FORM OF
ECHOSTAR COMMUNICATIONS CORPORATION
$___________
12 1/8% SENIOR EXCHANGE NOTES DUE 2004
INDENTURE
Dated as of January [ ], 1999
U.S. Bank Trust National Association
Trustee
INDENTURE dated as of January [ ], 1999 among EchoStar Communications
Corporation (the "Company" or "EchoStar"), a Nevada corporation, and U.S.
Bank Trust National Association as trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the 12 1/8%
Senior Exchange Notes due 2004:
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE . . . . . . . . . . . . . . . 1
SECTION 1.1 DEFINITIONS.. . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.2 OTHER DEFINITIONS.. . . . . . . . . . . . . . . . . . 16
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT . . 17
SECTION 1.4 RULES OF CONSTRUCTION.. . . . . . . . . . . . . . . . 17
ARTICLE 2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.1 FORM AND DATING . . . . . . . . . . . . . . . . . . . 18
SECTION 2.2 FORM OF EXECUTION AND AUTHENTICATION. . . . . . . . . 19
SECTION 2.3 REGISTRAR AND PAYING AGENT. . . . . . . . . . . . . . 20
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST.. . . . . . . . . 21
SECTION 2.5 LISTS OF HOLDERS OF THE NOTES.. . . . . . . . . . . . 21
SECTION 2.6 TRANSFER AND EXCHANGE.. . . . . . . . . . . . . . . . 21
SECTION 2.7 REPLACEMENT NOTES.. . . . . . . . . . . . . . . . . . 22
SECTION 2.8 OUTSTANDING NOTES.. . . . . . . . . . . . . . . . . . 23
SECTION 2.9 TREASURY NOTES. . . . . . . . . . . . . . . . . . . . 23
SECTION 2.10 TEMPORARY NOTES.. . . . . . . . . . . . . . . . . . . 23
SECTION 2.11 CANCELLATION. . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.12 DEFAULTED INTEREST. . . . . . . . . . . . . . . . . . 24
SECTION 2.13 RECORD DATE.. . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.14 CUSIP NUMBER. . . . . . . . . . . . . . . . . . . . . 24
ARTICLE 3
REDEMPTION. . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.1 NOTICES TO TRUSTEE. . . . . . . . . . . . . . . . . . 25
SECTION 3.2 SELECTION OF NOTES TO BE REDEEMED.. . . . . . . . . . 25
SECTION 3.3 NOTICE OF REDEMPTION. . . . . . . . . . . . . . . . . 25
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION. . . . . . . . . . . . 26
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE.. . . . . . . . . . . . . 27
SECTION 3.6 NOTES REDEEMED IN PART. . . . . . . . . . . . . . . . 27
SECTION 3.7 OPTIONAL REDEMPTION.. . . . . . . . . . . . . . . . . 27
SECTION 3.8 MANDATORY REDEMPTION. . . . . . . . . . . . . . . . . 28
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ARTICLE 4
COVENANTS . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 4.1 PAYMENT OF NOTES. . . . . . . . . . . . . . . . . . . 28
SECTION 4.2 MAINTENANCE OF OFFICE OR AGENCY.. . . . . . . . . . . 29
SECTION 4.3 REPORTS.. . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 4.4 COMPLIANCE CERTIFICATE. . . . . . . . . . . . . . . . 31
SECTION 4.5 TAXES.. . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.6 STAY, EXTENSION AND USURY LAWS. . . . . . . . . . . . 32
SECTION 4.7 RESTRICTED PAYMENTS.. . . . . . . . . . . . . . . . . 32
SECTION 4.8 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . . 35
SECTION 4.9 INCURRENCE OF INDEBTEDNESS, ISSUANCE OF DISQUALIFIED
STOCK AND ISSUANCE OF PREFERRED EQUITY INTERESTS OF
SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . 36
SECTION 4.10 ASSET SALES . . . . . . . . . . . . . . . . . . . . . 39
SECTION 4.11 TRANSACTIONS WITH AFFILIATES. . . . . . . . . . . . . 40
SECTION 4.12 [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 41
SECTION 4.13 SUBSIDIARY GUARANTEES . . . . . . . . . . . . . . . . 41
SECTION 4.14 . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 4.15 OFFER TO PURCHASE UPON CHANGE OF CONTROL OR ORBITAL
EVENT. . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 4.16 [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 44
SECTION 4.17 [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 44
SECTION 4.18 ACTIVITIES OF ECHOSTAR. . . . . . . . . . . . . . . . 44
SECTION 4.19 [INTENTIONALLY OMITTED. . . . . . . . . . . . . . . . 44
SECTION 4.20 [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 44
SECTION 4.21 [INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 45
SECTION 4.22 SIGNIFICANT TRANSACTIONS. . . . . . . . . . . . . . . 45
SECTION 4.23 ACCOUNTS RECEIVABLE SUBSIDIARY. . . . . . . . . . . . 46
ARTICLE 5
SUCCESSORS. . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.1 MERGER, CONSOLIDATION, OR SALE OF ASSETS. . . . . . . 49
SECTION 5.3 SUCCESSOR CORPORATION SUBSTITUTED.. . . . . . . . . . 50
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ARTICLE 6
DEFAULTS AND REMEDIES . . . . . . . . . . . . . . . . 50
SECTION 6.1 EVENTS OF DEFAULT.. . . . . . . . . . . . . . . . . . 50
SECTION 6.2 ACCELERATION. . . . . . . . . . . . . . . . . . . . . 52
SECTION 6.3 OTHER REMEDIES. . . . . . . . . . . . . . . . . . . . 53
SECTION 6.4 WAIVER OF PAST DEFAULTS.. . . . . . . . . . . . . . . 54
SECTION 6.5 CONTROL BY MAJORITY.. . . . . . . . . . . . . . . . . 54
SECTION 6.6 LIMITATION ON SUITS . . . . . . . . . . . . . . . . . 54
SECTION 6.7 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT . . . . 55
SECTION 6.8 COLLECTION SUIT BY TRUSTEE. . . . . . . . . . . . . . 55
SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM. . . . . . . . . . . 55
SECTION 6.10 PRIORITIES. . . . . . . . . . . . . . . . . . . . . . 56
SECTION 6.11 UNDERTAKING FOR COSTS.. . . . . . . . . . . . . . . . 57
ARTICLE 7
TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 7.1 DUTIES OF TRUSTEE.. . . . . . . . . . . . . . . . . . 57
SECTION 7.2 RIGHTS OF TRUSTEE.. . . . . . . . . . . . . . . . . . 58
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE. . . . . . . . . . . . . 59
SECTION 7.4 TRUSTEE'S DISCLAIMER. . . . . . . . . . . . . . . . . 60
SECTION 7.5 NOTICE OF DEFAULTS. . . . . . . . . . . . . . . . . . 60
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES. . . . . . 60
SECTION 7.7 COMPENSATION AND INDEMNITY. . . . . . . . . . . . . . 61
SECTION 7.8 REPLACEMENT OF TRUSTEE. . . . . . . . . . . . . . . . 61
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC. . . . . . . . . . . 63
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.. . . . . . . . . . . . 63
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.. . 63
ARTICLE 8
DEFEASANCE AND COVENANT DEFEASANCE. . . . . . . . . . 63
SECTION 8.1 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT
DEFEASANCE . . . . . . . . . . . . . . . . . . . . . 64
SECTION 8.2 LEGAL DEFEASANCE AND DISCHARGE. . . . . . . . . . . . 64
SECTION 8.3 COVENANT DEFEASANCE.. . . . . . . . . . . . . . . . . 64
SECTION 8.4 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE. . . . . . 65
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SECTION 8.5 DEPOSITED MONEY AND GOVERNMENT NOTES TO BE HELD IN
TRUST; OTHER MISCELLANEOUS PROVISIONS. . . . . . . . 66
SECTION 8.6 REPAYMENT TO COMPANY. . . . . . . . . . . . . . . . . 67
SECTION 8.7 REINSTATEMENT.. . . . . . . . . . . . . . . . . . . . 67
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER. . . . . . . . . . . 68
SECTION 9.3 COMPLIANCE WITH TRUST INDENTURE ACT.. . . . . . . . . 69
SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS.. . . . . . . . . . 70
SECTION 9.5 NOTATION ON OR EXCHANGE OF NOTES. . . . . . . . . . . 70
SECTION 9.6 TRUSTEE TO SIGN AMENDMENTS, ETC.. . . . . . . . . . . 70
SECTION 9.7 PAYMENTS FOR CONSENTS.. . . . . . . . . . . . . . . . 71
ARTICLE 10
[INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 71
ARTICLE 11
[INTENTIONALLY OMITTED] . . . . . . . . . . . . . . . 71
ARTICLE 12
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . 72
SECTION 12.1 TRUST INDENTURE ACT CONTROLS. . . . . . . . . . . . . 72
SECTION 12.2 NOTICES.. . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 12.3 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER
HOLDERS OF NOTES.. . . . . . . . . . . . . . . . . . 73
SECTION 12.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT. . 73
SECTION 12.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.. . . . 73
SECTION 12.6 RULES BY TRUSTEE AND AGENTS.. . . . . . . . . . . . . 74
SECTION 12.7 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS,
EMPLOYEES, INCORPORATORS AND STOCKHOLDERS. . . . . . 74
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SECTION 12.8 GOVERNING LAW.. . . . . . . . . . . . . . . . . . . . 74
SECTION 12.9 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS . . . . 75
SECTION 12.10 SUCCESSORS. . . . . . . . . . . . . . . . . . . . . . 75
SECTION 12.11 SEVERABILITY. . . . . . . . . . . . . . . . . . . . . 75
SECTION 12.12 COUNTERPART ORIGINALS . . . . . . . . . . . . . . . . 75
SECTION 12.13 TABLE OF CONTENTS, HEADINGS, ETC. . . . . . . . . . . 75
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS.
"ACCOUNTS RECEIVABLE SUBSIDIARY" means one Unrestricted Subsidiary of DBS
Corp or any subsidiary specifically designated as an Accounts Receivable
Subsidiary for the purpose of financing the accounts receivable of DBS Corp
or its Subsidiaries, and provided that any such designation shall not be
deemed to prohibit DBS Corp or its Subsidiaries from financing accounts
receivable through any other entity, including without limitation, any other
Unrestricted Subsidiary.
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"ACCOUNTS RECEIVABLE SUBSIDIARY NOTES" means the notes to be issued by the
Accounts Receivable Subsidiary for the purchase of accounts receivable.
"ACQUIRED DEBT" means, with respect to any specified Person, Indebtedness
of any other Person existing at the time such other Person merges with or into
or becomes a Subsidiary of such specified Person, or Indebtedness incurred by
such Person in connection with the acquisition of assets, including Indebtedness
incurred in connection with, or in contemplation of, such other Person merging
with or into or becoming a Subsidiary of such specified Person or the
acquisition of such assets, as the case may be.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; PROVIDED, HOWEVER,
that beneficial ownership of 10% or more of the voting securities of a Person
shall be deemed to be control; PROVIDED FURTHER that no individual, other than a
director of the Company or an officer of the Company with a policy making
function, shall be deemed an Affiliate of the Company or any of its
Subsidiaries, solely by reason of such individual's employment, position or
responsibilities by or with respect to the Company or any of its Subsidiaries.
"AGENT" means any Registrar, Paying Agent or co-registrar.
"BANK DEBT" means Indebtedness incurred pursuant to the Credit Agreement in
an aggregate amount not to exceed the sum of (i) 90% of the accounts receivable
of the borrowers under the Credit Agreement eligible for inclusion in the
borrowing base under the Credit Agreement, plus (ii) 75% of the inventory of the
Credit Agreement Borrowers under the Credit Agreement eligible for inclusion in
the borrowing base under the Credit Agreement, plus (iii) 100% of the cash
collateral and marketable securities of the borrowers under the Credit Agreement
eligible for inclusion in the borrowing base under the Credit Agreement.
"BANKRUPTCY LAW" means title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"BUSINESS DAY" means any day other than a Legal Holiday.
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"CAPITAL LEASE" means, at the time any determination thereof is made, any
lease of property, real or personal, in respect of which the present value of
the minimum rental commitment would be capitalized on a balance sheet of the
lessee in accordance with GAAP.
"CAPITAL LEASE OBLIGATION" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a Capital Lease that would
at such time be so required to be capitalized on the balance sheet in accordance
with GAAP.
"CAPITAL STOCK" means any and all shares, interests, participations, rights
or other equivalents (however designated) of corporate stock or partnership or
membership interests, whether common or preferred.
"CASH EQUIVALENTS" means: (a) U.S. dollars; (b) securities issued or
directly and fully guaranteed or insured by the U.S. government or any agency or
instrumentality thereof having maturities of not more than six months from the
date of acquisition; (c) certificates of deposit and eurodollar time deposits
with maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case with any domestic commercial bank having capital and
surplus in excess of $500 million; (d) repurchase obligations with a term of not
more than seven days for underlying securities of the types described in clauses
(b) and (c) entered into with any financial institution meeting the
qualifications specified in clause (c) above; and (e) commercial paper rated
P-1, A-l or the equivalent thereof by Xxxxx'x Investors Service, Inc. or
Standard & Poor's Ratings Group, respectively, and in each case maturing within
six months after the date of acquisition.
"CHANGE OF CONTROL" means: (a) any transaction or series of transactions
(including, without limitation, a tender offer, merger or consolidation) the
result of which is that the Principals and their Related Parties or an entity
controlled by the Principals and their Related Parties cease to (i) be the
"beneficial owners" (as defined in Rule 13d-3 under the Exchange Act) of at
least 30% of the total Equity Interests in EchoStar and (ii) have the voting
power to elect at least a majority of the Board of Directors of EchoStar; (b)
the first day on which a majority of the members of the Board of Directors of
EchoStar are not Continuing Directors; (c) any transaction or series of
transactions (including, without limitation, a tender offer, merger or
consolidation) the result of which is that the Principals and their Related
Parties or any entity controlled by the Principals and their Related Parties
cease to be the "beneficial owners" (as defined in Rule 13d-3 under the Exchange
Act) of at least 30% of the total Equity Interests in DBS Corp and have the
voting power to elect at least a majority of the Board of Directors of DBS Corp,
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or (d) the first day on which a majority of the members of the Board of
Directors of DBS Corp are not Continuing Directors.
