time, have been permitted to be
Incurred (and all such Liens and Indebtedness, other than Liens and
Indebtedness of the Company and its Restricted Subsidiaries outstanding
immediately prior to the transaction, shall be deemed to have been
Incurred) for all purposes of this Indenture; and
(v) the Company delivers to the Trustee an Officers' Certificate
(attaching the arithmetic computations to demonstrate compliance with
clauses (iii) and (iv) above) and Opinion of Counsel, in each case to the
effect that such consolidation, merger or transfer and such supplemental
indenture complies with this provision and that all conditions precedent
provided for in this paragraph relating to such transaction have been
complied with;
PROVIDED, HOWEVER, that (x) in giving any such opinion such counsel may rely on
an Officers' Certificate as to compliance with the foregoing clauses (ii), (iii)
and (iv) and as to any matters of fact and (y) clauses (iii) and (iv) above will
not apply if, in the good faith determination of the Board of Directors of the
Company, whose determination shall be evidenced by a Board Resolution, the
principal purpose of such transaction is to change the jurisdiction of
organization of the Company, and such transaction does not have as one of its
purposes the evasion of the foregoing limitations.
SECTION 5.02. SUCCESSOR SUBSTITUTED. Upon any consolidation or merger, or
any sale, conveyance, transfer, lease or other disposition of all or
substantially all of the property and assets of the Company in accordance with
Section 5.01 of this Indenture, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale,
conveyance, transfer, lease or other disposition is made shall succeed to, and
be substituted for, 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 that the Company shall not be released from its
obligation to pay the principal of, premium, if any, or interest on the Notes in
the case of a lease of all or substantially all of its property and assets.
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ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT. Any of the following events shall
constitute an "EVENT OF DEFAULT" hereunder:
(a) default in the payment of principal of (or premium, if any, on)
any Note when the same becomes due and payable at maturity, upon
acceleration, redemption or otherwise;
(b) default in the payment of interest on any Note when the same
becomes due and payable, and such default continues for a period of 30
days; PROVIDED that a failure to make any of the first five scheduled
interest payments on the Notes on the applicable Interest Payment Date will
constitute an Event of Default with no grace or cure period;
(c) default in the performance or breach of the provisions of Article
Five of this Indenture or the failure to make or consummate an Offer to
Purchase when required in accordance with Section 4.11 or 4.12 of this
Indenture;
(d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in this Indenture or under the Notes
(other than a default specified in clause (a), (b) or (c) above) or the
Pledge Agreement and such default or breach continues for a period of 30
consecutive days after written notice by the Trustee or the Holders of 25%
or more in aggregate principal amount of the Notes;
(e) there occurs with respect to any issue or issues of Indebtedness
of the Company or any Significant Subsidiary having an outstanding
principal amount of $10 million or more in the aggregate for all such
issues of all such Persons, whether such Indebtedness now exists or shall
hereafter be created, (I) an event of default that has caused the holder
thereof to declare such Indebtedness to be due and payable prior to its
Stated Maturity and such Indebtedness has not been discharged in full or
such acceleration has not been rescinded or annulled within 30 days of such
acceleration and/or (II) the failure to make a principal payment at the
final (but not any interim) fixed maturity and such defaulted payment shall
not have been made, waived or extended within 30 days of such payment
default;
(f) any final judgment or order (not covered by insurance) for the
payment of money in excess of $10 million in the aggregate for all such
final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any Significant Subsidiary and shall not be
paid or discharged, and there shall be any period of 60 consecutive days
following
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entry of the final judgment or order that causes the aggregate amount for
all such final judgments or orders outstanding and not paid or discharged
against all such Persons to exceed $10 million during which a stay of
enforcement of such final judgment or order, by reason of a pending appeal
or otherwise, shall not be in effect;
(g) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Company or any Significant
Subsidiary in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, (B) appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Company or any Significant Subsidiary or for all or
substantially all of the property and assets of the Company or any
Significant Subsidiary or (C) the winding up or liquidation of the affairs
of the Company or any Significant Subsidiary and, in each case, such decree
or order shall remain unstayed and in effect for a period of 30 consecutive
days;
(h) the Company or any Significant Subsidiary (A) commences a
voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (C) effects any
general assignment for the benefit of creditors; or
(i) the Pledge Agreement shall cease to be in full force and effect or
enforceable in accordance with its terms, other than in accordance with its
terms.
SECTION 6.02. ACCELERATION. If an Event of Default (other than an Event of
Default specified in clause (g) or (h) of Section 6.01 that occurs with respect
to the Company) occurs and is continuing under this Indenture, the Trustee or
the Holders of at least 25% in aggregate principal amount of the Notes then
outstanding, by written notice to the Company (and to the Trustee if such notice
is given by the Holders), may, and the Trustee at the request of such Holders
shall, declare the principal of, premium, if any, and accrued interest on the
Notes to be immediately due and payable. Upon a declaration of acceleration,
such principal of, premium, if any, and accrued and unpaid interest shall be
immediately due and payable. In the event of a declaration of acceleration
because an Event of Default set forth in clause (e) of Section 6.01 has occurred
and is continuing, such declaration of acceleration shall be automatically
rescinded and annulled if the event of default triggering such Event of Default
pursuant to clause (e) shall be remedied or cured by the Company or the relevant
Significant Subsidiary or waived by the holders of the relevant Indebtedness
within 60 days after the declaration of acceleration with respect thereto. If an
Event of Default specified in clause (g) or (h) of Section 6.01 occurs with
respect
72
to the Company, the principal of, premium, if any, and accrued and unpaid
interest on the Notes then outstanding shall IPSO FACTO become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
At any time after such declaration of acceleration, but before a judgment
or decree for the payment of the money due has been obtained by the Trustee, the
Holders of at least a majority in principal amount of the outstanding Notes by
written notice to the Company and to the Trustee, may waive all past Defaults
and rescind and annul a declaration of acceleration and its consequences if (a)
the Company has paid or deposited with the Trustee a sum sufficient to pay (i)
all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances (if any) of the Trustee, its
agents and counsel, (ii) all overdue interest on all Notes, (iii) the principal
of and premium, if any, on any Notes that have become due otherwise than by such
declaration or occurrence of acceleration and interest thereon at the rate
prescribed therefor by such Notes, and (iv) to the extent that payment of such
interest is lawful, interest upon overdue interest, if any, at the rate
prescribed therefor by such Notes, (b) all existing Events of Default, other
than the non-payment of the principal of, premium, if any, and accrued interest
on the Notes that have become due solely by such declaration of acceleration,
have been cured or waived and (c) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction.
SECTION 6.03. OTHER REMEDIES. If an Event of Default occurs and is
continuing, the Trustee may, and, subject to Section 7.02(iv), at the direction
of the Holders of at least a majority in principal amount of the outstanding
Notes shall, pursue any available remedy by proceeding at law or in equity to
collect the payment of principal of, premium, if any, or 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.
SECTION 6.04. WAIVER OF PAST DEFAULTS. Subject to Sections 6.02, 6.07 and
9.02, the Holders of at least a majority in principal amount of the outstanding
Notes, by notice to the Trustee, may waive an existing Default or Event of
Default and its consequences, except a Default in the payment of principal of,
premium, if any, or interest on any Note as specified in clause (a) or (b) of
Section 6.01 or in respect of a covenant or provision of this Indenture which
cannot be modified or amended without the consent of the Holder of each
outstanding Note affected. 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 Event of Default or impair any right
consequent thereto.
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SECTION 6.05. CONTROL BY MAJORITY. The Holders of at least a majority in
aggregate principal amount of the outstanding Notes may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on the Trustee; provided that the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that may involve the Trustee in personal liability, or that the
Trustee determines in good faith may be unduly prejudicial to the rights of
Holders of Notes not joining in the giving of such direction; and provided
further that the Trustee may take any other action it deems proper that is not
inconsistent with any such direction received from Holders of Notes.
SECTION 6.06. LIMITATION ON SUITS. A Holder may not institute any
proceeding, judicial or otherwise, with respect to this Indenture or the Notes,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(i) the Holder has previously given the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount of
outstanding Notes shall have made a written request to the Trustee to
pursue such remedy;
(iii) such Holder or Holders offer the Trustee indemnity reasonably
satisfactory to the Trustee against any costs, liability or expense;
(iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of a majority in aggregate
principal amount of the outstanding Notes do not give the Trustee a
direction that is inconsistent with the request.