"COMMUNICATIONS ACT" means the Communications Act of 1934, as amended.
"COMPANY" has the meaning found in the preamble.
"CONSOLIDATED CASH FLOW" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period, plus, to the extent
deducted in computing Consolidated Net Income: (a) provision for taxes based on
income or profits; (b) Consolidated Interest Expense; (c) depreciation and
amortization (including amortization of goodwill and other intangibles) of such
Person for such period; and (d) any extraordinary loss and any net loss realized
in connection with any Asset Sale, in each case, on a consolidated basis
determined in accordance with GAAP, provided that Consolidated Cash Flow shall
not include interest income derived from the net proceeds of the offering of the
1997 Notes.
"CONSOLIDATED INTEREST EXPENSE" means, with respect to any Person for any
period, consolidated interest expense of such Person for such period, whether
paid or accrued (including amortization of original issue discount and deferred
financing costs, non-cash interest payments and the interest component of
Capital Lease Obligations), on a consolidated basis determined in accordance
with GAAP.
"CONSOLIDATED NET INCOME" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Subsidiaries for such
period, on a consolidated basis, determined in accordance with GAAP; PROVIDED,
HOWEVER, that: (a) the Net Income of any Person that is not a Subsidiary or
that is accounted for by the equity method of accounting shall be included only
to the extent of the amount of dividends or distributions paid in cash to such
Person, in the case of a gain, or to the extent of any contributions or other
payments by the referent Person, in the case of a loss; (b) the Net Income of
any Person that is a Subsidiary that is not a Wholly Owned Subsidiary shall be
included only to the extent of the amount of dividends or distributions paid in
cash to the referent Person; (c) the Net Income of any Person acquired in a
pooling of interests transaction for any period prior to the date of such
acquisition shall be excluded; (d) the Net Income of any Subsidiary of such
Person shall be excluded to the extent that the declaration or payment of
dividends or similar distributions is not at the time permitted by operation of
the terms of its charter or bylaws or any other agreement, instrument, judgment,
decree, order, statute, rule or government regulation to which it is subject;
and (e) the cumulative effect of a change in accounting principles shall be
excluded.
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"CONSOLIDATED NET WORTH" means, with respect to any Person, the sum of:
(a) the stockholders' equity of such Person; plus (b) the amount reported on
such Person's most recent balance sheet with respect to any series of preferred
stock (other than Disqualified Stock) that by its terms is not entitled to the
payment of dividends unless such dividends may be declared and paid only out of
net earnings in respect of the year of such declaration and payment, but only to
the extent of any cash received by such Person upon issuance of such preferred
stock, less: (i) all write-ups (other than write-ups resulting from foreign
currency translations and write-ups of tangible assets of a going concern
business made within 12 months after the acquisition of such business)
subsequent to the date of this Indenture in the book value of any asset owned by
such Person or a consolidated Subsidiary of such Person; and (ii) all
unamortized debt discount and expense and unamortized deferred charges, all of
the foregoing determined in accordance with GAAP.
"CONTINUING DIRECTOR" means, as of any date of determination, any member of
the Board of Directors of DBS Corp or the Company, as the case may be, who: (a)
was a member of such Board of Directors on the effective date of the Indenture;
or (b) was nominated for election or elected to such Board of Directors with the
affirmative vote of a majority of the Continuing Directors who were members of
such Board at the time of such nomination or election.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the address of the
Trustee specified in Section 12.2 or such other address as to which the Trustee
may give notice to the Company.
"CREDIT AGREEMENT" means any one or more credit agreements (which may
include or consist of revolving credits) between EchoStar, DBS Corp or any of
DBS Corp Restricted Subsidiaries and one or more banks or other financial
institutions providing financing for the business of EchoStar, DBS Corp and DBS
Corp's Restricted Subsidiaries, PROVIDED that the lenders party to the Credit
Agreement may not be Affiliates of EchoStar.
"CREDIT AGREEMENT BORROWERS" means Echo Acceptance Corporation, Echosphere
Corporation, EchoStar International Corporation, Houston Tracker Systems, Inc.,
Satellite Source, Inc., EchoStar Satellite Corporation and DNCC.
"CUSTODIAN" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"DBS" means direct broadcast satellite.
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"DBS Corp" means EchoStar DBS Corporation, a Colorado corporation.
"DEFAULT" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
"DEFERRED PAYMENTS" means Indebtedness to satellite contractors incurred in
connection with the construction and launch of EchoStar I, EchoStar II, EchoStar
III and EchoStar IV in an amount not to exceed $135.0 million.
"DISH" means Dish, Ltd., a Nevada corporation.
"DISQUALIFIED STOCK" means any Capital Stock which, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to July 1,
2004.
"DNCC" means Dish Network Credit Corporation, a Colorado corporation.
"ECHOSTAR" has the meaning found in the preamble.
"ECHOSTAR DBS SYSTEM" means the digital direct broadcast satellite system
of the Company.
"ECHOSTAR I" means Dish's high-powered direct broadcast satellite
designated as EchoStar I.
"ECHOSTAR II" means Dish's high-powered direct broadcast satellite
designated as EchoStar II.
"ECHOSTAR III" means the high-powered direct broadcast satellite being
constructed by Direct Broadcasting Satellite Corporation as of the Issuance
Date, and any replacement satellite thereof.
"ECHOSTAR IV" means the high-powered direct broadcast satellite being
constructed by a Subsidiary of the Company, and any replacement satellite
thereof.
"ECHOSTAR RECEIVER SYSTEM" means a satellite dish, digital satellite
receiver, remote control and related components, used in connection with the DBS
service provided by EchoStar and its Subsidiaries.
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"ELIGIBLE INSTITUTION" means a commercial banking institution that has
combined capital and surplus of not less than $500 million or its equivalent in
foreign currency, whose debt is rated Investment Grade at the time as of which
any investment or rollover therein is made.
"EQUITY INTERESTS" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"ESBC" means EchoStar Satellite Broadcasting Corporation.
"ESC" means EchoStar Satellite Corporation.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXISTING INDEBTEDNESS" means the Notes and any other Indebtedness of the
Company and its Subsidiaries in existence on the date of the Indenture if such
Indebtedness resulted from a contractual commitment outstanding on the date of
the Indenture which related to the construction, launch or insurance of any
satellite owned by, or under contract to, the Company or any of its Subsidiaries
as of the date of the Indenture, until such amounts are repaid.
"FCC" means Federal Communications Commission.
"Full-CONUS Orbital Slot" means the 101, 110 or 119 degrees West Longitude
orbital shot.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the U.S., which are applicable as of the date of determination;
PROVIDED, HOWEVER; that these definitions and all ratios and calculations
contained in Sections 4.7, 4.8, 4.9 and 4.10 shall be determined in accordance
with GAAP as in effect and applied by EchoStar and its Subsidiaries on the date
of the Indenture, consistently applied; PROVIDED, FURTHER, that in the event of
any change in GAAP or in any change by EchoStar or any of its Subsidiaries in
GAAP applied that would result in any change in any such ratio or calculation,
the Company shall deliver to the Trustee, each time any such ratio or
calculation is required
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to be determined or made, an Officers' Certificate setting forth the
computations showing the effect of such change or application on such ratio or
calculation.
"GLOBAL NOTE" means a Note evidencing all or part of the Notes issued to
the Depository for such Notes.
"GOVERNMENT SECURITIES" means direct 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.
"GUARANTEE" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"GUARANTOR" means any entity that executes a Guarantee of the obligations
of the Company under the Senior Exchange Notes, and their respective successors
and assigns.
"HEDGING OBLIGATIONS" means, with respect to any Person, the obligations of
such Person under: (a) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements; and (b) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates.
"HOLDER" means a Person in whose name a Note is registered.
"INDEBTEDNESS" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced by
bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or representing the balance
deferred and unpaid of the purchase price of any property (including pursuant to
capital leases) or representing any Hedging Obligations, except any such balance
that constitutes an accrued expense or trade payable, if and to the extent any
of the foregoing (other than Hedging Obligations) would appear as a liability
upon a balance sheet of such Person prepared in accordance with GAAP, and also
includes, to the extent not otherwise included, the Guarantee of items that
would be included within this definition.
"INDEBTEDNESS TO CASH FLOW RATIO" means, with respect to any Person, the
ratio of: (a) the Indebtedness of such Person and its Subsidiaries as of the
end of the most recently ended fiscal quarter, plus the amount of any
Indebtedness
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incurred subsequent to the end of such fiscal quarter; to (b) such Person's
Consolidated Cash Flow for the most recently ended four full fiscal quarters
for which internal financial statements are available immediately preceding
the date on which such event for which such calculation is being made shall
occur (the "Measurement Period"), PROVIDED, HOWEVER; that: (i) in making such
computation, Indebtedness shall include the total amount of funds outstanding
and available under any revolving credit facilities; and (ii) in the event
that DBS Corp or any of its Subsidiaries consummates a material acquisition or
an Asset Sale or other disposition of assets subsequent to the commencement of
the Measurement Period but prior to the event for which the calculation of the
Indebtedness to Cash Flow Ratio is made, then the Indebtedness to Cash Flow
Ratio shall be calculated giving pro forma effect to such material acquisition
or Asset Sale or other disposition of assets, as if the same had occurred at
the beginning of the applicable period.
"INDENTURE" means this Indenture, as amended or supplemented from time to
time.
"INDEPENDENT SUBSIDIARY" means any Subsidiary of the Company which (i)
maintains separate books and records from the Company and observes all corporate
formalities, (ii) pays all of its liabilities out of its own funds, (iii) in all
dealings with the public identifies itself under its own name and as a separate
and distinct entity, (iv) does not commingle its assets with those of any other
Person, and (v) includes at least one independent member on its board of
directors.
"INVESTMENT GRADE" means with respect to a security, that such security is
rated, by at least two nationally recognized statistical rating organizations,
in one of each such organization's four highest generic rating categories.
"INVESTMENTS" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of loans (including
Guarantees), advances or capital contributions (excluding commission, travel and
similar advances to officers and employees made in the ordinary course of
business), purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities and all other items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
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"MARKETABLE SECURITIES" means: (a) Government Securities; (b) any
certificate of deposit maturing not more than 365 days after the date of
acquisition issued by, or time deposit of, an Eligible Institution; (c)
commercial paper maturing not more than 365 days after the date of acquisition
issued by a corporation (other than an Affiliate of the Company) with an
Investment Grade rating, at the time as of which any investment therein is made,
issued or offered by an Eligible Institution; (d) any bankers acceptances or
money market deposit accounts issued or offered by an Eligible Institution; and
(e) any fund investing exclusively in investments of the types described in
clauses (a) through (d) above.
"NET INCOME" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP, excluding, however, any gain
(but not loss), together with any related provision for taxes on such gain (but
not loss), realized in connection with any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions), and
excluding any extraordinary gain (but not loss), together with any related
provision for taxes on such extraordinary gain (but not loss).
"NET PROCEEDS" means the aggregate cash proceeds received by the Company,
DBS Corp or any of its Restricted Subsidiaries, as the case may be, in respect
of any Asset Sale, net of the direct costs relating to such Asset Sale
(including, without limitation, legal, accounting and investment banking fees,
and sales commissions) and any relocation expenses incurred, as a result
thereof, taxes paid or payable as a result thereof (after taking into account
any available tax credits or deductions and any tax sharing arrangements),
amounts required to be applied to the repayment of Indebtedness secured by a
Lien on the asset or assets that are the subject of such Asset Sale and any
reserve for adjustment in respect of the sale price of such asset or assets. Net
Proceeds shall exclude any non-cash proceeds received from any Asset Sale, but
shall include such proceeds when and as converted by DBS Corp or any Restricted
Subsidiary of DBS Corp to cash.
"1994 NOTES INDENTURE" means the Indenture relating to the 1994 Notes.
"1994 NOTES" means the 12 7/8% Senior Discount Notes due 2004 of Dish.
"1994 CREDIT AGREEMENT" has the meaning set forth in the 1996 Notes
Indenture.
"1996 NOTES INDENTURE" means the Indenture relating to the 1996 Notes.
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"1996 NOTES" means the 13 1/8% Senior Discount Notes due 2004 of ESBC.
"1997 NOTES INDENTURE" means the Indenture relating to the 1997 Notes.
"1997 NOTES" means the 12 1/2% Senior Secured Notes due 2002 of DBS Corp.
"NON-RECOURSE INDEBTEDNESS" of any Person means Indebtedness of such
Person that: (i) is not guaranteed by any other Person (except a Wholly Owned
Subsidiary of the referent Person); (ii) is not recourse to and does not
obligate any other Person (except a Wholly Owned Subsidiary of the referent
Person) in any way; (iii) does not subject any property or assets of any
other Person (except a Wholly Owned Subsidiary of the referent Person),
directly or indirectly, contingently or otherwise, to the satisfaction
thereof; and (iv) is not required by GAAP to be reflected on the financial
statements of any other Person (other than a Subsidiary of the referent
Person) prepared in accordance with GAAP.
"NOTES" means the Senior Exchange Notes.
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"OFFERING MEMORANDUM" means the Offering Memorandum dated September 26,
1997 relating to the offering of the Notes.
"OFFICER" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, Controller,
Secretary or any Vice-President of such Person.
"OFFICERS' CERTIFICATE" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, principal financial officer, treasurer or principal
accounting officer of the Company.
"OPINION OF COUNSEL" means an opinion from legal counsel, who may be an
employee of or counsel to the Company, any Subsidiary of the Company or the
Trustee.
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"ORBITAL EVENT" means the first date on which the Company and its
Subsidiaries do not have the right to use orbital slot authorizations granted
by the FCC covering a minimum of 21 transponders at a single Full-CONUS
Orbital Slot.