For purposes of Section 6.05 of this Indenture and this Section 6.06, the
Trustee shall comply with TIA Section 316(a) in making any determination of
whether the Holders of the required aggregate principal amount of outstanding
Notes have concurred in any request or direction of the Trustee to pursue any
remedy available to the Trustee or the Holders with respect to this Indenture or
the Notes or otherwise under the law.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. Notwithstanding any
other provision of this Indenture, the right of any Holder of a Note to receive
payment of the principal of, premium, if any, or interest on, such Note or to
bring suit for the enforcement of any such
74
payment, on or after the due date expressed in the Notes, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default in payment
of principal, premium or interest specified in clause (a), (b) or (c) of Section
6.01 occurs and is continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company or any other obligor of
the Notes for the whole amount of principal, premium, if any, and accrued
interest remaining unpaid, together with interest on overdue principal, premium,
if any, and, to the extent that payment of such interest is lawful, interest on
overdue installments of interest, in each case at the rate specified in the
Notes, and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances (if any) of the Trustee, its agents and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under Section
7.07) and the Holders allowed in any judicial proceedings relative to the
Company (or any other obligor of the Notes), its creditors or its property and
shall be entitled and empowered to collect and receive any monies, securities or
other property payable or deliverable upon conversion or exchange of the Notes
or upon any such claims and to distribute the same, and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official 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. Nothing herein contained shall be deemed to empower
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 thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES. If the Trustee collects any money pursuant to
this Article Six, it shall pay out the money in the following order:
First: to the Trustee for all amounts due under Section 7.07;
Second: to Holders for amounts then due and unpaid for principal of,
premium, if any, and interest on the Notes in respect of which or for the
benefit of which such money has been collected, ratably, without preference
or priority of any kind, according
75
to the amounts due and payable on such Notes for principal, premium, if
any, and interest, respectively; and
Third: to the Company or any other obligors of the Notes, as their
interests may appear, or as a court of competent jurisdiction may direct.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS. In any suit for the enforcement of any
right or remedy under this Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court may require any party litigant
in such suit to file an undertaking to pay the costs of the suit, and the court
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, a suit by a Holder pursuant to Section 6.07, or a suit
by Holders of more than 10% in principal amount of the outstanding Notes.
SECTION 6.12. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then, and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Company, Trustee and the Holders shall continue as though no such proceeding had
been instituted.
SECTION 6.13. RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
wrongfully taken Notes in Section 2.09, no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 6.14. DELAY OR OMISSION NOT WAIVER. No delay or omission of the
Trustee or of any Holder to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article Six or by law to the Trustee or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or by
the Holders, as the case may be.
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ARTICLE SEVEN
TRUSTEE
SECTION 7.01. GENERAL. The duties and responsibilities of the Trustee shall
be as provided by the TIA and as set forth herein. All rights (including the
right to indemnification) stated in this Article Seven shall also be conferred
on any Registrar or Paying Agent. Notwithstanding the foregoing, no provision of
this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not herein expressly so provided, every provision of this Indenture
relating to the conduct or affecting the liability of or affording protection to
the Trustee shall be subject to the provisions of this Article Seven.
SECTION 7.02. CERTAIN RIGHTS OF TRUSTEE. Subject to TIA Sections 315(a)
through (d):
(i) the Trustee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper person;
(ii) before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel, which shall
conform to Section 11.04. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such certificate or
opinion;
(iii) the Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any attorney
or agent appointed with due care by it hereunder;
(iv) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses
and liabilities that might be incurred by it in compliance with such
request or direction;
(v) the Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within its
rights or powers, provided that the Trustee's conduct does not constitute
negligence or bad faith;
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(vi) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate;
(vii) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document; and
(viii) the Trustee shall not be charged with knowledge of any
documentation other than this Indenture or documentation to which it is a
party.
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 its Affiliates with the same rights it would
have if it were not the Trustee. Any Agent may do the same with like rights.
However, the Trustee is subject to TIA Sections 310(b) and 311.
SECTION 7.04. TRUSTEE'S DISCLAIMER. The Trustee (i) makes no representation
as to the validity or adequacy of this Indenture, the Pledge Agreement or the
Notes, (ii) shall not be accountable for the Company's use or application of the
proceeds from the Notes and (iii) shall not be responsible for any statement in
the Notes other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULT. If any Default or any Event of Default
occurs and is continuing and if such Default or Event of Default is known to the
Trustee, the Trustee shall mail to each Holder in the manner and to the extent
provided in TIA Section 313(c) notice of the Default or Event of Default within
45 days after it occurs, unless such Default or Event of Default has been cured;
PROVIDED, HOWEVER, that, except in the case of a default in the payment of the
principal of, premium, if any, or interest on any Note, the Trustee shall be
protected in withholding such notice if and so long as a trust committee of
Responsible Officers of the Trustee in good faith determine that the withholding
of such notice is in the interest of the Holders.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS. Within 60 days after each May
15, beginning with May 15, 1999, the Trustee shall mail to each Holder as
provided in TIA Section 313(c) a brief report dated as of such May 15, if
required by TIA Section 313(a).
A copy of each report at the time of its mailing to the Holders of
Securities shall be mailed to the Company and filed by the Company with the
Commission and each stock exchange on which the Securities are listed in
accordance with TIA Section 313(d). The Company shall
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promptly notify the Trustee when the Securities are listed on any stock exchange
or of any delisting thereof.
SECTION 7.07. COMPENSATION AND INDEMNITY. The Company shall pay to the
Trustee such compensation as shall be agreed upon in writing for its services
hereunder. The compensation of the Trustee shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances (if
any) incurred or made by the Trustee without negligence or bad faith on its
part. Such expenses shall include the reasonable compensation and expenses of
the Trustee's agents and counsel.
The Company shall indemnify the Trustee (which for purposes of this Section
7.07 shall include its directors, officers, employees and agents) for, and hold
it harmless against, any loss or liability or expense incurred by it without
negligence or bad faith on its part in connection with the acceptance or
administration of this Indenture and its duties under this Indenture and the
Notes, including the costs and expenses of defending itself against any claim or
liability and of complying with any process served upon it or any of its
officers in connection with the exercise or performance of any of its powers or
duties under this Indenture and the Notes. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Company shall not relieve the Company of its obligations
hereunder, unless the Company is materially prejudiced thereby. At the Trustee's
request, the Company shall defend the claim and the Trustee shall cooperate in
the defense. Unless otherwise set forth herein, the Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent,
which consent shall not be unreasonably withheld.
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, in its capacity as Trustee, except money or property
held in trust, pursuant to the Pledge Agreement or otherwise, to pay principal
of, premium, if any, and interest on particular Notes.
If the Trustee incurs expenses or renders services after the occurrence of
an Event of Default specified in clause (g) or (h) of Section 6.01, the expenses
and the compensation for the services will be intended to constitute expenses of
administration under Title 11 of the United States Bankruptcy Code or any
applicable federal or state law for the relief of debtors.
The provisions of this Section 7.07 shall survive the termination of this
Indenture, the payment of the Notes and the resignation or removal of the
Trustee.
The Trustee shall comply with the provisions of TIA Section 313(b)(2) to
the extent applicable.
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SECTION 7.08. REPLACEMENT OF TRUSTEE. 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.
The Trustee may resign at any time by so notifying the Company in writing
at least 30 days prior to the date of the proposed resignation. The Holders of a
majority in principal amount of the outstanding Notes may remove the Trustee by
so notifying the Trustee in writing and may appoint a successor Trustee with the
consent of the Company. The Company may remove the Trustee if: (i) the Trustee
is no longer eligible under Section 7.10; (ii) the Trustee is adjudged a
bankrupt or an insolvent; (iii) a receiver or other public officer takes charge
of the Trustee or its property; or (iv) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed, or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company. If
the successor Trustee does not deliver its written acceptance required by the
next succeeding paragraph of this Section 7.08 within 30 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of a majority in principal amount of the outstanding Notes may, at the expense
of the Company, petition any court of competent jurisdiction for the appointment
of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Immediately after the delivery of
such written acceptance, subject to the lien provided in Section 7.07, (i) the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, (ii) the resignation or removal of the retiring Trustee shall
become effective and (iii) the successor Trustee shall have all the rights,
powers and duties of the Trustee under this Indenture. A successor Trustee shall
mail notice of its succession to each Holder. No successor Trustee shall accept
its appointment unless at the time of such acceptance such successor Trustee
shall be qualified and eligible under this Article.
If the Trustee is no longer eligible under Section 7.10 or shall fail to
comply with TIA Section 310(b), any Holder who satisfies the requirements of TIA
Section 310(b) may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee. If at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 7.08, the Trustee shall resign immediately in the manner and with the
effect provided in this Section.
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The Company shall give notice of any resignation and any removal of the
Trustee and each appointment of a successor Trustee to all Holders. Each notice
shall include the name of the successor Trustee and the address of its Corporate
Trust Office.
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligation under Section 7.07 shall continue for the benefit of
the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all of its
corporate trust business to, another corporation or national banking
association, the resulting, surviving or transferee corporation or national
banking association without any further act shall be the successor Trustee with
the same effect as if the successor Trustee had been named as the Trustee
herein, provided such corporation shall be otherwise qualified and eligible
under this Article.
SECTION 7.10. ELIGIBILITY. This Indenture shall always have a Trustee who
satisfies the requirements of TIA Section 310(a)(1). The Trustee shall have a
combined capital and surplus of at least $25 million as set forth in its most
recent published annual report of condition that is subject to the requirements
of applicable Federal or state supervising or examining authority. If at any
time the Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in this Article.
SECTION 7.11. MONEY HELD IN TRUST. The Trustee shall not be liable for
interest on any money received by it except as the Trustee may agree with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law and except for money held in trust
under Article Eight of this Indenture.
ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. TERMINATION OF COMPANY'S OBLIGATIONS. Except as otherwise
provided in this Section 8.01, the Company may terminate its obligations under
the Notes and this Indenture if:
(i) all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes that have been replaced or Notes that are
paid pursuant to Section 4.01 or Notes for whose payment money or
securities have theretofore been held in trust and thereafter repaid to the
Company, as provided in Section 8.05) have been delivered to the Trustee
for cancellation and the Company has paid all sums payable by it hereunder;
or
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(ii) (A) the Notes mature within one year or all of them are to be
called for redemption within one year under arrangements satisfactory to
the Trustee for giving the notice of redemption, (B) the Company
irrevocably deposits in trust with the Trustee during such one-year period,
as trust funds solely for the benefit of the Holders for that purpose,
money or U.S. Government Obligations sufficient (in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee), without
consideration of any reinvestment of any interest thereon, to pay
principal, premium, if, any, and interest on the Notes to maturity or
redemption, as the case may be, (C) no Default or Event of Default with
respect to the Notes shall have occurred and be continuing on the date of
such deposit, (D) such deposit will not result in a breach or violation of,
or constitute a default under, this Indenture or any other material
agreement or instrument to which the Company is a party or by which it is
bound and (E) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the satisfaction and
discharge of this Indenture have been complied with.
With respect to the foregoing clause (i), the Company's obligations under
Section 7.07 shall survive. With respect to the foregoing clause (ii), the
Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 4.20, 7.07, 7.08 and 8.06, and the rights, powers,
trusts, duties and immunities of the Trustee hereunder, shall survive until the
Notes are no longer outstanding. Thereafter, only the Company's obligations in
Sections 7.07 and 8.06, and the Trustee's obligations under Sections 8.04 and
8.05, shall survive. After any such irrevocable deposit, the Trustee upon
request shall acknowledge in writing the discharge of the Company's obligations
under the Notes and this Indenture except for those surviving obligations
specified above.
SECTION 8.02. DEFEASANCE AND DISCHARGE OF INDENTURE. The Company will be
deemed to have paid and will be discharged from any and all obligations in
respect of the Notes on the 123rd day after the date of the deposit referred to
in clause (A) of this Section 8.02, and the provisions of this Indenture will no
longer be in effect with respect to the Notes, and the Trustee, at the expense
of the Company, shall execute proper instruments acknowledging the same if:
(A) with reference to this Section 8.02, the Company has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee (or another trustee satisfying the requirements of Section 7.10)
and conveyed all right, title and interest to the Trustee for the benefit
of the Holders, under the terms of an irrevocable trust agreement in form
and substance reasonably satisfactory to the Trustee as trust funds in
trust, specifically pledged to the Trustee for the benefit of the Holders
as security for payment of the principal of, premium, if any, and interest,
if any, on the Notes, and dedicated solely to, the benefit of the Holders,
in and to (1) money in an amount, (2) U.S. Government Obligations that,
through the payment of interest, premium, if any, and principal in respect
thereof in
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accordance with their terms, will provide money in an amount or (3) a
combination thereof in an amount sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge,
without consideration of the reinvestment of such interest and after
payment of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee, the principal of,
premium, if any, and interest on the outstanding Notes on the Stated
Maturity of such principal or interest or on any earlier Redemption Date;
PROVIDED that the Trustee shall have been irrevocably instructed to apply
such money or the proceeds of such U.S. Government Obligations to the
payment of such principal, premium, if any, and interest with respect to
the Notes and, with respect to any Redemption Date, the Company shall have
provided the Trustee with irrevocable instructions to redeem all of the
Notes on such Redemption Date;
(B) the Company has delivered to the Trustee (1) either (x) an
Opinion of Counsel to the effect that Holders will not recognize income,
gain or loss for federal income tax purposes as a result of the Company's
exercise of its option under this Section 8.02 and will be subject to
federal income tax on the same amount and in the same manner and at the
same times as would have been the case if such option had not been
exercised, which Opinion of Counsel shall be based upon (and accompanied by
a copy of) a ruling of the Internal Revenue Service to the same effect
unless there has been a change in applicable federal income tax law after
the Closing Date such that a ruling is no longer required or (y) a ruling
directed to the Trustee received from the Internal Revenue Service to the
same effect as the aforementioned Opinion of Counsel and (2) an Opinion of
Counsel to the effect that the creation of the defeasance trust does not
violate the Investment Company Act of 1940 and that after the passage of
123 days following the deposit (except, with respect to any trust funds for
the account of any Holder who may be deemed to be an "insider" for purposes
of the United States Bankruptcy Code, after one year following the
deposit), the trust funds will not be subject to the effect of Xxxxxxx 000
xx xxx Xxxxxx Xxxxxx Bankruptcy Code or Section 15 of the New York Debtor
and Creditor Law in a case commenced by or against the Company under either
such statute, and either (I) the trust funds will no longer remain the
property of the Company (and therefore will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally) or (II) if a court were to rule
under any such law in any case or proceeding that the trust funds remained
property of the Company, (a) assuming such trust funds remained in the
possession of the Trustee prior to such court ruling to the extent not paid
to the Holders, the Trustee will hold, for the benefit of the Holders, a
valid and perfected security interest in such trust funds that is not
avoidable in bankruptcy or otherwise except for the effect of Section
552(b) of the United States Bankruptcy Code on interest on the trust funds
accruing after the commencement of a case under such statute and (b) the
Holders will be entitled to receive adequate protection of their interests
in such trust funds if such trust funds are used in such case or
proceeding;
83
(C) immediately after giving effect to such deposit, on a pro forma
basis, no Default or Event of Default shall have occurred and be continuing
on the date of such deposit or during the period ending on the 123rd day
after such date of such deposit, and such deposit shall not result in a
breach or violation of, or constitute a default under, any other material
agreement or instrument to which the Company or any of its Subsidiaries is
a party or by which the Company or any of its Subsidiaries is bound;
(D) if the Notes are then listed on a national securities exchange,
the Company has delivered to the Trustee an Opinion of Counsel to the
effect that the Notes will not be delisted as a result of such deposit,
defeasance and discharge; and
(E) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the defeasance
contemplated by this Section 8.02 have been complied with (which Opinion of
Counsel may rely on any Officers certificate as to matters of fact,
including, to the extent applicable, compliance with the foregoing clauses
(A),(B), (C) and (D)).
Notwithstanding the foregoing, prior to the end of the 123-day (or one
year) period referred to in clause (B)(2) of this Section 8.02, none of the
Company's obligations under this Indenture shall be discharged. Subsequent to
the end of such 123-day (or one year) period with respect to this Section 8.02,
the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 4.20, 8.06, and the rights, powers, trusts, duties and
immunities of the Trustee hereunder shall survive until the Notes are no longer
outstanding. Thereafter, only the Company's obligations in Sections 7.07 and
8.06, and the Trustee's obligations under Sections 8.04 and 8.05, shall survive.
If and when a ruling from the Internal Revenue Service or an Opinion of Counsel
referred to in clause (B)(1) of this Section 8.02 is able to be provided
specifically without regard to, and not in reliance upon, the continuance of the
Company's obligations under Section 4.01, then the Company's obligations under
such Section 4.01 shall cease upon delivery to the Trustee of such ruling or
Opinion of Counsel and compliance with the other conditions precedent provided
for herein relating to the defeasance contemplated by this Section 8.02.
After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Notes and this Indenture except for those surviving obligations in the
immediately preceding paragraph.