"PERMITTED INVESTMENTS" means: (a) Investments in DBS Corp or in a Wholly
Owned Subsidiary of DBS Corp, other than Unrestricted Subsidiaries of DBS
Corp, (b) Investments in Cash Equivalents and Marketable Securities; (c)
conversion of debentures of SSET and DBS Industries, Inc. ("DBSI"), in
accordance with their terms, into Equity Interests of SSET and DBSI; and (d)
Investments by DBS Corp or any Subsidiary of DBS Corp in a Person if, as a
result of such Investment: (i) such Person becomes a Wholly Owned Restricted
Subsidiary of DBS Corp, or (ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, DBS Corp or a Wholly Owned Subsidiary of
DBS Corp that is not an Unrestricted Subsidiary of DBS Corp.
"PERSON" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust or unincorporated organization
(including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business).
"PREFERRED EQUITY INTEREST", in any Person, means an Equity Interest of
any class or classes (however designated) which is preferred as to the
payment of dividends or distributions, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over Equity Interests of any other class in such Person.
"PRINCIPALS" means Xxxxxxx X. Xxxxx, Xxxxx XxXxxxxx, X. Xxxxx Xxxxxx,
Xxxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxxxx.
"PURCHASE MONEY INDEBTEDNESS" means indebtedness of the Company or any of
its Bound Subsidiaries, DBS Corp or any Restricted Subsidiaries of DBS Corp
incurred (within 180 days of such purchase) to finance the purchase of any
assets of the Company or Bound Subsidiary, DBS Corp or any Restricted
Subsidiary of DBS Corp: (a) to the extent the amount of Indebtedness
thereunder does not exceed 80% of the purchase cost of such assets; (b) to
the extent the purchase cost of such assets is or should be included in
"additions to property, plant and equipment" in accordance with GAAP; (c) to
the extent that such Indebtedness is not recourse to the Company or any Bound
Subsidiary, DBS Corp or any of its Restricted Subsidiaries or any of their
respective assets, other than the assets so purchased; and (d) if the
purchase of such assets is not part of an acquisition of any Person.
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"RECEIVER SUBSIDY" means a subsidy, rebate or other similar payment by
EchoStar or any of its Subsidiaries, in the ordinary course of business, to
subscribers, vendors or distributors, relating to an EchoStar Receiver
System, not to exceed the cost of such EchoStar Receiver System, together
with the cost of installation of such EchoStar Receiver System.
"RECEIVABLES TRUST" means a trust organized solely for the purpose of
securitizing the accounts receivable held by the Accounts Receivable
Subsidiary that (a) shall not engage in any business other than (i) the
purchase of accounts receivable or participation interests therein from the
Accounts Receivable Subsidiary and the servicing thereof, (ii) the issuance
of and distribution of payments with respect to the securities permitted to
be issued under clause (b) below and (iii) other activities incidental to the
foregoing, (b) shall not at any time incur Indebtedness or issue any
securities, except (i) certificates representing undivided interests in the
Trust issued to the Accounts Receivable Subsidiary and (ii) debt securities
issued in an arm's length transaction for consideration solely in the form of
cash and Cash Equivalents, all of which (net of any issuance fees and
expenses) shall promptly be paid to the Accounts Receivable Subsidiary, and
(c) shall distribute to the Accounts Receivable Subsidiary as a distribution
on the Accounts Receivable Subsidiary's beneficial interest in the
Receivables Trust no less frequently than once every six months all available
cash and Cash Equivalents held by it, to the extent not required for
reasonable operating expenses or reserves therefor or to service any
securities issued pursuant to clause (b) above that are not held by the
Accounts Receivable Subsidiary.
"RELATED PARTY" means, with respect to any Principal, (a) the spouse and
each immediate family member of such Principal and (b) each trust,
corporation, partnership or other entity of which such Principal beneficially
holds an 80% or more controlling interest.
"RESPONSIBLE OFFICER," when used with respect to the Trustee, means any
Officer within the corporate trust administration of the Trustee (or any
successor group of the Trustee) or any other Officer of the Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"RESTRICTED INVESTMENT" means an Investment other than Permitted
Investments.
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"RESTRICTED SUBSIDIARY" means, any corporation, association or other
business entity of which more than 50% of the total voting power of shares of
Capital Stock entitled (without regard to the occurrence of any contingency)
to vote in the election of directors, managers or trustees thereof is at the
time owned or controlled, directly or indirectly, by DBS Corp or one or more
Subsidiaries of DBS Corp or a combination thereof, other than Unrestricted
Subsidiaries.
"SATELLITE RECEIVER" means any satellite receiver capable of receiving
programming from the EchoStar's DISH Network.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X
promulgated pursuant to the Securities Act, as such Regulation is in effect
on the date of this Indenture.
"SSET" means Satellite Systems Engineering Technologies, Inc. and its
Affiliates.
"SUBSIDIARY" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total
voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of such
Person or a combination thereof.
"SUPPLEMENTAL INDENTURE" means any supplemental indenture relating to
this Indenture.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date on
which this Indenture is qualified under the TIA.
"TRUSTEE" means the party named as such above until a successor replaces
it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"TT&C" means telemetry, tracking and control.
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"UNRESTRICTED SUBSIDIARY" means; (A) EchoStar Real Estate Corporation,
EchoStar Real Estate Corporation II, EchoStar International (Mauritius) Ltd.,
EchoStar Manufacturing and Distribution Pvt. Ltd. and Satrec Mauritius Ltd.;
and (B) any Subsidiary of DBS Corp designated as an Unrestricted Subsidiary
in a resolution of the Board of Directors of DBS Corp: (a) no portion of the
Indebtedness or any other obligation (contingent or otherwise) of which, at
the time of such designation: (i) is guaranteed by DBS Corp or any other
Subsidiary of DBS Corp (other than another Unrestricted Subsidiary); (ii) is
recourse to or obligates DBS Corp or any other Subsidiary of DBS Corp (other
than another Unrestricted Subsidiary) in any way; or (iii) subjects any
property or asset of DBS Corp or any other Subsidiary of DBS Corp (other than
another Unrestricted Subsidiary), directly or indirectly, contingently or
otherwise, to satisfaction thereof; (b) with which neither DBS Corp nor any
other Subsidiary of DBS Corp (other than another Unrestricted Subsidiary)
has any contract, agreement, arrangement, understanding or is subject to an
obligation of any kind, written or oral, other than on terms no less
favorable to DBS Corp or such other Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of DBS Corp; (c)
with which neither DBS Corp nor any other Subsidiary of DBS Corp (other than
another Unrestricted Subsidiary) has any obligation: (i) to subscribe for
additional shares of Capital Stock or other equity interests therein; or (ii)
to maintain or preserve such Subsidiary's financial condition or to cause
such Subsidiary to achieve certain levels of operating results and (d) which
does not provide direct broadcast services in any capacity other than as a
selling, billing and collection agent for one or more of DBS Corp and its
Restricted Subsidiaries; PROVIDED, HOWEVER, that none of DBS Corp, EchoStar
Satellite Broadcasting Corporation, Dish, EchoStar Satellite Corporation,
DirectSat Corporation, Echo Acceptance Corporation, Houston Tracker Systems,
Inc., EchoStar International Corporation and Echosphere Corporation may be
designated as Unrestricted Subsidiaries. At the time that DBS Corp
designates a Subsidiary as an Unrestricted Subsidiary, DBS Corp will be
deemed to have made a Restricted Investment in an amount equal to the fair
market value (as determined in good faith by the Board of Directors of DBS
Corp evidenced by a resolution of the Board of Directors of DBS Corp and set
forth in an Officers' Certificate delivered to the Trustee; PROVIDED,
HOWEVER, that if the fair market value of such Subsidiary exceeds $10
million, the fair market value shall be determined by an investment banking
firm of national standing selected by DBS Corp) of such Subsidiary; provided
that DBS Corp may designate DNCC as an Unrestricted Subsidiary at any time
and such designation shall not be deemed a Restricted Investment if, but only
if, the provisions of clauses (B) (a), (b), (c) and (d) shall have been
complied with prior to such designation. An Unrestricted Subsidiary may be
designated as a Restricted Subsidiary of DBS Corp if, at the time of such
designation after giving pro forma effect thereto as if such designation had
occurred at the beginning of the applicable four-quarter period, DBS Corp
would be permitted to
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incur at least $1.00 of additional Indebtedness pursuant to the Cash Flow
Ratio test set forth in the covenant entitled "--Incurrence of Indebtedness,
Issuance of Disqualified Stock and Issuance of Preferred Equity Interest of
Subsidiaries."
"WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the
then outstanding principal amount of such Indebtedness into (b) the total of
the product obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment.
"WHOLLY OWNED RESTRICTED SUBSIDIARY" means a Wholly Owned Subsidiary of
DBS Corp that is a Restricted Subsidiary of DBS Corp
"WHOLLY OWNED SUBSIDIARY" means, with respect to any Person, any
Subsidiary all of the outstanding voting stock (other than directors'
qualifying shares) of which is owned by such Person, directly or indirectly.
SECTION 1.2 OTHER DEFINITIONS.
TERM DEFINED IN SECTION
"Affiliate Transaction" 4.11
"Asset Sale" 4.10
"Change of Control Offer" 4.15
"Change of Control Payment" 4.15
"Change of Control Payment Date" 4.15
"Covenant Defeasance" 8.3
"EAC" 4.7
"Event of Default" 6.1
"Excess Proceeds" 4.10; 4.16
"Incur" 4.9
"Legal Defeasance" 8.2
"Offer Amount" 3.9
"Offer Payment" 4.21
"Offer Payment Date" 4.21
"Offer Period" 3.9
"Offer to Purchase" 4.21
"Paying Agent" 2.4
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"Payment Default" 6.1
"Permitted Refinancing" 4.9
"Purchase Date" 3.9
"Refinancing Indebtedness" 4.9
"Registrar" 2.4
"Restricted Payments" 4.7
"Significant Transaction" 4.22
"Special Offer Payment" 4.22
"Special Offer Payment Date" 4.22
"Special Offer to Purchase" 4.22
"Strategic Partner" 4.22
"Subordinate and Junior" 11.1
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"INDENTURE SECURITIES" means the Notes;
"INDENTURE SECURITY HOLDER" means a Holder of a Note;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee;
"OBLIGOR" on the Notes means each of the Company and any successor
obligor upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
SECTION 1.4 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
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(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and in the plural
include the singular; and
(e) provisions apply to successive events and transactions.
ARTICLE 2
SECTION 2.1 FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto, the terms of which are
incorporated in and made a part of this Indenture. The Notes may have
notations, legends or endorsements approved as to form by the Company and
required by law, stock exchange rule, agreements to which the Company or DBS
Corp, as the case may be, are subject or usage. Each Note shall be dated the
date of its authentication. The Notes shall be issuable only in
denominations of $1,000 and integral multiples thereof.
The Notes shall be issued in the form of Global Notes and the Depository
Trust Company, its nominees, and their respective successors, shall act as
the Depository with respect thereto. Each Global Note shall (i) be
registered in the name of the Depository for such Global Note or the nominee
of such Depository, (ii) shall be delivered by the Trustee to such Depository
or pursuant to such Depository's instructions, and (iii) shall bear a legend
substantially to the following effect: Unless this certificate is presented
by an authorized representative of The Depository Trust Company, a New York
Corporation ("DTC"), to the Company or its agent for registration of
transfer, exchange, or payment, and any certificate issued is registered in
the name of Cede & Co. or in such other name as is requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such other
entity as is requested by an authorized representative of DTC), any transfer,
pledge, or other use hereof for value or otherwise by or to any Person is
wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
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Any Note not registered under the Securities Act shall bear the
following legend on the face thereof:
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
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 OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER (1)
REPRESENTS THAT IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT)(A "QIB"), (2) AGREES THAT IT WILL NOT,
WITHIN THE TIME PERIOD REFERRED TO UNDER RULE 144(k) (TAKING INTO ACCOUNT
THE PROVISIONS OF RULE 144(d) UNDER THE SECURITIES ACT, IF APPLICABLE)
UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS
NOTE, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR
ANY SUBSIDIARY THEREOF, (B) TO A PERSON WHOM THE HOLDER REASONABLY BELIEVES
IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), (D) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND (3) AGREES THAT IT
WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER
ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS."
The Trustee must refuse to register any transfer of a Note bearing such
legend that would violate the restrictions described in such legend.
SECTION 2.2 FORM OF EXECUTION AND AUTHENTICATION.
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Two Officers of the Company shall sign the Notes for the Company by
manual or facsimile signature.
If an Officer whose signature is on a Note no longer holds that office at
the time the Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature of the Trustee shall be conclusive evidence that
the Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by two
Officers of the Company, authenticate Notes for original issue up to an
aggregate principal amount of $__________ of the Notes exchanged therefor.
The aggregate principal amount of Notes outstanding at any time shall not
exceed the amount set forth herein except as PROVIDED in Section 2.7.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Notes. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as
an Agent to deal with the Company or any Affiliate of the Company
SECTION 2.3 REGISTRAR AND PAYING AGENT.
The Company shall maintain (i) an office or agency where Notes may be
presented for registration of transfer or for exchange (including any
co-registrar, the "REGISTRAR") and (ii) an office or agency where Notes may
be presented for payment ("PAYING AGENT"). The Registrar shall keep a
register of the Notes and of their transfer and exchange. The Company may
appoint one or more co-registrars and one or more additional paying agents.
The term "Paying Agent" includes any additional paying agent. The Company
may change any Paying Agent, Registrar or co-registrar without prior notice
to any Holder of a Note. The Company shall notify the Trustee and the Trustee
shall notify the Holders of the Notes of the name and address of any Paying
Agent not a party to this Indenture. The Company may act as Paying Agent,
Registrar or co-registrar. The Company shall enter into an appropriate
agency agreement with any Paying Agent not a party to this Indenture, which
shall incorporate the provisions of the TIA. The agreement shall implement
the provisions of this Indenture that relate to such Agent. The Company
shall notify the Trustee of the name and address of any such Paying Agent.
If the Company fails to maintain a Registrar or Paying Agent, or fails
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to give the foregoing notice, the Trustee shall act as such, and shall be
entitled to appropriate compensation in accordance with Section 7.7.
The Company initially appoints the Trustee as Registrar, Paying Agent and
agent for service of notices and demands in connection with the Notes.