SECTION 8.03. DEFEASANCE OF CERTAIN OBLIGATIONS. The Company may omit to
comply with any term, provision or condition set forth in clauses (iii) and (iv)
of Section 5.01 and Sections 4.03 through 4.12 and clause (c) of Section 6.01
with respect to clauses (iii) and (iv) of Section 5.01 and with respect to
Sections 4.11 and 4.12, clause (d) of Section 6.01 with respect
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to Sections 4.02 through 4.10 and 4.13 through 4.19 and clauses (e) and (f) of
Section 6.01 shall be deemed not to be Events of Default, in each case with
respect to the outstanding Notes if:
(i) with reference to this Section 8.03, the Company has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee (or another trustee satisfying the requirements of Section 7.10)
and conveyed all right, title and interest to the Trustee for the benefit
of the Holders, under the terms of an irrevocable trust agreement in form
and substance reasonably satisfactory to the Trustee as trust funds in
trust, specifically pledged to the Trustee for the benefit of the Holders
as security for payment of the principal of, premium, if any, and interest,
if any, on the Notes, and dedicated solely to, the benefit of the Holders,
in and to (A) money in an amount, (B) U.S. Government Obligations that,
through the payment of interest, premium, if any, and principal in respect
thereof in accordance with their terms, will provide, money in an amount or
(C) a combination thereof in an amount sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge, without consideration of the reinvestment of such interest and
after payment of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee, the principal of,
premium, if any, and interest on the outstanding Notes (i) on the Stated
Maturity of such principal or interest or (ii) on any earlier Redemption
Date; PROVIDED that the Trustee shall have been irrevocably instructed to
apply such money or the proceeds of such U.S. Government Obligations to the
payment of such principal, premium, if any, and interest with respect to
the Notes and, with respect to any Redemption Date, the Company shall have
provided the Trustee with irrevocable instructions to redeem all of the
Notes on such Redemption Date;
(ii) the Company has delivered to the Trustee an Opinion of Counsel
to the effect that (A) the creation of the defeasance trust does not
violate the Investment Company Act of 1940, (B) after the passage of 123
days following the deposit (except, with respect to any trust funds for the
account of any Holder who may be deemed to be an "insider" for purposes of
the United States Bankruptcy Code, after one year following the deposit),
the trust funds will not be subject to the effect of Xxxxxxx 000 xx xxx
Xxxxxx Xxxxxx Bankruptcy Code or Section 15 of the New York Debtor and
Creditor Law in a case commenced by or against the Company under either
such statute, and either (1) the trust funds will no longer remain the
property of the Company (and therefore will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally) or (2) if a court were to rule under
any such law in any case or proceeding that the trust funds remained
property of the Company, (x) assuming such trust funds remained in the
possession of the Trustee prior to such court ruling to the extent not paid
to the Holders, the Trustee will hold, for the benefit of the Holders, a
valid and perfected security interest in such trust funds that is not
avoidable in bankruptcy or otherwise (except for the effect of Section
552(b) of the United States
85
Bankruptcy Code on interest on the trust funds accruing after the
commencement of a case under such statute) and (y) the Holders will be
entitled to receive adequate protection of their interests in such trust
funds if such trust funds are used in such case or proceeding, (C) the
Holders will not recognize income, gain or loss for federal income tax
purposes as a result of such deposit and defeasance of certain covenants
and Events of Default and will be subject to federal income tax on the same
amount and in the same manner and at the same times as would have been the
case if such deposit and defeasance had not occurred and (D) the Trustee,
for the benefit of the Holders, has a valid first-priority security
interest in the trust funds;
(iii) immediately after giving effect to such deposit on a pro
forma basis, no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or during the period ending on the
123rd day after such date of such deposit, and such deposit shall not
result in a breach or violation of, or constitute a default under any other
material agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries
is bound;
(iv) if the Notes are then listed on a national securities
exchange, the Company has delivered to the Trustee an Opinion of Counsel to
the effect that the Notes will not be delisted as a result of such deposit,
defeasance and discharge; and
(v) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all
conditions precedent provided for herein relating to the defeasance
contemplated by this Section 8.03 have been complied with (which Opinion of
Counsel may rely on any Officers certificate as to matters of fact,
including, to the extent applicable, compliance with the foregoing clauses
(i),(ii), (iii) and (iv)).
SECTION 8.04. APPLICATION OF TRUST MONEY. Subject to Section 8.06, the
Trustee shall hold in trust money or U.S. Government Obligations deposited with
it pursuant to Section 8.01, 8.02 or 8.03, as the case may be, and shall apply
the deposited money and the money from U.S. Government Obligations in accordance
with the Notes and this Indenture to the payment of principal of, premium, if
any, and interest on the Notes; but such money need not be segregated from other
funds except to the extent required by law.
SECTION 8.05. REPAYMENT TO COMPANY. Subject to Sections 8.01, 8.02 and
8.03, the Trustee shall promptly pay to the Company upon request set forth in an
Officers' Certificate any excess money held by them at any time and thereupon
shall be relieved from all liability with respect to such money. The Trustee
shall pay to the Company upon request any money held by them for the payment of
principal, premium, if any, or interest that remains unclaimed for two years.
After payment to the Company, Holders entitled to such money must look to the
Company
86
for payment as general creditors unless an applicable law designates another
Person, and all liability of the Trustee with respect to such money shall cease.
SECTION 8.06. REINSTATEMENT. If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with Section 8.01,
8.02 or 8.03, as the case may be, by reason of any legal proceeding or by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the Company's obligations
under this Indenture and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01, 8.02 or 8.03, as the case may be,
until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with Section 8.01, 8.02 or
8.03, as the case may be; 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 U.S.
Government Obligations held by the Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company, when authorized by a
resolution of its Board of Directors (as evidenced by a Board Resolution
delivered to the Trustee), and the Trustee may amend or supplement this
Indenture or the Notes without notice to or the consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency in this
Indenture; provided that such amendments or supplements shall not, in the
good faith opinion of the Board of Directors as evidenced by a Board
Resolution, adversely affect the interests of the Holders in any material
respect;
(2) to comply with Article Five;
(3) to comply with any requirements of the Commission in connection
with the qualification of this Indenture under the TIA;
(4) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee;
(5) to provide for uncertificated Notes in addition to or in place
of certificated Notes;
87
(6) to add one or more Subsidiary Guarantees on the terms required
by this Indenture; or
(7) to make any change that, in the good faith opinion of the Board
of Directors as evidenced by a Board Resolution, does not materially and
adversely affect the rights of any Holder.
SECTION 9.02. WITH CONSENT OF HOLDERS. Subject to Sections 6.04 and 6.07
and without prior notice to the Holders, the Company, when authorized by its
Board of Directors (as evidenced by a Board Resolution delivered to the
Trustee), and the Trustee may amend this Indenture, the Pledge Agreement and the
Notes with the written consent of the Holders of not less than a majority in
aggregate principal amount of the Notes then outstanding, and the Holders of a
majority in aggregate principal amount of the Notes then outstanding by written
notice to the Trustee may waive future compliance by the Company with any
provision of this Indenture, the Pledge Agreement or the Notes.
Notwithstanding the provisions of this Section 9.02, without the consent of
each Holder affected, an amendment or waiver, including a waiver pursuant to
Section 6.04, may not:
(i) change the Stated Maturity of the principal of, or any
installment of interest on, any Note;
(ii) reduce the principal amount of, premium, if any, or interest
on any Note;
(iii) change any place or currency of payment of principal of,
premium, if any, or interest on, any Note;
(iv) impair the right of such Holder to institute suit for the
enforcement of any payment of principal, premium or interest on or after
the Stated Maturity (or, in the case of redemption, on or after the
Redemption Date) of any Note;
(v) reduce the percentage or principal amount of outstanding Notes
the consent of whose Holders is necessary to modify or amend this Indenture
or to waive compliance with certain provisions of or certain Defaults under
this Indenture;
(vi) waive a default in the payment of principal of, premium, if
any, or interest on, any Note;
(vii) modify the Pledge Agreement to release any collateral subject
to the Pledge Agreement (other than as contemplated thereby); or
88
(viii) modify any of the provisions of this Section 9.02, except to
increase any such percentage or to provide that certain other provisions of
this Indenture cannot be modified or waived without the consent of the
Holder of each outstanding Note affected thereby.
It shall not be necessary for the consent of the Holders under this Section
9.02 to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. The Company will mail
supplemental indentures to Holders upon request. 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 supplemental indenture or waiver.
SECTION 9.03. REVOCATION AND EFFECT OF CONSENT. Until an amendment or
waiver becomes effective, a consent to it by a Holder is a continuing consent by
the Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the Note of the consenting Holder, even if notation
of the consent is not made on any Note. However, subject to the last paragraph
of this Section 9.03, any such Holder or subsequent Holder may revoke the
consent as to its Note or portion of its Note. Such revocation shall be
effective only if the Trustee receives the notice of revocation before the date
on which the Trustee receives an Officers' Certificate certifying that the
Holders of the requisite principal amount of Notes have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver. An
amendment, supplement or waiver becomes effective on the later of the date of
receipt of such certificate and the date specified in such amendment, supplement
or waiver.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the last
two sentences of the immediately preceding paragraph, those persons who were
Holders at such record date (or their duly designated proxies) and only those
persons shall be entitled to consent to such amendment, supplement or waiver or
to revoke any consent previously given, whether or not such persons continue to
be Holders after such record date. No such consent shall be valid or effective
for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder unless it is of the type described in the second paragraph of
Section 9.02. In case of an amendment or waiver of the type described in the
second paragraph of Section 9.02, the amendment or waiver shall bind each Holder
who has consented to it and every subsequent Holder of a Note that evidences the
same indebtedness as the Note of the consenting Holder.
89
SECTION 9.04. NOTATION ON OR EXCHANGE OF NOTES. If an amendment, supplement
or waiver changes the terms of a Note, the Trustee may require the Holder to
deliver such Note to the Trustee. At the Company's expense, the Trustee may
place an appropriate notation on the Note about the changed terms and return it
to the Holder and the Trustee may place an appropriate notation on any Note
thereafter authenticated. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms. Failure to make
the appropriate notation, or issue a new Note, shall not affect the validity and
effect of such amendment, supplement or waiver.
SECTION 9.05. TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee shall be
entitled to receive, and shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and that it will be valid and binding upon the Company. Subject to the
preceding sentence, the Trustee shall sign such amendment, supplement or waiver
if the same does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. The Trustee may, but shall not be obligated to,
execute any such amendment, supplement or waiver that affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
SECTION 9.06. CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
indenture executed pursuant to this Article Nine shall conform to the
requirements of the TIA as then in effect.
ARTICLE TEN
SECURITY
SECTION 10.01. SECURITY. (a) On the Closing Date, the Company shall (i)
enter into the Pledge Agreement and comply with the terms and provisions thereof
and (ii) purchase the Pledged Securities to be pledged to the Trustee for the
benefit of the Holders in such amount as will be sufficient upon receipt of
scheduled interest and/or principal payments of such Pledged Securities, in the
opinion of a nationally recognized firm of independent public accountants
selected by the Company, to provide for payment in full of the first five
scheduled interest payments due on the Notes. In the event the Pledged
Securities to be purchased on the Closing Date are for any reason not purchased
by the Company, the Company shall purchase and deliver to the Trustee additional
Pledged Securities in such amount as will be sufficient upon receipt of
scheduled interest and/or principal payments of all Pledged Securities
thereafter held in the Pledge Account, in the opinion of a nationally recognized
firm of independent public accountants selected by the Company, to provide
payment for the first five scheduled interest payments due on the Notes. The
Pledged Securities shall be pledged by the Company to the Trustee for the
benefit of
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the Holders and shall be held by the Trustee in the Pledge Account pending
disposition pursuant to the Pledge Agreement.
(b) Each Holder, by its acceptance of a Note, consents and agrees to the
terms of the Pledge Agreement (including, without limitation, the provisions
providing for foreclosure and release of the Pledged Securities) as the same may
be in effect or may be amended from time to time in accordance with its terms,
and authorizes and directs the Trustee to enter into the Pledge Agreement and to
perform its respective obligations and exercise its respective rights thereunder
in accordance therewith. The Company will do or cause to be done all such acts
and things as may be necessary or as may be required by the provisions of the
Pledge Agreement, to assure and confirm to the Trustee the security interest in
the Pledged Securities contemplated hereby, by the Pledge Agreement 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,
or shall cause to be taken, upon request of the Trustee, any and all actions
reasonably required to cause the Pledge Agreement to create and maintain (to the
maximum extent permitted by law), as security for the obligations of the Company
under this Indenture and the Notes, valid and enforceable first priority liens
in and on all the Pledged Securities, in favor of the Trustee, superior to and
prior to the rights of third Persons and subject to no other Liens.
(c) The release of any Pledged Securities pursuant to the Pledge Agreement
will not be deemed to impair the security under this Indenture in contravention
of the provisions hereof if and to the extent the Pledged Securities are
released pursuant to this Indenture and the Pledge Agreement. To the extent
applicable, the Company shall cause TIA Section 314(d) relating to the release
of property or securities from the Lien and security interest of the Pledge
Agreement and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Pledge
Agreement to be complied with. Any certificate or opinion required by TIA
Section 314(d) may be made by an officer of the Company, 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 by the Company.
(d) The Company shall cause TIA Section 314(b), relating to opinions of
counsel regarding the Lien under the Pledge Agreement, to be complied with. The
Trustee may, to the extent permitted by Sections 7.01 and 7.02 hereof, accept as
conclusive evidence of compliance with the foregoing provisions the appropriate
statements contained in such instruments.
(e) The Trustee may, in its sole discretion and without the consent of the
Holders, on behalf of the Holders, take all actions it deems necessary or
appropriate in order to (i) enforce any of the terms of the Pledge Agreement and
(ii) collect and receive any and all amounts payable in respect of the
obligations of the Company thereunder. The Trustee shall have power to institute
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and to maintain such suits and proceedings as the Trustee may deem expedient to
preserve or protect its interests and the interests of the Holders in the
Pledged Securities (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).
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TRUST INDENTURE ACT OF 1939. Prior to the effectiveness of
the Registration Statement, this Indenture shall incorporate and be governed by
the provisions of the TIA that are required to be part of and to govern
indentures qualified under the TIA. After the effectiveness of the Registration
Statement, this Indenture shall be subject to the provisions of the TIA that are
required to be a part of this Indenture and shall, to the extent applicable, be
governed by such provisions.
SECTION 11.02. NOTICES. Any notice or communication hereunder shall be
sufficiently given if in writing, in English, and delivered in person, mailed by
first-class mail or sent by telecopier transmission addressed as follows:
IF TO THE COMPANY:
Carrier1 International S.A.
c/o Carrier1 International GmbH
Xxxxxxxxxxxxxx 00
XX-0000 Xxxxxx
Xxxxxxxxxxx
Telecopier No.: 011-41-1-297-2601
Attention: General Counsel
IF TO THE TRUSTEE:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000-0000
Telecopier No.: (000) 000-0000 or 8178
Attention: Capital Markets Fiduciary Services
The Company or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
92
Any notice or communication mailed to a Holder shall be mailed to it at its
address as it appears on the Security Register by first-class mail and shall be
sufficiently given to him if so mailed within the time prescribed. Any notice or
communication shall also be so mailed to any Person described in TIA Section
313(c), to the extent required by the TIA. Copies of any such communication or
notice to a Holder shall also be mailed to the Trustee and each Agent at the
same time.
Failure to mail a notice or communication to a Holder as provided herein or
any defect in any such notice or communication shall not affect its sufficiency
with respect to other Holders. Except for a notice to the Trustee, which is
deemed given only when received, and except as otherwise provided in this
Indenture, if a notice or communication is mailed in the manner provided in this
Section 11.02, it is duly given, whether or not the addressee receives it.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.
Holders may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
SECTION 11.03. 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:
(i) an Officers' Certificate to the effect that, in the opinion of
the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(ii) an Opinion of Counsel to the effect that, in the opinion of
such Counsel, all such conditions precedent have been complied with.
Notwithstanding the foregoing, in the case of any such request or
application as to which the furnishing of any Officers' Certificate or Opinion
of Counsel is specifically required by any
93
provision of this Indenture relating to such particular request or application,
no additional certificate or opinion need be furnished.
SECTION 11.04. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. Subject to
the last paragraph of Section 11.03, each certificate or opinion with respect to
compliance with a condition or covenant provided for in this Indenture (except
for certificates provided for in Section 4.16) shall include:
(i) a statement that each person signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion
contained in such certificate or opinion is based;
(iii) a statement that, in the opinion of each such person, he
has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(iv) a statement as to whether or not, in the opinion of each
such person, such condition or covenant has been complied with;
PROVIDED, HOWEVER, that, with respect to matters of fact, an Opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
SECTION 11.05. RULES BY TRUSTEE, PAYING AGENT OR REGISTRAR. The Trustee
may make reasonable rules for action by or at a meeting of Holders. The Paying
Agent or Registrar may make reasonable rules for its functions.
SECTION 11.06. PAYMENT DATE OTHER THAN A BUSINESS DAY. If an Interest
Payment Date, Redemption Date, Payment Date, Stated Maturity or date of maturity
of any Note shall not be a Business Day, then payment of principal of, premium,
if any, or interest on such Note, as the case may be, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the Interest Payment Date, Payment Date or Redemption
Date, or at the Stated Maturity or date of maturity of such Note; PROVIDED that
no interest shall accrue for the period from and after such Interest Payment
Date, Payment Date, Redemption Date, Stated Maturity or date of maturity, as the
case may be.
SECTION 11.07. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any Subsidiary of the Company. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
94
SECTION 11.08. NO RECOURSE AGAINST OTHERS. No recourse for the payment
of the principal of, premium, if any, or interest on any of the Notes, or for
any claim based thereon or otherwise in respect thereof, and no recourse under
or upon any obligation, covenant or agreement of the Company contained in this
Indenture or in any of the Notes, or because of the creation of any Indebtedness
represented thereby, shall be had against any incorporator or against any past,
present or future partner, shareholder, other equityholder, officer, director,
employee or controlling person, as such, of the Company or of any successor
Person, either directly or through the Company or any successor Person, whether
by virtue of any constitution, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly understood that all
such liability is hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the issue of the Notes.
SECTION 11.09. 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 successor.
SECTION 11.10. DUPLICATE ORIGINALS. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
SECTION 11.11. SEPARABILITY. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 11.12. 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 hereof and shall in no way modify or restrict any of the terms
and provisions hereof.