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
the Holders of the Notes or the Trustee all money held by the Paying Agent
for the payment of principal of, premium, if any, and interest on the Notes,
and shall notify the Trustee of any Default by the Company in making any such
payment. While any such Default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time
may require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company)
shall have no further liability for the money delivered to the Trustee. If
the Company acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders of the Notes all money held by it
as Paying Agent.
SECTION 2.5 LISTS OF HOLDERS OF THE NOTES.
The Registrar 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 of the Notes and shall otherwise comply with TIA Section 312(a).
If the Trustee is not the Registrar, the Company shall furnish to the
Trustee at least seven Business Days before each interest payment date and at
such other times as the Trustee may request in writing a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Holders of the Notes, including the aggregate principal amount
of the Notes held by each thereof, and the Company shall otherwise comply
with TIA Section 312(a). The Company hereby appoints the Trustee as
Registrar and the Trustee hereby accepts such appointment.
SECTION 2.6 TRANSFER AND EXCHANGE.
When Notes are presented to the Registrar with a request to register the
transfer or to exchange them for an equal principal amount of Notes of other
denominations, the Registrar shall register the transfer or make the exchange
if its requirements for such transactions are met; PROVIDED, HOWEVER, that
any Note presented or surrendered for registration of transfer or exchange
shall be duly endorsed or accompanied by a written
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instruction of transfer in form satisfactory to the Registrar and the Trustee
(if the Trustee is not the Registrar) duly executed by the Holder thereof or
by his attorney duly authorized in writing. To permit registrations of
transfer and exchanges, the Company shall issue and the Trustee shall
authenticate Notes at the Registrar's written request, subject to such rules
as the Trustee may reasonably require.
Neither the Company nor the Registrar shall be required to (i) issue,
register the transfer of or exchange Notes during a period beginning at the
opening of business on a Business Day 15 days before the day of any selection
of Notes for redemption under Section 3.2 or (ii) 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.
No service charge shall be made to any Holder of a Note for any
registration of transfer or exchange (except as otherwise expressly permitted
herein), 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 such transfer tax or similar governmental charge payable upon
exchanges pursuant to Sections 2.10, 3.6, 3.8 or 9.5, which shall be paid by
the Company).
Prior to due presentment to the Trustee for registration of the transfer
of any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of, premium, if any,
and interest on such Note and for all other purposes whatsoever, whether or
not such Note is overdue, and neither the Trustee, any Agent nor the Company
shall be affected by notice to the contrary.
SECTION 2.7 REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee, or the Company and
the Trustee receive evidence to their satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee, upon the
written order of the Company signed by two Officers of the Company, shall
authenticate a replacement Note if the Trustee's requirements for
replacements of Notes are met. If required by the Trustee or the Company, an
indemnity bond must be supplied by the Holder that is sufficient in the
judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent or any authenticating agent from any loss which any of them may
suffer if a Note is replaced. Each of the Company and the Trustee may charge
for its expenses in replacing a Note.
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Every replacement Note is an additional obligation of the Company.
SECTION 2.8 OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for
cancellation and those described in this Section as not outstanding.
If a Note is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.1,
it ceases to be outstanding and interest on it ceases to accrue.
Subject to Section 2.9, a Note does not cease to be outstanding because
the Company, a Subsidiary of the Company or an Affiliate of the Company holds
the Note.
SECTION 2.9 TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, any Subsidiary of the Company or any Affiliate of the Company shall
be considered as though not outstanding, except that for purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes which a Responsible Officer knows to
be so owned shall be so considered. Notwithstanding the foregoing, Notes
that are to be acquired by the Company, any Subsidiary of the Company or an
Affiliate of the Company pursuant to an exchange offer, tender offer or other
agreement shall not be deemed to be owned by the Company, a Subsidiary of the
Company or an Affiliate of the Company until legal title to such Notes passes
to the Company, such Subsidiary or such Affiliate, as the case may be.
SECTION 2.10 TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may prepare
and the Trustee, upon written order of the Company signed by two Officers of
the Company, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that
the Company and the Trustee consider appropriate for temporary Notes.
Without unreasonable delay, the Company shall prepare and the Trustee, upon
receipt of the written order of the Company signed by two
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Officers of the Company, shall authenticate definitive Notes in exchange for
temporary Notes. Until such exchange, temporary Notes shall be entitled to
the same rights, benefits and privileges as definitive Notes.
SECTION 2.11 CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee shall cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall destroy canceled
Notes (subject to the record retention requirement of the Exchange Act),
unless the Company directs canceled Notes to be returned to it. The Company
may not issue new Notes to replace Notes that it has redeemed or paid or that
have been delivered to the Trustee for cancellation. All canceled Notes
held by the Trustee shall be destroyed and certification of their destruction
delivered to the Company, unless by a written order, signed by two Officers
of the Company, the Company shall direct that canceled Notes be returned to
it.
SECTION 2.12 DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders of
the Notes on a subsequent special record date, which date shall be at the
earliest practicable date but in all events at least five Business Days prior
to the payment date, in each case at the rate PROVIDED in the Notes. The
Company shall, with the consent of the Trustee, fix or cause to be fixed each
such special record date and payment date. At least 15 days before the
special record date, the Company (or the Trustee, in the name of and at the
expense of the Company) shall mail to Holders of the Notes a notice that
states the special record date, the related payment date and the amount of
such interest to be paid.
SECTION 2.13 RECORD DATE.
The record date for purposes of determining the identity of Holders of
the Notes entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as PROVIDED
for in TIA Section 316(c).
SECTION 2.14 CUSIP NUMBER.
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The Company in issuing the Notes may use a "CUSIP" number and, if it
does so, the Trustee shall use the CUSIP number in notices of redemption or
exchange as a convenience to Holders; PROVIDED that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes and that reliance may be placed
only on the other identification numbers printed on the Notes. The Company
will promptly notify the Trustee of any change in the CUSIP number.
ARTICLE 3
REDEMPTION
SECTION 3.1 NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.7, it shall furnish to the Trustee, at least 30 days
(unless a shorter period is acceptable to the Trustee) but not more than 60
days before a redemption date, an Officers' Certificate setting forth (i) the
redemption date, (ii) the principal amount of Notes to be redeemed and (iii)
the redemption price.
SECTION 3.2 SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
selection of Notes for redemption will be made by the Trustee in compliance
with the requirements of the principal national securities exchange, if any,
on which the Notes are listed, or if the Notes are not so listed on a PRO
RATA basis, by lot or in accordance with any other method the Trustee
considers fair and appropriate, PROVIDED that no Notes with a principal
amount of $1,000 or less shall be redeemed in part. In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected,
unless otherwise PROVIDED herein, not less than 30 nor more than 60 days
prior to the redemption date by the Trustee from the outstanding Notes not
previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions
of them selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed.
SECTION 3.3 NOTICE OF REDEMPTION.
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At least 30 days but not more than 60 days before a redemption date, the
Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part only, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; PROVIDED, HOWEVER, that
the Company shall have delivered to the Trustee, at least 30 days (unless a
shorter period is acceptable to the Trustee) prior to the redemption date, an
Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as PROVIDED in the
preceding paragraph.
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION.
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Once notice of redemption is mailed in accordance with Section 3.3, Notes
called for redemption become due and payable on the redemption date at the
redemption price.
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE.
On or prior to any redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price
of and accrued interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of
the amounts necessary to pay the redemption price of, and accrued interest
on, all Notes to be redeemed.
On and after the redemption date, interest shall cease to accrue on the
Notes or the portions of Notes called for redemption. If a Note is redeemed
on or after an interest record date but on or prior to the related interest
payment date, then any accrued and unpaid interest shall be paid to the
Person in whose name such Note was registered at the close of business on
such record date. If any Note called for redemption shall not be so paid
upon surrender for redemption because of the failure of the Company to comply
with the preceding paragraph, interest shall be paid on the unpaid
principal, from the redemption date until such principal is paid, and to the
extent lawful on any interest not paid on such unpaid principal, in each
case at the rate PROVIDED in the Notes.
SECTION 3.6 NOTES REDEEMED IN PART.
(a) Upon surrender and cancellation of a Note that is redeemed in part,
the Company shall issue and the Trustee shall authenticate for the Holder of
the Notes at the expense of the Company a new Note equal in principal amount
to the unredeemed portion of the Note surrendered.
(b) If pursuant to any repurchase or redemption obligation contained in
this Indenture, fewer than all the Notes represented by any certificate are
to be redeemed, a new certificate shall be issued representing the unredeemed
Notes without costs to the Holder, together with the amount of cash, if any,
in lieu of Notes representing any remaining fractionof $1,000 to the extent
the Company is legally and contractually entitled to pay cash for said
fractional Notes. If the Company is not entitled to pay cash for fractional
shares, it shall pay cash to the Holder for the fractional Notes when it
becomes legally and contractually able to pay such cash.
SECTION 3.7 OPTIONAL REDEMPTION.
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Except as PROVIDED in the next paragraph, the Company shall not have the
option to redeem the Notes in cash, in whole or in part, prior to July 1,
2000. Thereafter, the Company shall have the option to redeem the Notes, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at
the redemption prices (expressed as percentages of principal amount) set
forth below, together with accrued and unpaid interest thereon to the
applicable redemption date, if redeemed during the 12-month period beginning
on July 1 of the years indicated below:
YEAR PERCENTAGE
2000 106.0625%
2001 104.0417%
2002 102.0208%
Thereafter 100.0000%
Notwithstanding the foregoing, at any time prior to July 1, 2000, the
Company may redeem Notes at a redemption price payable in cash equal to
112.125% of the principal amount thereof on the repurchase date plus an
amount equal to accrued and unpaid interest thereon to the repurchase date
with the net proceeds of one public or private sale of Equity Interests
(other than Disqualified Stock) of the Company or any of its Subsidiaries
(other than proceeds from a sale to the Company or any of its Subsidiaries;
PROVIDED that (a) at least two-thirds in aggregate principal amount of the
Notes originally issued remain outstanding immediately after the occurrence
of such redemption and (b) such redemption occurs within 120 days of the date
of the closing of any such sale.
SECTION 3.8 MANDATORY REDEMPTION.
The Notes will not be subject to any mandatory redemption or sinking fund
provisions. The Notes will be payable in full, with all accrued but unpaid
interest, July 1, 2004.
ARTICLE 4
COVENANTS
SECTION 4.1 PAYMENT OF NOTES.
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The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on the Notes on the dates and in the manner PROVIDED in the
Notes.
The Notes will mature on July 1, 2004. Notes will accrue interest at
12 1/8% per annum from the Exchange Date or from the most recent interest
payment date to which interest has been paid or duly provided for. Interest
will be payable semiannually on April 1, and October 1 of each year beginning
of the first such date to occur after the Exchange Date, to the holders of
record on the immediately preceding March 15 and September 15, respectively.
Interest on the Notes may, at the option of the Company, be paid in cash or
by issuing additional Notes in a aggregate principal amount equal to the
amount of such interest. Interest on overdue principal and (to the extent
permitted by law) on overdue installments of interest will accrue at a rate
equal to the rate borne by the Notes. Interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months.
The Notes will be payable both as to principal and interest at the office
or agency of the Company maintained for such purpose or, at the option of the
Company, payment of interest may be made by check mailed to the holders of
the Company Notes at their respective addresses set forth in the register of
holders of Notes. Until otherwise designated by the Company, the Company's
office or agency will be the office of the Trustee maintained for such
purpose. Principal, premium, if any, and interest shall be considered paid on
the date due if the Paying Agent, if other than the Company, holds as of
10:00 a.m. Eastern Time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, and interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal
to the then applicable interest rate on the Notes to the extent lawful; it
shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest (without regard to
any applicable grace period) at the same rate to the extent lawful.
SECTION 4.2 MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain an office or agency (which may be an office
of the Trustee or an affiliate of the Trustee, Registrar or co-registrar)
where Notes may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company shall give prompt written notice
to the Trustee of the location, and any change
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in the location, of such office or agency. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish
the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of
the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
PROVIDED, HOWEVER, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency 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 designates the Corporate Trust Office of the Trustee
as one such office or agency of the Company in accordance with Section 2.3.
SECTION 4.3 REPORTS.
Whether or not required by the rules and regulations of the SEC, so
long as any of the Notes remain outstanding, the Company shall cause copies
of all quarterly and annual financial reports and of the information,
documents, and other reports (or copies of such portions of any of the
foregoing as the SEC may by rules and regulations prescribe) which the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of
the Exchange Act (including all information that would be required to be
contained in Forms 10-Q and 10-K) to be filed with the SEC and the Trustee
and mailed to the Holders at their addresses appearing in the register of
Notes maintained by the Registrar, in each case, within 15 days of filing
with the SEC. If the Company is not subject to the requirements of such
Section 13 or 15(d) of the Exchange Act, the Company shall nevertheless
continue to cause the annual and quarterly financial statements, including
any notes thereto (and, with respect to annual reports, an auditors' report
by an accounting firm of established national reputation) and a "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
comparable to that which would have been required to appear in annual or
quarterly reports filed under Section 13 or 15(d) of the Exchange Act
(including all information that would be required to be contained in Forms
10-Q and 10-K), to be so filed with the SEC for public availability and the
Trustee and mailed to the Holders within 120 days after the end of the
Company's fiscal years and within 60 days after the end of each of the first
three quarters of each such fiscal year. The Company shall also comply with
the provisions of TIA Section 314(a).
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(a) The Company shall provide the Trustee with a sufficient number
of copies of all reports and other documents and information that the Trustee
may be required to deliver to the Holders of the Notes under this Section
4.3.
SECTION 4.4 COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 120 days after
the end of each fiscal year, an Officers' Certificate stating that a review
of the activities of the Company, DBS Corp and their Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether each has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best
of his or her knowledge each entity has kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions and
conditions of this Indenture, including, without limitation, a default in the
performance or breach of Section 4.7, Section 4.9, Section 4.10, Section
4.15 or Section 4.20 (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or
she may have knowledge and what action each is taking or proposes to take
with respect thereto) and that to the best of his or her knowledge no event
has occurred and remains in existence by reason of which payments on account
of the principal of or interest, if any, on the Notes is prohibited or if
such event has occurred, a description of the event and what action each is
taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end
financial statements delivered pursuant to Section 4.3 above shall be
accompanied by a written statement of DBS Corp's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial
statements, nothing has come to their attention which would lead them to
believe that DBS Corp or any of its Affiliates has violated any provisions of
Article Four or Article Five of this Indenture or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly
to any Person for any failure to obtain knowledge of any such violation. The
Trustee has no duty to review these statements or any other financial
statements for purposes of determining compliance with this or any other
provision of this Indenture.