SECTION 11.13. SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR
SERVICE. (a) With respect to any suit, action, or proceeding that may be brought
in connection with this Indenture or the Notes or any Guarantee, if any, the
Company irrevocably consents to the jurisdiction of any United States federal or
New York state court sitting in the Borough of Manhattan, The City of New York,
the State of New York and irrevocably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding and any claim of inconvenient forum, and
irrevocably submits to the non-exclusive jurisdiction of any such court in any
such suit, action or proceeding.
(b) The Company (i) irrevocably designates and appoints CT Corporation
System, 0000 Xxxxxxxx, Xxx Xxxx, XX 00000 (together with any successor, the
"AUTHORIZED AGENT"),
95
as its authorized agent upon which process may be served in any suit, action or
proceeding described in the first sentence of this Section 11.13 and represents
and warrants that the Authorized Agent has accepted such designation and (ii)
agrees that service of process upon the Authorized Agent and written notice of
said service to the Company (mailed or delivered to its General Counsel at its
executive office at Xxxxxxxxxxxxxx 00, XX-0000, Xxxxxx, Xxxxxxxxxxx), shall be
deemed in every respect effective service of process upon the Company in any
such suit or proceeding. The Company further agrees to take any and all action,
including the execution and filing of any and all such documents and
instruments, as may be necessary to continue such designation and appointment of
the Authorized Agent in full force and effect so long as any of the Notes shall
be outstanding.
(c) To the extent that the Company has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, it
hereby irrevocably waives such immunity in respect of its obligations under the
above-referenced documents, to the extent permitted by law.
SECTION 11.14. JUDGMENT CURRENCY. The Company hereby agrees to
indemnify the Trustee, its directors, its officers and each person, if any, who
controls the Trustee within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act against any loss incurred by such person as a
result of any judgment or order being made or given against the Company for any
U.S. dollar amount due under this Agreement and such judgment or order being
express and paid in a currency (the "JUDGMENT CURRENCY") other than U.S. dollars
and as a result of any variation as between (i) the rate of exchange at which
the U.S. dollar amount is converted into the Judgment Currency for the purpose
of such judgment or order and (ii) the spot rate of exchange in The City of New
York on which such party on the date of payment of such judgment or order is
able to purchase U.S. dollars with the amount of the Judgment Currency actually
received by such party. The foregoing indemnity shall continue in full force and
effect notwithstanding any such judgment or order. The term "spot rate of
exchange" shall include any premiums or costs of exchange payable in connection
with the purchase of, or conversion into U.S. dollars.
SECTION 11.15. GOVERNING LAW. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
UPON THE ISSUANCE OF THE EXCHANGE NOTES OR THE EFFECTIVENESS OF THE SHELF
REGISTRATION STATEMENT, THIS INDENTURE SHALL BE SUBJECT TO THE PROVISIONS OF THE
TRUST INDENTURE ACT OF 1939, AS AMENDED, THAT ARE REQUIRED TO BE PART OF THIS
INDENTURE AND SHALL, TO THE EXTENT APPLICABLE, BE GOVERNED BY SUCH PROVISIONS.
96
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
CARRIER1 INTERNATIONAL S.A.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
By: /s/ Xxxx X. Xxxxxx
---------------------------------
Name: Xxxx X. Xxxxxx
Title: Director
THE CHASE MANHATTAN BANK, Trustee
By: /s/ Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Assistant Treasurer
EXHIBIT A
[FACE OF NOTE]
CARRIER1 INTERNATIONAL S.A.
13 1/4% Senior Dollar Note due 2009
[CUSIP] [CINS] [ISIN] [ ]
----------
No. $
---- ---------
CARRIER1 INTERNATIONAL S.A., a societe anonyme organized under the laws of
the Grand Duchy of Luxembourg (the "Company", which term includes any successor
under the Indenture hereinafter referred to), for value received, promises to
pay to _____________, or its registered assigns, the principal sum of
____________ ($____________________) on February 15, 2009.
Interest Payment Dates: February 15 and August 15, commencing August 15,
1999.
Regular Record Dates: February 1 and August 1.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
A-2
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
CARRIER1 INTERNATIONAL S.A.
By:
----------------------------
Name:
Title:
(Trustee's Certificate of Authentication)
This is one of the 13 1/4% Senior Dollar Notes due 2009 described in the
within-mentioned Indenture.
Date: THE CHASE MANHATTAN BANK,
as Trustee
By:
----------------------------
Authorized Signatory
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[REVERSE SIDE OF NOTE]
CARRIER1 INTERNATIONAL S.A.
13 1/4% Senior Dollar Note due 2009
1. PRINCIPAL AND INTEREST.
The Company will pay the principal of this Note on February 15, 2009.
The Company promises to pay interest on the principal amount of this Note
on each Interest Payment Date, as set forth below, at the rate per annum shown
above.
Interest will be payable semiannually (to the holders of record of the
Notes at the close of business on the February 1 or August 1 immediately
preceding the Interest Payment Date) on each Interest Payment Date.
[If an exchange offer (the "Exchange Offer") registered under the
Securities Act is not consummated and a shelf registration statement (the "Shelf
Registration Statement") under the Securities Act with respect to resales of the
Notes is not declared effective by the Commission, on or before August 19, 1999
in accordance with the terms of the Registration Rights Agreement dated February
12, 1999 between the Company, Xxxxxx Xxxxxxx & Co. Incorporated, Xxxxxxx Xxxxx
Barney Inc., Warburg Dillon Read LLC and Bear, Xxxxxxx & Co. Inc., the annual
interest rate borne by the Notes shall be increased by 0.5% from the rate shown
above accruing from August 19, 1999, payable in cash semiannually, in arrears,
on each Interest Payment Date, commencing February 15, 2000 until the Exchange
Offer is consummated or the Shelf Registration Statement is declared effective.
The Holder of this Note is entitled to the benefits of such Registration Rights
Agreement.]*
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from February 19, 1999;
PROVIDED that, if there is no existing default in the payment of interest and
this Note is authenticated between a Regular Record Date referred to on the face
hereof and the next succeeding Interest Payment Date, interest shall accrue
--------
* To be omitted from Exchange Notes. Substantially similar language to be
included or omitted, as the case may be with respect to Additional Notes,
MUTATIS MUTANDI.
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from such Interest Payment Date. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and premium, if any,
and interest on overdue installments of interest, to the extent lawful, at a
rate per annum that is 2% in excess of the rate otherwise payable.
Under certain circumstances described in the Indenture, the Company also
shall pay Additional Amounts to the Holders of Notes equal to an amount that the
Company may be required to withhold or deduct for or on account of Taxes imposed
by a Taxing Authority, from any payment made under or with respect to the Notes.
2. METHOD OF PAYMENT.
The Company will pay interest (except defaulted interest) on the principal
amount of the Notes as provided above on each February 15 and August 15,
commencing August 15, 1999 to the persons who are Holders (as reflected in the
Security Register at the close of business on the February 1 or August 1
immediately preceding the Interest Payment Date), in each case, even if the Note
is canceled on registration of transfer or registration of exchange after such
record date; PROVIDED that, with respect to the payment of principal, the
Company will make payment to the Holder that surrenders this Note to a Paying
Agent on or after February 15, 2009.
The Company will pay principal, premium, if any, and as provided above,
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal, premium, if any, and interest by its check payable in such money. It
may mail an interest check to a Holder's registered address (as reflected in the
Security Register). If a payment date is a date other than a Business Day at a
place of payment, payment may be made at that place on the next succeeding day
that is a Business Day and no interest shall accrue for the intervening period.
3. PAYING AGENT AND REGISTRAR.
Initially, the Trustee will act as authenticating agent, Paying Agent and
Registrar. The Company may change any authenticating agent, Paying Agent or
Registrar without notice. The Company, any Subsidiary or any Affiliate of any of
them may act as Paying Agent, Registrar or co-Registrar.
4. INDENTURE; LIMITATIONS.
The Company issued the Notes under an Indenture dated as of February 19,
1999 (the "Indenture"), between the Company and The Chase Manhattan Bank,
trustee (the "Trustee"). Capitalized terms herein are used as defined in the
Indenture unless otherwise indicated. The
A-5
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act. The Notes are subject to
all such terms, and Holders are referred to the Indenture and the Trust
Indenture Act for a statement of all such terms. To the extent permitted by
applicable law, in the event of any inconsistency between the terms of this Note
and the terms of the Indenture, the terms of the Indenture shall control.
The Notes are general unsecured obligations of the Company except to the
extent set forth in Article Ten of the Indenture and the Pledge Agreement.
The Company may, subject to Article Four of the Indenture and applicable
law, issue Additional Notes under the Indenture.