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(c) The Company shall, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of (i) any
Default or Event of Default, or (ii) any default under any Indebtedness
referred to in Section 6.1(g) or (h), an Officers' Certificate specifying
such Default, Event of Default or default and what action the Company or any
of its Affiliates is taking or proposes to take with respect thereto.
SECTION 4.5 TAXES.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental
levies except as contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material
respect to the Holders of the Notes.
SECTION 4.6 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this Indenture; and the Company (to the
extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted
to the Trustee, but shall suffer and permit the execution of every such power
as though no such law has been enacted.
SECTION 4.7 RESTRICTED PAYMENTS.
DBS Corp shall not, and shall not permit any of its Restricted
Subsidiaries, to, directly or indirectly, (a) declare or pay any dividend or
make any distribution on account of any Equity Interests of DBS Corp or any
of its Subsidiaries, other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of DBS Corp or dividends or
distributions payable to DBS Corp or any Wholly Owned Subsidiary of DBS Corp
(other than Unrestricted Subsidiaries of DBS Corp), (b) purchase, redeem or
otherwise acquire or retire for value any outstanding Equity Interests of DBS
Corp, any of its Subsidiaries or any other Affiliate of DBS Corp, other than
any such Equity Interests owned by DBS Corp or any of its Wholly Owned
Subsidiaries (other than Unrestricted Subsidiaries of DBS Corp), or (c) make
any Restricted Investment (all such prohibited payments and other actions set
forth in clauses
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(a) through (c) above being collectively referred to as "RESTRICTED
PAYMENTS"), unless, at the time of such Restricted Payment:
(i) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(ii) after giving effect to such Restricted Payment and the
incurrence of any Indebtedness the net proceeds of which are used to
finance such Restricted Payment, the Indebtedness to Cash Flow Ratio of DBS
Corp would not have exceeded 6.0 to 1; and
(iii) such Restricted Payment, together with the aggregate of all
other Restricted Payments made by DBS Corp after the date of this
Indenture, is less than the sum of: (A) the difference of cumulative (x)
Consolidated Cash Flow determined at the time of such Restricted Payment
(or, in case such Consolidated Cash Flow shall be a deficit, minus 100% of
such deficit) minus (y) 150% of Consolidated Interest Expense of DBS Corp,
each as determined for the period (taken as one accounting period) from
October 1, 1997 to the end of DBS Corp's most recently ended fiscal quarter
for which internal financial statements are available at the time of such
Restricted Payment; plus (B) an amount equal to 100% of the aggregate net
cash proceeds received by DBS Corp and its Subsidiaries from the issue or
sale of Equity Interests (other than Disqualified Stock) of DBS Corp or the
Company (other than Equity Interests sold to a Subsidiary of DBS Corp or
the Company, and PROVIDED that any sale of Equity Interests of DBS Corp
shall only be included in such calculation to the extent that the proceeds
thereof are contributed to the capital of DBS Corp other than as
Disqualified Stock or Indebtedness), since June 25, 1997.
The foregoing provisions will not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration thereof, if at such date of declaration such payment would have
complied with the provisions of this Indenture;
(2) the redemption, repurchase, retirement or other acquisition of
any Equity Interests of DBS Corp in exchange for, or out of the net
proceeds of, the substantially concurrent sale (other than to a Subsidiary
of the Company) of other Equity Interests of DBS Corp (other than
Disqualified Stock);
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(3) the payment of dividends on, or the redemption of, the Dish
Preferred Stock;
(4) Investments in an aggregate amount not to exceed $20 million;
PROVIDED that such Investments are in businesses of the type described in
Section 4.18;
(5) Investments to fund the financing activity of DNCC in the ordinary
course of its business in an amount not to exceed, as of the date of
determination, the sum of (A) $25.0 million plus (B) 30% of the aggregate
cost to DNCC for each Satellite Receiver purchased by DNCC and leased by
DNCC to a retail consumer in excess of 100,000 units;
(6) the purchase of employee stock options, or capital stock issued
pursuant to the exercise of employee stock options, in an aggregate amount
not to exceed $2 million in any calendar year and in an aggregate amount
not to exceed $10 million since the date of this Indenture;
(7) a Permitted Refinancing as defined in Section 4.9 of this
Indenture;
(8) Investments in an amount equal to the net proceeds received by
DBS Corp or any of its Restricted Subsidiaries from the issue and sale of
Equity Interests of the Company (other than Equity Interests sold to a
Subsidiary of the Company and other than Disqualified Stock), since June
25, 1997; provided that the entity making such Investment (if other than
the Company) receives a capital contribution from EchoStar in an amount
greater than or equal to the amount of such Investment;
(9) the purchase of odd-lots of Equity Interests of EchoStar, in an
amount not to exceed $1 million in the aggregate;
(10) Investments in ExpressVu Inc. or an Affiliate thereof, in an
amount not to exceed the amount necessary to exercise the purchase options
granted, through the date of this Indenture, to the Company or its
Subsidiaries with respect to ExpressVu, Inc.;
(11) Investments in ABCN, Inc. or an Affiliate thereof, in an amount
not to exceed the amount necessary to exercise the purchase options
granted, through the date of this Indenture, to DBS Corp or its
Subsidiaries with respect to ABCN, Inc.; or
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(12) the payment of any dividend, or making of any distribution or
Investment, the proceeds of which are, within five Business Days of receipt
thereof, used to pay (x) for the construction, launch, operation or
insurance of EchoStar III, PROVIDED that at the time of any such payment,
distribution or Investment, EchoStar III shall be owned by EchoStar or any
Wholly Owned Subsidiary of EchoStar or (y) any cash dividend on the 12 1/8%
Senior Preferred Stock..
The amounts referred to in clauses (1) and (8) shall be included as
Restricted Payments in any computation made pursuant to clause (iii) of this
Section 4.7.
Not later than the date of making any Restricted Payment, the Company
shall cause DBS Corp to deliver to the Trustee an Officers' Certificate
stating that such Restricted Payment is permitted and setting forth the
basis upon which the calculations required by this Section 4.7 were computed,
which calculations shall be based upon the Company's latest available
financial statements.
SECTION 4.8 DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
DBS Corp shall not, and the Company shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause
or suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary to (a) pay dividends or make any other
distributions to DBS Corp or any of its Restricted Subsidiaries on its
Capital Stock or with respect to any other interest or participation in, or
measured by, its profits, or pay any Indebtedness owed to DBS Corp or any of
its Subsidiaries, (b) make loans or advances to DBS Corp or any of its
Subsidiaries or (c) transfer any of its properties or assets to DBS Corp or
any of its Subsidiaries, except for such encumbrances or restrictions
existing under or by reasons of (i) Existing Indebtedness and existing
agreements as in effect on the date of this Indenture, (ii) any Credit
Agreement containing any encumbrances or restrictions that are no more
restrictive with respect to the provisions set forth in clauses (a), (b) and
(c) above than the 1994 Credit Agreement as in effect on the date of its
expiration, (iii) applicable law or regulation, (iv) any instrument governing
Acquired Debt as in effect at the time of acquisition (except to the extent
such Indebtedness was incurred in connection with, or in contemplation of,
such acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the Person, or
the property or assets of the Person, so acquired, PROVIDED that the
Consolidated Cash Flow of such Person shall not be taken into account in
determining whether such acquisition was permitted by the terms of this
Indenture, (v)
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by reason of customary non-assignment provisions in leases entered into in
the ordinary course of business and consistent with past practices, or (vi)
Refinancing Indebtedness, as defined in Section 4.9 herein, PROVIDED that the
restrictions contained in the agreements governing such Refinancing
Indebtedness are no more restrictive than those contained in the agreements
governing the Indebtedness being refinanced.
SECTION 4.9 INCURRENCE OF INDEBTEDNESS, ISSUANCE OF DISQUALIFIED STOCK AND
ISSUANCE OF PREFERRED EQUITY INTERESTS OF SUBSIDIARIES.
DBS Corp shall not, and DBS Corp shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guaranty or otherwise become directly or indirectly liable with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt) or DBS
Corp to issue any Disqualified Stock and DBS Corp shall not permit any of its
Restricted Subsidiaries to issue any Preferred Equity Interest; PROVIDED,
HOWEVER, that notwithstanding the foregoing DBS Corp and each of its
Restricted Subsidiaries may incur Indebtedness or issue Disqualified Stock or
Preferred Equity Interests if, after giving effect to the incurrence of such
Indebtedness or the issuance of such Disqualified Stock or Preferred Equity
Interests and the application of the net proceeds thereof, the Indebtedness
to Cash Flow Ratio of DBS Corp would not have exceeded 6.0 to 1.
(b) The foregoing limitation will not apply to:
(i) the incurrence of the Deferred Payments and letters of credit
with respect thereto;
(ii) the incurrence of Bank Debt;
(iii) the incurrence of Indebtedness in an aggregate amount not to
exceed $15 million upon a finding by DBS Corp (evidenced by a resolution of
the Board of Directors of EchoStar set forth in an Officers' Certificate
delivered to the Trustee) that such Indebtedness is necessary to finance
costs in connection with the development, construction, launch or insurance
of EchoStar III or IV (or any permitted replacements thereof);
(iv) Indebtedness between and among DBS Corp and each of its
Restricted Subsidiaries;
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(v) Acquired Debt of a Person incurred prior to the date upon which
such Person was acquired by DBS Corp or any of its Subsidiaries (excluding
Indebtedness incurred by such entity other than in the ordinary course of its
business in connection with, or in contemplation of, such entity being so
acquired) in an aggregate principal amount not to exceed $15 million,
PROVIDED that such Indebtedness and the holders thereof do not at any time
have direct or indirect recourse to any property or assets of DBS Corp or any
of its Restricted Subsidiaries other than the property and assets of such
acquired entity and its Subsidiaries;
(vi) Existing Indebtedness;
(vii) additional Indebtedness in an aggregate amount not to exceed
$15 million at any one time outstanding;
(viii) the incurrence of Purchase Money Indebtedness by DBS Corp and
any Restricted Subsidiary in an aggregate amount not to exceed $30 million at
any one time outstanding; or
(ix) the incurrence by DBS Corp or any of its Restricted
Subsidiaries of Indebtedness issued in exchange for, or the proceeds of which
are used to extend, refinance, renew, replace, substitute or refund
Indebtedness referred to in clauses (i), (iii), (v), (vi), (vii) and (viii)
above ("DBS Refinancing Indebtedness"); PROVIDED, HOWEVER, that (A) the
principal amount of such DBS Refinancing Indebtedness shall not exceed the
principal amount and accrued interest of the Indebtedness so extended,
refinanced, renewed, replaced, substituted or refunded; and (B) the DBS
Refinancing Indebtedness shall have a final maturity later than, and a
Weighted Average Life to Maturity equal to or greater than the final maturity
and Weighted Average Life to Maturity of the Indebtedness being extended,
refinanced, renewed, replaced or refunded.
(c) In addition, the Company shall not incur any Indebtedness (including
Acquired Debt), and the Company shall not permit any Subsidiary of the
Company which owns any Equity Interests (including for these purposes any
debt security that is convertible into, or exchangeable for, Capital Stock)
in DBS Corp (a "Bound Subsidiary") to issue Disqualified Stock or Preferred
Equity Interests or incur any Indebtedness (including Acquired Debt);
PROVIDED, HOWEVER, that, notwithstanding the foregoing the Company may incur
Indebtedness, and Bound Subsidiaries may incur Indebtedness or issue
Disqualified Stock or Preferred Equity Interests if, after giving effect to
the incurrence of such Indebtedness or the issuance of the Disqualified Stock
or Preferred Equity Interests, and the application of the net proceeds
thereof, the Indebtedness to Cash Flow Ratio of the Company would not have
exceeded 6.0 to 1.
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(d) The foregoing limitation in Section 8.3(c) will not apply to any of
the following:
(i) Indebtedness between and among the Company and each of its
Subsidiaries;
(ii) Acquired Debt of a person incurred prior to the date upon
which such person was acquired by the Company or any of its Bound
Subsidiaries (excluding Indebtedness incurred by such entity other than in
the ordinary course of its business in connection with, or in contemplation
of, such entity being so acquired) in an aggregate principal amount not to
exceed $15 million, PROVIDED that such Indebtedness and the holders thereof
do not at any time have direct or indirect recourse to any property or assets
of the Company or any of its Bound Subsidiaries other than the property and
assets of such acquired entity and its Subsidiaries:
(iii) Existing Indebtedness;
(iv) Additional Indebtedness in an aggregate amount not to exceed
$25 million at any one time outstanding;
(v) The incurrence of Purchase Money Indebtedness by the Company
or any Bound Subsidiary in an aggregate amount not to exceed $10 million at
any one time outstanding;
(vi) The incurrence by the Company or any of it Bound Subsidiaries
of Indebtedness issued in exchange for, or the proceeds of which are used to
extend, refinance, renew, replace, substitute or refund Indebtedness referred
to in clauses (ii), (iii), (iv) and (v) above ("Company Refinancing
Indebtedness"), PROVIDED, HOWEVER, that: (A) the principal amount of such
Company Refinancing Indebtedness shall not exceed the principal amount and
accrued interest of the Indebtedness so extended, refinanced, renewed,
replaced substituted or refunded; (B) the Company Refinancing Indebtedness
shall have a final maturity later than, and a Weighted Average Life to
Maturity equal to or greater than, the final maturity and Weighted Average
Life to Maturity of the Indebtedness being extended, refinanced, renewed,
replaced or refunded; and (C) the Company Refinancing Indebtedness shall be
subordinated in right of payment to the debt being refinanced, if at all, on
terms at least as favorable to the holders of such debt as those contained in
the documentation governing the Indebtedness being extended, refinanced,
renewed, replaced or refunded; (a "Company Permitted Refinancing").