5. OPTIONAL REDEMPTION.
The Notes are redeemable, at the Company's option, in whole or in part, at
any time or from time to time, on or after February 15, 2004 and prior to
maturity, upon not less than 30 nor more than 60 days' prior notice mailed by
first class mail to each Holder's last address, as it appears in the Security
Register, at the following Redemption Prices (expressed in percentages of
principal amount), plus accrued and unpaid interest, if any, to the Redemption
Date (subject to the right of Holders of record on the relevant Regular Record
Date that is on or prior to the Redemption Date to receive interest due on an
Interest Payment Date), if redeemed during the 12-month period commencing
February 15 of the years set forth below:
YEAR REDEMPTION PRICE
---- ----------------
2004............. 106.625%
2005............. 104.417
2006............. 102.208
2007 and thereafter 100.000
At any time prior to February 15, 2002, the Company at its option may
redeem Notes in an aggregate principal amount equal to up to 35% of the
principal amount of the Notes (including the principal amount of any Additional
Notes), with funds in an amount equal to the proceeds of one or more sales of
Capital Stock (other than Disqualified Stock) of, or capital contributions to,
the Company, at any time or from time to time in part, at a Redemption Price
(expressed as a percentage of principal amount) of 113.25%, plus accrued and
unpaid interest, if any, to the Redemption Date (subject to the rights of
Holders of record on the relevant Regular Record Date that is prior to the
Redemption Date to receive interest due on an Interest Payment Date); PROVIDED
that (i) an aggregate principal amount equal to at least 65% of the principal
amount of the initially
A-6
issued Notes (plus the principal amount of any Additional Notes) remains
outstanding after each such redemption and (ii) notice of such redemption is
mailed within 60 days of each such sale or capital contribution.
In the event that (i) as a result of any change in, or amendments to, any
laws or treaties (or any regulations or rulings promulgated thereunder) or any
change in official position regarding the application of such laws, treaties,
regulations or rulings (including a holding, judgement or order by a court of
competent jurisdiction), which change, amendment, application or interpretation
becomes effective after the Closing Date, the Company has become or would become
obligated to pay, on the next date on which any amount would be payable under or
with respect to the Notes, any Additional Amounts, and (ii) the Company cannot
reasonably arrange (without other material adverse consequences to the Company)
for another obligor to make such payment so as to avoid the requirement to pay
such Additional Amounts, then the Company may redeem all, but not less than all,
the Notes at any time at 100% of the principal amount thereof, together with
accrued interest thereon, if any, to the Redemption Date.
Notes in original denominations larger than $1,000 may be redeemed in part.
On and after the Redemption Date, interest ceases to accrue on Notes or portions
of Notes called for redemption, unless the Company defaults in the payment of
the Redemption Price.
6. REPURCHASE UPON CHANGE OF CONTROL.
Upon the occurrence of any Change of Control, each Holder shall have the
right to require the repurchase of its Notes by the Company in cash pursuant to
the offer described in the Indenture at a purchase price equal to 101% of the
principal amount thereof plus accrued and unpaid interest, if any, to the date
of purchase (the "Payment Date").
A notice of such Change of Control will be mailed within 30 days after any
Change of Control occurs to each Holder at its last address as it appears in the
Security Register. Notes in original denominations larger than $1,000 may be
sold to the Company in part. On and after the Payment Date, interest ceases to
accrue on Notes or portions of Notes surrendered for purchase by the Company,
unless the Company defaults in the payment of the purchase price.
7. DENOMINATIONS; TRANSFER; EXCHANGE.
The Notes are in registered form without coupons in denominations of $1,000
of principal amount and multiples of $1,000 in excess thereof. A Holder may
register the transfer or exchange of Notes in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
or exchange of any Notes selected for redemption. Also, it need not register the
transfer or exchange
A-7
of any Notes for a period of 15 days before the day of mailing of a notice of
redemption of Notes selected for redemption.
8. PERSONS DEEMED OWNERS.
A Holder shall be treated as the owner of a Note for all purposes.
9. UNCLAIMED MONEY.
If money for the payment of principal, premium, if any, or interest remains
unclaimed for two years, the Trustee will pay the money back to the Company at
its request. After that, Holders entitled to the money must look to the Company
for payment, unless an abandoned property law designates another Person, and all
liability of the Trustee with respect to such money shall cease.
10. DISCHARGE PRIOR TO REDEMPTION OR MATURITY.
If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Notes (a) to redemption or maturity, the
Company will be discharged from the Indenture and the Notes, except in certain
circumstances for certain provisions thereof, and (b) to the Stated Maturity,
the Company will be discharged from certain covenants set forth in the
Indenture.
11. AMENDMENT; SUPPLEMENT; WAIVER.
Subject to certain exceptions, the Indenture, the Pledge Agreement or the
Notes may be amended or supplemented with the consent of the Holders of at least
a majority in principal amount of the Notes then outstanding, and any existing
default or compliance with any provision may be waived with the consent of the
Holders of at least a majority in principal amount of the Notes then
outstanding. Without notice to or the consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Notes to, among other things, cure
any ambiguity, defect or inconsistency and make any change that does not
materially and adversely affect the rights of any Holder.
12. RESTRICTIVE COVENANTS.
The Indenture imposes certain limitations on the ability of the Company and
its Restricted Subsidiaries, among other things, to Incur additional
Indebtedness, make Restricted Payments, suffer to exist restrictions on the
ability of Restricted Subsidiaries to make certain payments to the Company,
issue Capital Stock of Restricted Subsidiaries, Guarantee Indebtedness of the
Company, engage in transactions with Affiliates, suffer to exist or incur Liens,
enter into sale-leaseback transactions, use the proceeds from Asset Sales, or
merge, consolidate or transfer substantially
A-8
all of its assets. Within 90 days after the end of each fiscal year, the Company
shall deliver to the Trustee an Officers' Certificate stating whether or not the
signers thereof know of any Default or Event of Default under such restrictive
covenants.
13. SUCCESSOR PERSONS.
When a successor person or other entity assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor person will be
released from those obligations.
14. DEFAULTS AND REMEDIES.
Any of the following events constitutes an "Event of Default" under the
Indenture:
(a) default in the payment of principal of (or premium, if any, on)
any Note when the same becomes due and payable at maturity, upon
acceleration, redemption or otherwise;
(b) default in the payment of interest on any Note when the same
becomes due and payable, and such default continues for a period of 30
days; PROVIDED that a failure to make any of the first five scheduled
interest payments on the relevant series of Notes on the applicable
Interest Payment Date will constitute an Event of Default with no grace or
cure period;
(c) default in the performance or breach of the provisions of
Article Five of the Indenture or the failure to make or consummate an Offer
to Purchase when required in accordance with Section 4.11 or 4.12 of the
Indenture;
(d) the Company defaults in the performance of or breaches any
other covenant or agreement of the Company in the Indenture or under the
Notes (other than a default specified in clause (a), (b) or (c) above) or
the Pledge Agreement and such default or breach continues for a period of
30 consecutive days after written notice by the Trustee or the Holders of
25% or more in aggregate principal amount of the Notes;
(e) there occurs with respect to any issue or issues of
Indebtedness of the Company or any Significant Subsidiary having an
outstanding principal amount of $10 million or more in the aggregate for
all such issues of all such Persons, whether such Indebtedness now exists
or shall hereafter be created, (I) an event of default that has caused the
holder thereof to declare such Indebtedness to be due and payable prior to
its Stated Maturity and such Indebtedness has not been discharged in full
or such acceleration has not been rescinded or annulled within 30 days of
such acceleration and/or (II) the failure to make a principal payment at
the final (but not any interim) fixed maturity and
A-9
such defaulted payment shall not have been made, waived or extended within
30 days of such payment default;
(f) any final judgment or order (not covered by insurance) for the
payment of money in excess of $10 million in the aggregate for all such
final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any Significant Subsidiary and shall not be
paid or discharged, and there shall be any period of 60 consecutive days
following entry of the final judgment or order that causes the aggregate
amount for all such final judgments or orders outstanding and not paid or
discharged against all such Persons to exceed $10 million during which a
stay of enforcement of such final judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
(g) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Company or any Significant
Subsidiary in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, (B) appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Company or any Significant Subsidiary or for all or
substantially all of the property and assets of the Company or any
Significant Subsidiary or (C) the winding up or liquidation of the affairs
of the Company or any Significant Subsidiary and, in each case, such decree
or order shall remain unstayed and in effect for a period of 30 consecutive
days;
(h) the Company or any Significant Subsidiary (A) commences a
voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (C) effects any
general assignment for the benefit of creditors; or
(i) the Pledge Agreement shall cease to be in full force and effect
or enforceable in accordance with its terms, other than in accordance with
its terms.
If an Event of Default (other than an Event of Default specified in clause
(g) or (h) above that occurs with respect to the Company) occurs and is
continuing, the Trustee may, and at the direction of the Holders of at least 25%
in aggregate principal amount of the Notes then outstanding shall, declare all
the Notes to be due and payable. If a bankruptcy or insolvency default with
respect to the Company occurs and is continuing, the Notes automatically become
due and payable. Holders may not enforce the Indenture or the Notes except as
provided in the
A-10
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Notes. Subject to certain limitations, Holders of
at least a majority in principal amount of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.
15. SECURITY.
The Company has entered into the Pledge Agreement for the purchase and
pledge to the Trustee for the benefit of the Holders, Pledged Securities in an
amount sufficient upon receipt of scheduled interest and principal payments on
such securities to provide for payment in full of the first five scheduled
interest payments due on the Notes. The Pledged Securities will be pledged by
the Company to the Trustee for the benefit of the Holders and will be held by
the Trustee in the Pledge Account pending disbursement pursuant to the Pledge
Agreement.
16. TRUSTEE DEALINGS WITH THE COMPANY.
The Trustee under the Indenture, in its individual or any other capacity,
may make loans to, accept deposits from and perform services for the Company or
its Affiliates and may otherwise deal with the Company or its Affiliates as if
it were not the Trustee.
17. NO RECOURSE AGAINST OTHERS.
No incorporator or any past, present or future partner, shareholder, other
equityholder, officer, director, employee or controlling person, as such, of the
Company or of any successor Person shall have any liability for any obligations
of the Company under the Notes or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.
18. AUTHENTICATION.
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
19. 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).
A-11
The Company will furnish a copy of the Indenture to any Holder upon
written request and without charge. Requests may be made to Carrier1
International S.A, c/o Carrier1 International GmbH, Xxxxxxxxxxxxxx 00, XX-0000
Xxxxxx, Xxxxxxxxxxx; Attention: Kees van Ophem, Vice President Purchase and
General Counsel.
20. SUBMISSION TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE.
In connection with the Indenture or the Notes or any Guarantee, if any,
the Company irrevocably consents to the jurisdiction of any court of the
State of New York or any United States federal court sitting in the Borough
of Manhattan, The City of New York, the State of New York and irrevocably
waives, to the fullest extent permitted by law, any objection to any suit,
action, or proceeding that may be brought which it may now or hereafter have
to the laying of the venue of any such suit, action or proceeding and any
claim of inconvenient forum, and irrevocably submits to the non-exclusive
jurisdiction of any such court in any such suit, action or proceeding. In
connection with any Guarantee, the Company shall use reasonable efforts to
cause the issuer of any Guarantee to submit to jurisdiction to substantially
the same extent.
The Company (i) irrevocably designates and appoints CT Corporation System,
0000 Xxxxxxxx, Xxx Xxxx, XX 00000 (together with any successor, the "Authorized
Agent"), as its authorized agent upon which process may be served in any such
suit, action or proceeding and (ii) agrees that service of process upon the
Authorized Agent and written notice of said service to the Company (mailed or
delivered to its General Counsel at its executive office at Xxxxxxxxxxxxxx 00,
XX-0000, Xxxxxx, Xxxxxxxxxxx), shall be deemed in every respect effective
service of process upon the Company in any such suit or proceeding.
To the extent that the Company has or hereafter may acquire any immunity
from jurisdiction of any court or from any legal process (whether through
service of notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) with respect to itself or its property, it hereby
irrevocably waives such immunity in respect of its obligations under the
Indenture or the Notes, to the extent permitted by law.
THIS NOTE AND THE INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
A-12
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
INSERT TAXPAYER IDENTIFICATION NO.
----------------------------------
--------------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
--------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ______________________________________ attorney to transfer said Note
on the books of the Company with full power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL NOTES OTHER THAN EXCHANGE NOTES AND UNLEGENDED NOTES]
In connection with any transfer of this Note occurring prior to the date
which is the earlier of (i) the date the Shelf Registration Statement is
declared effective or (ii) the end of the period referred to in Rule 144(k)
under the Securities Act, the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[CHECK ONE]
[ ] (a) this Note is being transferred in compliance with the
exemption from registration under the Securities Act of 1933, as
amended, provided by Rule 144A thereunder.
OR
[ ] (b) this Note is being transferred other than in accordance
with (a) above and documents are being furnished which comply
with the conditions of transfer set forth in this Note and the
Indenture.
A-13
If none of the foregoing boxes is checked, the Trustee or other Registrar shall
not be obligated to register this Note in the name of any Person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.08 of the Indenture shall have
been satisfied.
Date:
------------------ -------------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933, as amended,
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
------------------------ -------------------------------------------
NOTICE: To be executed by an executive
officer
A-14
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to Section
4.11 or 4.12 of the Indenture, check the Box: |_|
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.11 or 4.12 of the Indenture, state the amount (in
principal amount):
$
-------------------.
Date:
-------------------
Your Signature:
------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:
--------------------------------
EXHIBIT B
Form of Certificate
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000-0000
Telecopier No.: (000) 000-0000 or 8178
Attention: Capital Markets Fiduciary Services
RE: CARRIER1 INTERNATIONAL S.A. (THE "COMPANY")
13 1/4% SENIOR DOLLAR NOTES DUE 2009 (THE "NOTES")
Dear Sirs:
This letter relates to U.S.$________ principal amount of Notes
represented by a Note (the "Legended Note") which bears a legend outlining
restrictions upon transfer of such Legended Note. Pursuant to Section 2.02(a)
of the Indenture dated as of February 19, 1999 (the "Indenture") relating to
the Notes, we hereby certify that we are (or we will hold such securities on
behalf of) a person outside the United States to whom the Notes could be
transferred in accordance with Rule 904 of Regulation S promulgated under the
U.S. Securities Act of 1933, as amended. Accordingly, you are hereby
requested to exchange the legended certificate for an unlegended certificate
representing an identical principal amount of Notes, all in the manner
provided for in the Indenture.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
---------------------------------
Authorized Signatory
EXHIBIT C
FORM OF CERTIFICATE TO BE
DELIVERED IN CONNECTION WITH
TRANSFERS TO NON-QIB ACCREDITED INVESTORS
__________, __
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000-0000
Telecopier No.: (000) 000-0000 or 8178
Attention: Capital Markets Fiduciary Services
RE: CARRIER1 INTERNATIONAL S.A. (THE "COMPANY")
13 1/4% SENIOR DOLLAR NOTES DUE 2009 (THE "NOTES")
Dear Sirs:
In connection with our proposed purchase of $___________ aggregate
principal amount of the Notes, in accordance with Section 2.08(a) of the
Indenture referred to below, we confirm that:
1. We understand that any subsequent transfer of the Notes is subject to
certain restrictions and conditions set forth in the Indenture dated as of
February 19, 1999 (the "Indenture") relating to the Notes and the undersigned
agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes
except in compliance with such restrictions and conditions and the Securities
Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes may not be offered or
sold except as permitted in the following sentence. We agree, on our own behalf
and on behalf of any accounts for which we are acting as hereinafter stated,
that if we should sell or otherwise transfer any Notes within the time period
referred to in Rule 144(k) of the Securities Act, we will do so only (A) to the
Company or any subsidiary thereof, (B) in accordance with Rule 144A under the
Securities Act to a "qualified institutional buyer" (as defined therein), (C) to
an institutional "accredited investor" (as defined below) that, prior to such
transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to
you and to the Company a signed letter substantially in the form of this letter
and, if such transfer is in respect of an aggregate principal amount of Notes
C-2
at the time of transfer of less than $250,000, an opinion of counsel acceptable
to the Company that such transfer is in compliance with the Securities Act, (D)
to a person outside the United States in an offshore transaction in compliance
with Regulation S under the Securities Act, (E) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if available) or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing any of the Notes from us a
notice advising such purchaser that resales of the Notes are restricted as
stated herein.
3. We understand that, on any proposed resale of any Notes, we will be
required to furnish to you and the Company such certifications, legal opinions
and other information as you and the Company may reasonably require to confirm
that the proposed sale complies with the foregoing restrictions. We further
understand that the Notes purchased by us will bear a legend to the foregoing
effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes purchased by us for our own account or for
one or more accounts (each of which is an institutional "accredited investor")
as to each of which we exercise sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
--------------------------------------------
Authorized Signatory
EXHIBIT D
FORM OF CERTIFICATE TO BE DELIVERED IN
CONNECTION WITH TRANSFERS PURSUANT TO REGULATION S
__________, __
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000-0000
Telecopier No.: (000) 000-0000 or 8178
Attention: Capital Markets Fiduciary Services
RE: CARRIER1 INTERNATIONAL S.A. (THE "COMPANY")
13 1/4% SENIOR DOLLAR NOTES DUE 2009 (THE "NOTES")
Dear Sirs:
In connection with our proposed sale of U.S.$_________ aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended, and, accordingly, we represent that:
(1) the offer of the Notes (and any Units of which they may form a part)
was not made to a person in the United States;
(2) at the time the buy order was originated, the transferee was outside
the United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States;
(3) no directed selling efforts have been made by us in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation
S, as applicable; and
(4) the transfer is not part of a plan or scheme to evade the registration
requirements of the U.S. Securities Act of 1933.
D-2
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
---------------------------
Authorized Signatory