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SECTION 4.10 ASSET SALES
If DBS Corp or any of its Restricted Subsidiaries, in a single
transaction or a series of related transactions:
(a) sells, leases, conveys or otherwise disposes of any assets (including
by way of a sale-and-leaseback transaction), other than (i) sales of
inventory in the ordinary course of business, (ii) sales to DBS Corp or a
Wholly Owned Restricted Subsidiary of EchoStar DBS Corp. by any Restricted
Subsidiary of DBS Corp, (iii) sales of accounts receivable by EAC or DNCC for
cash in an amount at least equal to the fair market value of such accounts
receivable or (iv) sales of rights to satellite launches (PROVIDED that the
sale, lease, conveyance or other disposition of all or substantially all of
the assets of the Company shall be governed by the provisions of the Company
Indenture described below under the caption "Merger, Consolidation, or Sale
of Assets").
(b) issue or sell equity securities of any Restricted Subsidiary of DBS
Corp, in either case, which assets or securities (i) have a fair market value
(as determined in good faith by the Board of Directors of the Company
evidenced by a resolution of the Board of Directors of the Company and set
forth in an Officers' Certificate; PROVIDED HOWEVER, that if the fair market
value of such assets exceeds $20 million, the fair market value shall be
determined by an investment banking firm of national standing selected by the
Company) in excess of $10 million or (ii) are sold or otherwise disposed of
for net proceeds in excess of $10 million (each of the foregoing, an "Asset
Sale") then:
(A) DBS Corp or such Restricted Subsidiary, as the case may be, must
receive consideration at the time of such Asset Sale at least equal to the
fair market value (as determined in good faith by the Board of Directors of
the Company evidenced by a resolution of the Board of Directors of Company
and set forth in an Officers' Certificate; PROVIDED, HOWEVER, that if the
fair market value of such assets exceeds $20 million, the fair market value
shall be determined by an investment banking firm of national standing
selected by the Company of the assets sold or otherwise disposed of; and
(B) at least 80% of the consideration therefor received by DBS Corp or
such Restricted Subsidiary, as the case may be, is in the form of cash or
Cash Equivalents; PROVIDED, HOWEVER, that DBS Corp may consider up to $15
million of non-cash assets at any one time to be cash for purposes of this
clause (B), PROVIDED that the provisions of the next paragraph are complied
with as such non-cash assets are converted to cash.
(C) Any Net Proceeds from any Asset Sale that are not applied or invested
in the business of the Company within 180 days after such Asset Sale, or not
applied to an offer
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to repurchase 1994 Notes required by the 1994 Notes Indenture, the 1996
Notes required by the 1996 Notes Indenture, and the 1997 Notes required by
the 1997 Notes Indenture shall be applied to an offer to purchase senior
Preferred Stock at a purchase price of 101% of the liquidation preference
thereof, plus accumulated and unpaid dividends to the date of purchase:
provided that any such obligation to make such an offer shall not become
effective until such time as the 1997 Notes and the 1996 Notes have been paid
in full or have otherwise matured.
(D) Notwithstanding the foregoing, any transaction which would not
constitute an Asset Sale, or which would not be subject to the terms of the
Asset Sale covenant contained in the 1997 Notes Indenture, shall not
constitute an Asset Sale for purposes of this Asset Sale covenant.
SECTION 4.11 TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Subsidiaries to,
sell, lease, transfer or otherwise dispose of any of its properties or assets
to, or purchase any property or assets from, or enter into any contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (including any Unrestricted Subsidiary) (each of the
foregoing, an "Affiliate Transaction"), unless:
(a) such Affiliate Transaction is on terms that are no less favorable to
DBS Corp or its Subsidiaries than those that would have been obtained in a
comparable transaction by DBS Corp or such Subsidiaries with an unrelated
Person,
(b) if such Affiliate Transaction involves aggregate payments in excess
of $500,000, DBS Corp delivers to the Trustee a resolution of the Board of
Directors of DBS Corp set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with clause (a) above and such Affiliate
Transaction is approved by a majority of disinterested members of the Board
of Directors of EchoStar, and
(c) if such Affiliate Transaction involves aggregate payments in excess
of $15 million, DBS Corp delivers to the Trustee an opinion as to the
fairness to DBS Corp or such Subsidiaries from a financial point of view of
such Affiliate Transaction issued by an investment banking firm of national
standing;
PROVIDED, HOWEVER, that (i) the payment of compensation to directors and
management of EchoStar in amounts approved by the Compensation Committee of
the Board of Directors of EchoStar (which shall consist of a majority of
outside directors); (ii) transactions between or among DBS Corp and its
Wholly Owned Subsidiaries (other
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than Unrestricted Subsidiaries of the DBS Corp); (iii) the
transfer of rights and interests in any permits or licenses relating to the use
of channels at the 166DEG. West Longitude or 175DEG. West Longitude orbital
slot; (iv) transactions permitted by the provisions of this Indenture described
above under clauses (1), (3), (5), (6), (7), (9) and (12) of the second
paragraph of Section 4.7 of this Indenture; and (v) any transactions between or
among EchoStar and any Subsidiary of EchoStar which is not also a Subsidiary of
the Company, shall, in each case, not be deemed Affiliate Transactions.
SECTION 4.12 [INTENTIONALLY OMITTED]
SECTION 4.13 SUBSIDIARY GUARANTEES
If DBS Corp or any Guarantor transfers or causes to be transferred, in one
or a series of related transactions, property or assets (including, without
limitation, businesses, divisions, real property, assets or equipment) having a
fair market value (as determined in good faith by the Board of Directors of
EchoStar evidenced by a resolution of the Board of Directors of EchoStar and set
forth in an Officers' Certificate delivered to the Trustee; PROVIDED, HOWEVER
that if the fair market value exceeds $10 million, the fair market value shall
be determined by an investment banking firm of national standing selected by DBS
Corp) exceeding $500,000 to any Restricted Subsidiary of DBS Corp that is
neither a Subsidiary of ESBC nor a Guarantor, EchoStar, to the extent not
otherwise precluded by obligations set forth in the 1997 Notes Indenture, 1996
Notes Indenture or the 1994 Notes Indenture, shall, or shall cause the owner of
such Subsidiary to: (a) enter into a pledge agreement in order to pledge all of
the issued and outstanding Capital Stock of such Subsidiary as security to the
Trustee for the benefit of the Holders of the Notes; and (b) cause such
Subsidiary to: (i) execute and deliver to the Trustee a supplemental indenture
in form and substance reasonably satisfactory to the Trustee pursuant to which
such Subsidiary shall unconditionally Guarantee all of EchoStar's obligations
under the Notes and execute a notation in form and substance reasonably
satisfactory to the Trustee; and (ii) deliver to the Trustee an Opinion of
Counsel reasonably satisfactory to the Trustee that such pledge agreement and
such supplemental indenture have been duly authorized, executed and delivered by
and are valid and binding obligations of such Subsidiary or such owner, as the
case may be; PROVIDED, HOWEVER, that the foregoing provisions shall not apply to
transfers of property or assets (other than cash) by DBS Corp or any Guarantor
in exchange for cash or Cash Equivalents in an amount equal to the fair market
value (as determined in good faith by the Board of Directors of EchoStar
evidenced by a resolution of the Board of Directors of EchoStar and set forth in
an Officers' Certificate delivered to the Trustee; PROVIDED, FURTHER, HOWEVER,
that if the fair market value exceeds $10 million, the fair market value shall
be
-41-
determined by an investment banking firm of national standing selected by
EchoStar) of such property or assets.
SECTION 4.14 [Intentionally Omitted]
SECTION 4.15 OFFER TO PURCHASE UPON CHANGE OF CONTROL OR ORBITAL EVENT.
Subject to any contractual or other restrictions, upon the occurrence of a
Change of Control, the Company shall make an offer (a "CHANGE OF CONTROL
OFFER") to each Holder of Notes to repurchase all or any part (equal to $1,000
or an integral multiple thereof) of such Holder's Notes at a purchase price
equal to 101% of the aggregate principal amount thereof, together with accrued
and unpaid interest thereon to the date of repurchase (the "CHANGE OF CONTROL
PAYMENT"), PROVIDED that if the date of purchase is on or after an interest
record date and on or before the related interest payment date, any accrued
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be paid
or payable to Holders who tender Notes pursuant to the Change of Control Offer,
PROVIDED FURTHER that any such offer may be deferred by the Company until such
time as the 1997 Notes and the 1996 Notes have been paid in full or have
otherwise matured. Within 15 days following any Change of Control, the Company
shall mail a notice to the Trustee and each Holder stating: (1) that the Change
of Control Offer is being made pursuant to this Section 4.15 and that all Notes
tendered will be accepted for payment; (2) the purchase price and the purchase
date, which shall be no earlier than 30 days nor later than 40 days after the
date such notice is mailed (the "CHANGE OF CONTROL PAYMENT DATE"); (3) that
any Note not tendered will continue to accrue interest in accordance with its
terms; (4) that, unless the Company defaults in the payment of the Change of
Control Payment, all Notes accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of Control
Payment Date; (5) that Holders electing to have any Notes purchased pursuant to
a Change of Control Offer will be required to surrender the Notes, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Change of Control
Payment Date; (6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Notes delivered for purchase, and a statement that such
Xxxxxx is withdrawing his election to have such Notes purchased; (7) that
Holders whose Notes are being purchased only in part will be issued new Notes
equal
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in principal amount to the unpurchased portion of the Notes surrendered,
which unpurchased portion must be equal to $1,000 in principal amount or an
integral multiple thereof; and (8) any other information material to such
Xxxxxx's decision to tender Notes.
(b) Subject to any contractual or other restrictions, upon the occurrence
of an Orbital Event, the Company shall make an offer (an "ORBITAL EVENT OFFER")
to each Holder of Notes to repurchase one-half of such Holder's Notes (equal to
$1,000 or an integral multiple thereof) at a purchase price equal to 101% of the
aggregate principal amount thereof, together with accrued and unpaid interest
thereon to the date of repurchase (the "ORBITAL EVENT PAYMENT"), PROVIDED that
if the date of purchase is on or after an interest record date and on or before
the related interest payment date, any accrued interest shall be paid to the
Person in whose name a Note for registered at the close of business on such
record date, and no additional interest shall be paid or payable to Holders who
tender Notes pursuant to the Orbital Event Offer, PROVIDED FURTHER that any such
offer may be deferred by the Company until such time as the 1997 Notes and the
1996 Notes have been paid in full or have otherwise matured. Within 15 days
following any Orbital Event, the Company shall mail a notice to the Trustee and
each Holder stating: (1) that the Orbital Event Offer is being made pursuant to
this Section 4.15 and that all Notes tendered will be accepted for payment; (2)
the purchase price and the purchase date, which shall be no earlier than 30
days nor later than 40 days after the date such notice is mailed (the "ORBITAL
EVENT PAYMENT DATE"); (3) that any Note not tendered will continue to accrue
interest in accordance with its terms; (4) that, unless the Company defaults in
the payment of the Orbital Event Payment, all Notes accepted for payment
pursuant to the Orbital Event Offer shall cease to accrue interest after the
Orbital Event Payment Date; (5) that Holders electing to have any Notes
purchased pursuant to an Orbital Event Offer will be required to surrender the
Notes, with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes completed, to the Paying Agent at the address specified in
the notice prior to the close of business on the third Business Day preceding
the Orbital Event Payment Date; (6) that Holders will be entitled to withdraw
their election if the Paying Agent receives, not later than the close of
business on the second Business Day preceding the Orbital Event Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes delivered for purchase, and a statement
that such Xxxxxx is withdrawing his election to have such Notes purchased; (7)
that Holders whose Notes are being purchased only in part will be issued new
Notes equal in principal amount to the unpurchased portion of the Notes
surrendered, which unpurchased portion must be equal to $1,000 in principal
amount or an integral multiple thereof; and (8) any other information material
to such Holder's decision to tender Notes.
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(c) The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes in connection with a Change of Control or an Orbital
Event.
(d) On the Change of Control Payment Date and/or the Orbital Event Payment
Date as the case may be, the Company shall, to the extent lawful, (1) accept
for payment Notes or portions thereof tendered pursuant to the Change of
Control Offer and/or the Orbital Event Offer, as the case may be, (2) deposit
with the Paying Agent an amount equal to the Change of Control Payment and/or
the Orbital Event Payment, as the case may be, in respect of all Notes or
portions thereof so tendered and (3) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating
the Notes or portions thereof tendered to the Company. The Paying Agent shall
promptly mail to each Holder of Notes so accepted payment in an amount equal to
the purchase price for such Notes, and the Trustee shall promptly authenticate
and mail to each Holder a new Note equal in principal amount to any unpurchased
portion of the Notes surrendered, if any; PROVIDED, that each such new Note
shall be in a principal amount of $1,000 or an integral multiple thereof. The
Company shall publicly announce the results of the Change of Control Offer
and/or the Orbital Event Offer, as the case may be, on or as soon as
practicable after the Change of Control Payment Date and/or the Orbital Event
Offer, as the case may be.
SECTION 4.16 [INTENTIONALLY OMITTED]
SECTION 4.17 [INTENTIONALLY OMITTED]
SECTION 4.18 ACTIVITIES OF ECHOSTAR.
Neither EchoStar nor any of its Subsidiaries may engage in any business
other than developing, owning, engaging in and dealing with all or any part of
the business of domestic and international satellite communications, and
reasonably related extensions thereof, including but not limited to the
purchase, ownership, operation, leasing and selling of, and generally dealing
in or with, one or more communications satellites and the transponders thereon,
the acquisition, transmission, broadcast, production and other provision of
programming therewith and the manufacturing, distribution and financing of
equipment (including consumer electronic equipment) relating thereto.
SECTION 4.19 [INTENTIONALLY OMITTED]
SECTION 4.20 [INTENTIONALLY OMITTED]
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SECTION.4.21 [INTENTIONALLY OMITTED]
SECTION 4.22 SIGNIFICANT TRANSACTIONS.
EchoStar or any of its Subsidiaries may enter into a transaction or series
of transactions (a "SIGNIFICANT TRANSACTION") with another entity (a "STRATEGIC
PARTNER"), notwithstanding the fact that such Significant Transaction would
otherwise be prohibited under the terms of this Indenture, in which EchoStar or
any such Subsidiary (i) sells, leases, conveys or otherwise disposes of any of
its assets (including by way of a sale-and-leaseback transaction) to such
Strategic Partner or (ii) makes an Investment in or receives an Investment from
such Strategic Partner; PROVIDED that: (i) EchoStar or such Subsidiary
receives fair market value for any property or assets (including capital stock)
transferred in such Significant Transaction in the opinion of a majority of the
Board of Directors of EchoStar as evidenced by an Officers' Certificate
delivered to the Trustee and an investment banking firm of national standing
selected by the Company; and (ii) in connection with the consummation of such
Significant Transaction, the Company makes an offer (a "Special Offer to
Purchase") to each Holder of Notes to repurchase, within 15 days following the
consummation of such Significant Transaction, all or any part (equal to $1,000
or an integral multiple thereof) of such Holder's Notes at a purchase price
equal to 101% of the aggregate principal amount thereof, together with accrued
and unpaid interest thereon to the date of purchase (in either case, the
"Special Offer Payment"); PROVIDED that such offer shall be made prior to the
consummation of such Significant Transaction unless at such time the 1997 Notes
and the 1996 Notes have not been paid in full or have otherwise matured, in
which case the offer shall be made immediately after the full payment or other
maturity of the 1996 Notes and the 1997 Notes.
At least 30 days prior to the consummation of such Significant
Transaction, the Company shall mail a notice to each Holder stating:
(a) that the Special Offer to Purchase is being made pursuant to this
Section 4.22 of this Indenture;
(b) the purchase price and the purchase date, which shall be no
earlier than 30 days nor later than 60 days after the date such notice is mailed
(the "SPECIAL OFFER PAYMENT DATE");
(c) that any Notes tendered will only be repurchased in the event
that such Significant Transaction is consummated;
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(d) that any Notes not tendered or not repurchased will continue to
accrue interest in accordance with the terms of this Indenture;
(e) that, if such Significant Transaction is consummated, unless the
Company defaults in the payment of the Special Offer Payment, all Notes accepted
for payment pursuant to the Special Offer to Purchase shall cease to accrue
interest after the Special Offer Payment Date;
(f) that Holders electing to have any Notes purchased pursuant to an
Offer to Purchase will be required to surrender the Notes, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Notes
completed, to the Paying Agent at the address specified in the notice prior to
the close of business on the third Business Day preceding the Special Offer
Payment Date;
(g) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Special Offer Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of Notes delivered for purchase, and a statement that such
Xxxxxx is withdrawing his election to have such Notes purchased;
(h) 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, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof; and
(i) a description of such Significant Transaction, as well as any
other information material to such Xxxxxx's decision to tender Notes.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to a Special Offer to Purchase.
SECTION 4.23 ACCOUNTS RECEIVABLE SUBSIDIARY.
DBS Corp
(a) may, and may permit any of its Subsidiaries to, notwithstanding
Section 4.7 herein or any other requirements of this Indenture, make Investments
in an Accounts Receivable Subsidiary: (i) the proceeds of which are applied
within five
-46-
Business Days of the making thereof solely to finance: (A) the purchase of
accounts receivable of DBS Corp and its Subsidiaries or (B) payments required
in connection with the termination of all then existing arrangements relating
to the sale of accounts receivable or participation interests therein by an
Accounts Receivable Subsidiary (PROVIDED that the Accounts Receivable
Subsidiary shall receive cash, Cash Equivalents and accounts receivable
having an aggregate fair market value not less than the amount of such
payments in exchange therefor) and (ii) in the form of Accounts Receivable
Subsidiary Notes to the extent permitted by clause (b) below;
(b) shall not, and shall not permit any of its Subsidiaries to, sell
accounts receivable to an Accounts Receivable Subsidiary except for
consideration in an amount not less than that which would be obtained in an
arm's length transaction and solely in the form of cash or Cash Equivalents;
PROVIDED that an Accounts Receivable Subsidiary may pay the purchase price for
any such accounts receivable in the form of Accounts Receivable Subsidiary
Notes so long as, after giving effect to the issuance of any such Accounts
Receivable Subsidiary Notes, the aggregate principal amount of all Accounts
Receivable Subsidiary Notes outstanding shall not exceed 20% of the aggregate
purchase price paid for all outstanding accounts receivable purchased by an
Accounts Receivable Subsidiary since the date of this Indenture (and not
written-off or required to be written off in accordance with the normal
business practice of an Accounts Receivable Subsidiary);
(c) shall not permit an Accounts Receivable Subsidiary to sell any
accounts receivable purchased from DBS Corp and its Subsidiaries or
participation interests therein to any other Person except on an arm's length
basis and solely for consideration in the form of cash or Cash Equivalents or
certificates representing undivided interests of a Receivables Trust; PROVIDED
an Accounts Receivable Subsidiary may not sell such certificates to any other
Person except on an arm's length basis and solely for consideration in the form
of cash or Cash Equivalents;
(d) shall not, and shall not permit any of its Subsidiaries to,
enter into any Guarantee, subject any of their respective properties or assets
(other than the accounts receivable sold by them to an Accounts Receivable
Subsidiary) to the satisfaction of any liability or obligation or otherwise
incur any liability or obligation (contingent or otherwise), in each case, on
behalf of an Accounts Receivable Subsidiary or in connection with any sale of
accounts receivable or participation interests therein by or to an Accounts
Receivable Subsidiary, other than obligations relating to breaches of
representations, warranties, covenants and other agreements of DBS Corp or any
of its Subsidiaries with respect to the accounts receivable sold by DBS Corp or
any of its Subsidiaries to an Accounts Receivable Subsidiary or with respect to
the servicing
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thereof; PROVIDED that neither DBS Corp nor any of its Subsidiaries shall at
any time guarantee or be otherwise liable for the collectibility of accounts
receivable sold by them;
(e) shall not permit an Accounts Receivable Subsidiary to engage in
any business or transaction other than the purchase and sale of accounts
receivable or participation interests therein of DBS Corp and its Subsidiaries
and activities incidental thereto;
(f) shall not permit an Accounts Receivable Subsidiary to incur any
Indebtedness other than the Accounts Receivable Subsidiary Notes, Indebtedness
owed to DBS Corp and Non-Recourse Indebtedness; PROVIDED that the aggregate
principal amount of all such Indebtedness of an Accounts Receivable Subsidiary
shall not exceed the book value of its total assets as determined in accordance
with GAAP;
(g) shall cause any Accounts Receivable Subsidiary to remit to DBS
Corp or a Subsidiary of DBS Corp on a monthly basis as a distribution all
available cash and Cash Equivalents not held in a collection account pledged to
acquirors of accounts receivable or participation interests therein, to the
extent not applied to (i) pay interest or principal on the Accounts Receivable
Subsidiary Notes or any Indebtedness of such Accounts Receivable Subsidiary owed
to DBS Corp, (ii) pay or maintain reserves for reasonable operating expenses of
such Accounts Receivable Subsidiary or to satisfy reasonable minimum operating
capital requirements or (iii) to finance the purchase of additional accounts
receivable of DBS Corp and its Subsidiaries; and
(h) shall not, and shall not permit any of its Subsidiaries to, sell
accounts receivable to, or enter into any other transaction with or for the
benefit of, an Accounts Receivable Subsidiary (i) if such Accounts Receivable
Subsidiary pursuant to or within the meaning of any Bankruptcy Law (A) commences
a voluntary case, (B) consents to the entry of an order for relief against it in
an involuntary case, (C) consents to the appointment of a custodian of it or for
all or substantially all of its property, (D) makes general assignment for the
benefit of its creditors, or (E) generally is not paying its debts as they
become due; or (ii) if a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that (A) is for relief against such Accounts
Receivable Subsidiary in an involuntary case, (B) appoints a custodian of such
Accounts Receivable Subsidiary or for all or substantially all of the property
of such Accounts Receivable Subsidiary, or (C) orders the liquidation of such
Accounts Receivable Subsidiary, and, with respect to clause (ii) hereof, the
order or decree remains unstayed and in effect for 60 consecutive days.
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ARTICLE 5
SUCCESSORS
SECTION 5.1 MERGER, CONSOLIDATION, OR SALE OF ASSETS.
DBS Corp may not consolidate or merge with or into (whether or not DBS Corp
is the surviving entity), or sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all of its properties or assets in one or more
related transactions to, another Person unless (a) DBS Corp is the surviving
Person or the Person formed by or surviving any such consolidation or merger (if
other than DBS Corp) or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation organized
or existing under the laws of the United States, any state thereof or the
District of Columbia; (b) the Person formed by or surviving any such
consolidation or merger (if other than DBS Corp) or the Person to which such
sale, assignment, transfer, lease, conveyance or other disposition shall have
been made assumes all the obligations of DBS Corp, pursuant to a supplemental
indenture in a form reasonably satisfactory to the Trustee, under the Notes and
this Indenture; (c) immediately after such transaction no Default or Event of
Default exists; and (d) DBS Corp or the Person formed by or surviving any such
consolidation or merger (if other than DBS Corp), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made (i) shall have Consolidated Net Worth immediately after the transaction
(but prior to any purchase accounting adjustments or accrual of deferred tax
liabilities resulting from the transaction) not less than the Consolidated Net
Worth of DBS Corp immediately preceding the transaction and (ii) would, at the
time of such transaction after giving pro forma effect thereto as if such
transaction had occurred at the beginning of the applicable four-quarter
period, be permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Indebtedness to Cash Flow Ratio test set forth in Section 4.9.
Notwithstanding the foregoing, DBS Corp may merge with another Person if
(a) DBS Corp is the surviving Person; (b) the consideration issued or paid by
DBS Corp in such merger consists solely of Equity Interests (other than
Disqualified Stock) of DBS Corp; and (c) immediately after giving effect to such
merger, DBS Corp's Indebtedness to Cash Flow Ratio does not exceed DBS Corp's
Indebtedness to Cash Flow Ratio immediately prior to such merger.
SECTION 5.2 MERGER, CONSOLIDATION, OR SALE OF ASSETS.
EchoStar may not consolidate or merge with or into or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets in
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one or more related transactions to, another Person unless (a) EchoStar is the
surviving Person or the Person formed by or surviving any such consolidation
or merger (if other than EchoStar) or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States, any
state thereof or the District of Columbia; (b) the Person formed by or
surviving any such consolidation or merger (if other than EchoStar) or the
Person to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made assumes all the obligations of EchoStar,
pursuant to a supplemental indenture in a form reasonably satisfactory to the
Trustee, under the Notes and this Indenture; (c) immediately after such
transaction no Default or Event of Default exists; and (d) EchoStar or the
Person formed by or surviving any such consolidation or merger, or to which
such sale, assignment, transfer, lease, conveyance or other disposition shall
have been made (i) shall have Consolidated Net Worth immediately after the
transaction (but prior to any purchase accounting adjustments or accrual of
deferred tax liabilities resulting from the transaction) not less than the
Consolidated Net Worth of EchoStar immediately preceding the transaction and
(ii) will have an Indebtedness to Cash Flow Ratio immediately after the
transaction that does not exceed EchoStar's Indebtedness to Cash Flow Ratio
immediately preceding the transaction
SECTION 5.3 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company in
accordance with Section 5.2, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such
sale, lease, conveyance or other disposition is made shall succeed to, and be
substituted for (so that from and after the date of such consolidation, merger,
sale, lease, conveyance or other disposition, the provisions of this Indenture
referring to the Company shall refer instead to the successor corporation and
not to the Company), and may exercise every right and power of the Company
under this Indenture with the same effect as if such successor Person has been
named as the Company herein.
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ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1 EVENTS OF DEFAULT.
Each of the following constitutes an "EVENT OF DEFAULT" (unless the
provisions of Section 4.22 are applicable and the Company complies with such
provisions):
(a) default for 30 days in the payment when due of interest on the
Notes;
(b) default in the payment when due of principal on the Notes at
maturity, upon repurchase, redemption or otherwise;
(c) failure by the Company, DBS Corp or any of their Subsidiaries
to comply with the provisions of Section 4.10, Section 4.11, Section 4.15, or
Section 4.22;
(d) default under Section 4.7 or Section 4.9, which default remains
uncured for 15 days, or the breach of any representation or warranty, or the
making of any untrue statement, in any certificate delivered by the Company
pursuant to this Indenture;
(e) failure by the Company for 60 days after notice from the
Trustee or the Holders of at least 25% in principal amount of the Notes then
outstanding to comply with any of its other agreements in this Indenture or
the Notes;
(f) [omitted]
(g) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by EchoStar or any of its Subsidiaries other
than an Independent Subsidiary (or the payment of which is guaranteed by
EchoStar or any of its Subsidiaries other than an Independent Subsidiary),
other than any Credit Agreement, which default is caused by a failure to pay
when due principal or interest on such Indebtedness within the grace period
PROVIDED in such Indebtedness (a "PAYMENT DEFAULT"), and the principal
amount of any such Indebtedness, together with the principal amount of any
other such Indebtedness under which there has been a Payment Default,
aggregates $5.0 million or more;
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(h) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by EchoStar or any of its Subsidiaries other
than an Independent Subsidiary (or the payment of which is guaranteed by
EchoStar or any of its Subsidiaries other than an Independent Subsidiary),
other than any Credit Agreement, which default results in the acceleration
of such Indebtedness prior to its express maturity and the principal amount
of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $5.0 million or more;
(i) failure by the Company or any of its Subsidiaries other than an
Independent Subsidiary to pay final judgments (other than any judgment as to
which a reputable insurance company has accepted full liability) aggregating
in excess of $2.0 million, which judgments are not stayed within 60 days
after their entry;
(j) the Company or any Significant Subsidiary of the Company other
than an Independent Subsidiary pursuant to or within the meaning of
Bankruptcy Law: (i) commences a voluntary case; (ii) consents to the entry
of an order for relief against it in an involuntary case; (iii) consents to
the appointment of a Custodian of it or for all or substantially all of its
property; or (iv) makes a general assignment for the benefit of its
creditors;
(k) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (i) is for relief against the Company or any
Significant Subsidiary of the Company (other than an Independent Subsidiary)
in an involuntary case; (ii) appoints a Custodian of the Company or any
Significant Subsidiary of the Company (other than an Independent Subsidiary)
or for all or substantially all of the property of the Company or any
Significant Subsidiary of the Company (other than any Independent
Subsidiary); or (iii) orders the liquidation of the Company or any
Significant Subsidiary of the Company (other than any Independent
Subsidiary), and the order or decree remains unstayed and in effect for 60
consecutive days.
SECTION 6.2 ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clause (j) or (k) of Section 6.1) occurs and is continuing, the Trustee by
notice to the Company, or the Holders of at least 25% in aggregate principal
amount of the then outstanding Notes by written notice to the Company and the
Trustee, may declare all the Notes to be due and payable immediately (plus,
in the case of an Event of Default that is the result of an
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action by EchoStar or any of its Subsidiaries (other than an Independent
Subsidiary) intended to avoid restrictions on or premiums related to
redemptions of the Notes contained in this Indenture or the Notes, an amount
of premium that would have been applicable pursuant to the Notes or as set
forth in this Indenture). Notwithstanding the foregoing, in the case of an
Event of Default specified in clause (j) or (k) of Section 6.1, with respect
to the Company or any of its Subsidiaries (other than an Independent
Subsidiary), all outstanding Notes shall become and be immediately due and
payable without further action or notice. Holders of the Notes may not
enforce this Indenture or the Notes except as PROVIDED in this Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Holders of the Notes notice of
any continuing Default or Event of Default (except a Default or Event of
Default relating to the payment of principal or interest) if it determines
that withholding notice is in such Holders' interest. The Holders of a
majority in aggregate principal amount of the then outstanding Notes by
written notice to the Trustee may on behalf of all of the Holders waive any
existing Event of Default and its consequences under this Indenture except a
continuing Default or Event of Default in the payment of interest or premium
on, or principal of the Notes.
The Company is required to deliver to the Trustee annually a statement
regarding compliance with this Indenture, and the Company is required upon
becoming aware of any Default or Event of Default to deliver to the Trustee a
statement specifying such Default or Event of Default.
All powers of the Trustee hereunder will be subject to applicable
provisions of the Communications Act, including without limitation, the
requirements of prior approval for transfer of control or assignment of Title
III licenses.
SECTION 6.3 OTHER REMEDIES.
If an Event of Default occurs and is continuing and subject to the
provisions of this Indenture, the Trustee may pursue any available remedy to
collect the payment of principal, premium, if any, and interest on the Notes
or to enforce the performance of any provision of the Notes and this
Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or
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acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.
SECTION 6.4 WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
Notes then outstanding, by notice to the Trustee, may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences under this Indenture, except a continuing Default or Event
of Default in the payment of the principal of, premium, if any, or interest
on, the Notes. Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereon.
SECTION 6.5 CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding Notes
may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or
power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with the law or this Indenture that the Trustee
determines may be unduly prejudicial to the rights of other Holders of Notes
or that may involve the Trustee in personal liability.
SECTION 6.6 LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the provision
of indemnity; and
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(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Notwithstanding the foregoing or anything else to the contrary in
this Indenture, neither the Trustee nor any Holder may seek any remedy (other
than pursuit of a claim in bankruptcy) against the Company, including any
acceleration of the maturity thereof, until both the 1997 Notes and the 1996
Notes have been paid in full or have otherwise matured.
SECTION 6.7 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and
interest on the Note, on or after the respective due dates expressed in the
Note, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent
of the Holder of the Note.
SECTION 6.8 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.1(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel.
SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of
the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes), the Company's creditors or the
Company's property and shall be entitled and empowered
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to collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder of a Note 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 of the Notes, to pay to
the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.7. To the extent that the
payment of any such compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 7.7 out of the estate in any such proceeding, shall be denied
for any reason, payment of the same shall be secured by a Lien on, and shall
be paid out of, any and all distributions, dividends, money, securities and
other properties which the Holders of the Notes may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization
or arrangement or otherwise. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Holder of a Note any plan of reorganization, arrangement, adjustment
or composition affecting the Notes or the rights of any Holder of a Note
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder of a Note in any such proceeding.
SECTION 6.10 PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.7, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes
for principal, premium, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes.
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SECTION 6.11 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having
due regard to the merits and good faith of the claims or defenses made by the
party litigant. This Section does not apply to a suit by the Trustee, a suit
by a Holder of a Note pursuant to Section 6.7, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
ARTICLE 7
TRUSTEE
SECTION 7.1 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture,
and use the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only those
duties that are specifically set forth in this Indenture and no others, and
no implied covenants or obligations shall be read into this Indenture against
the Trustee; and
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(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
the Trustee shall examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 6.5.
(d) Whether or not therein expressly so PROVIDED, every provision of
this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders of Notes, unless such Holder shall have offered to
the Trustee security and indemnity satisfactory to the Trustee against any
loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money
held in trust by the Trustee need not be segregated from other funds except
to the extent required by law.
SECTION 7.2 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
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(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall
not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee
may consult with counsel and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from
liability in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically PROVIDED in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders unless such Holders 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.
(g) Except with respect to Section 4.4, the Trustee shall have no duty
to inquire as to the performance of the Company's covenants in Article 4. In
addition, the Trustee shall not be deemed to have knowledge of any Default or
Event of Default except (i) any Event of Default occurring pursuant to
Sections 4.1, 4.3 and 4.4 or (ii) any Default or Event of Default of which
the Trustee shall have received written notification or obtained actual
knowledge.
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Company or any Affiliate
of the Company with the same rights it would have if it were not Trustee.
However, in the event that the Trustee acquires any conflicting interest it
must eliminate such conflict within 90 days, apply to the SEC for permission
to continue as Trustee (if any of the
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Notes are registered pursuant to the Securities Act), or resign. Any Agent
may do the same with like rights and duties. The Trustee is also subject to
Sections 7.10 and 7.11.
SECTION 7.4 TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of
this Indenture, it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it shall not
be responsible for any statement or recital herein or any statement in the
Notes or any other document in connection with the sale of the Notes or
pursuant to this Indenture other than its certificate of authentication.
SECTION 7.5 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
known to a Responsible Officer of the Trustee, the Trustee shall mail to
Holders of Notes a notice of the Default or Event of Default within 90 days
after it occurs. Except in the case of a Default or Event of Default in
payment of principal of, premium, if any, or interest on any Note, the
Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is
in the interests of the Holders of the Notes.
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each May 15 beginning with the May 15 following the
date of this Indenture, the Trustee shall mail to the Holders of the Notes a
brief report dated as of such reporting date that complies with TIA Section
313(a) (but if no event described in TIA Section 313(a) has occurred within
the twelve months preceding the reporting date, no report need be
transmitted). The Trustee also shall comply with TIA Section 313(b). The
Trustee shall also transmit by mail all reports as required by TIA Section
313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the SEC and each stock exchange
on which any Notes are listed. The Company shall promptly notify the Trustee
when any Notes are listed on any stock exchange.
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SECTION 7.7 COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses
shall include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, except any such
loss, liability or expense as may be attributable to the negligence, willful
misconduct or bad faith of the Trustee. 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. The Company shall defend the claim and the Trustee shall cooperate
in the defense. The Trustee may have separate counsel and the Company shall
pay the reasonable fees and expenses of such counsel. The Company need not pay
for any settlement made without its consent, which consent shall not be
unreasonably withheld.
The obligations of the Company under this Section 7.7 shall survive the
satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Notes on all money or property held or collected
by the Trustee, except that held in trust to pay principal and interest on
particular Notes. Such Lien shall survive the satisfaction and discharge of
this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(k) or (l) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
SECTION 7.8 REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as PROVIDED in this Section.
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The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company and obtaining the prior written
approval of the FCC, if so required by the Communications Act, including Section
310(d) and the rules and regulations promulgated thereunder. The Holders of at
least a majority in principal amount of the then outstanding Notes may remove
the Trustee by so notifying the Trustee and the Company in writing. The Company
may remove the Trustee (subject to the prior written approval of the FCC, if
required by the Communications Act, including Section 310(d), and the rules and
regulations promulgated thereunder) if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) the Trustee is no longer in compliance with the foreign ownership
provisions of Section 310 of the Communications Act and the rules and
regulations promulgated thereunder.
(d) a Custodian or public officer takes charge of the Trustee or its
property; or
(e) 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 then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company
If a successor Xxxxxxx does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee after written request by any Holder of a Note who has been a
Holder of a Note for at least six months fails to comply with Section 7.10, such
Holder of a Note may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders of the Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, PROVIDED all sums owing to the
Trustee hereunder have been paid and subject to the Lien PROVIDED for in Section
7.7. Notwithstanding replacement of the Trustee pursuant to this Section 7.8,
the Company's obligations under Section 7.7 shall continue for the benefit of
the retiring Trustee.
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any state thereof authorized under such laws to exercise corporate
trustee power, shall be subject to supervision or examination by federal or
state authority and shall have a combined capital and surplus of at least $25
million as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the requirements
of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to TIA Section
310(b).
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8
DEFEASANCE AND COVENANT DEFEASANCE
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SECTION 8.1 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at its option, at any time, with respect to the Notes,
elect to have either Section 8.2 or 8.3 be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article Eight.
SECTION 8.2 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.1 of the option applicable to
this Section 8.2, the Company shall be deemed to have been discharged from its
obligations with respect to all outstanding Notes on the date the conditions set
forth below are satisfied (hereinafter, "LEGAL DEFEASANCE"). For this purpose,
such Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Notes, which
shall thereafter be deemed to be "outstanding" only for the purposes of Section
8.5 and the other Sections of this Indenture referred to in (a) and (b) below,
and to have satisfied all its other obligations under such Notes and this
Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (a) the rights of Holders of outstanding Notes to receive payments
in respect of the principal of, premium, if any, and interest on such Notes when
such payments are due, or on the redemption date, as the case may be, (b) the
Company's obligations with respect to such Notes under Sections 2.5, 2.7, 2.8,
2.10, 2.11 and 4.2, (c) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations in connection therewith and (d)
this Article Eight. Subject to compliance with this Article Eight, the Company
may exercise its option under this Section 8.2 notwithstanding the prior
exercise of its option under Section 8.3 with respect to the Notes.
SECTION 8.3 COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.1 of the option applicable to
this Section 8.3, the Company shall be released from its obligations under the
covenants contained in Sections 4.3, 4.4, 4.7, 4.8, 4.9, 4.10, 4.11, 4.12, 4.13,
4.15, 4.16, 4.17, 4.18, 4.19, 4.20, 4.21 and 4.22 and Article Five with respect
to the outstanding Notes on and after the date the conditions set forth below
are satisfied (hereinafter, "COVENANT DEFEASANCE"), and the Notes shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but
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shall continue to be deemed "outstanding" for all other purposes hereunder
(it being understood that such Notes shall not be deemed outstanding for
accounting purposes). For this purpose, such Covenant Defeasance means that,
with respect to the outstanding Notes, the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation
set forth in any such covenant, whether directly or indirectly, by reason of
any reference elsewhere herein to any such covenant or by reason of any
reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an
Event of Default under Section 6.1(c), but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected thereby. In
addition, upon the Company's exercise under Section 8.1 of the option
applicable to this Section 8.3 and Sections 6.1(d) through 6.1(k) shall not
constitute Events of Default.
SECTION 8.4 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either Section
8.2 or Section 8.3 to the outstanding Notes:
(a) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Notes, (i) cash in U.S. Dollars, (ii)
non-callable U.S. government obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment, cash in U.S.
Dollars, or (iii) a combination thereof, in such amounts, as will be sufficient,
in the opinion of a nationally recognized firm of independent public accountants
selected by the Trustee expressed in a written certification thereof delivered
to the Trustee, which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge the principal of, premium, if any, and interest on
the outstanding Notes on the stated maturity or on the applicable redemption
date, as the case may be, of such principal or installment of principal,
premium, if any, or interest;
(b) In the case of an election under Section 8.2, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably satisfactory to the Trustee confirming that (i) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (ii) since the date hereof, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based thereon
such opinion shall confirm that, the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes
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as a result of such Legal Defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would
have been the case if such Legal Defeasance has not occurred;
(c) In the case of an election under Section 8.3, the Company shall
have delivered to the Trustee an Opinion of Counsel reasonably satisfactory to
the Trustee in the United States to the effect that the Holders of the
outstanding Notes will not recognize income, gain or loss for Federal income tax
purposes as a result of such Covenant Defeasance and will be subject to Federal
income tax on the same amount, in the same manner and at the same times as would
have been the case if such Covenant Defeasance had not occurred;
(d) No Default or Event of Default with respect to the Notes shall
have occurred and be continuing on the date of such deposit or, in so far as
Section 6.1(j) or 6.1(k) is concerned, at any time in the period ending on the
91st day after the date of such deposit;
(e) Such Legal Defeasance or Covenant Defeasance shall 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 or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(f) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit made by the Company pursuant to its
election under Section 8.2 or 8.3 was not made by the Company with the intent of
preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and
(g) The Company shall have delivered to the Trustee an Officers'
Certificate stating that all conditions precedent provided for relating to
either the Legal Defeasance under Section 8.2 or the Covenant Defeasance under
Section 8.3 (as the case may be) have been complied with as contemplated by this
Section 8.4.
SECTION 8.5 DEPOSITED MONEY AND GOVERNMENT NOTES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.6, all money and Government Notes (including the
proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes
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of this Section 8.5, the "Trustee") pursuant to Section 8.4 in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company,
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or Government Notes
deposited pursuant to Section 8.4 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the outstanding Notes.
Anything in this Article Eight to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or Government Notes held by it as PROVIDED in Section 8.4
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee (which may be the opinion delivered under Section 8.4(a)), are in excess
of the amount thereof which would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.6 REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
and premium, if any, or interest has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter, as a secured creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustees thereof, shall thereupon cease; PROVIDED, HOWEVER, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company
SECTION 8.7 REINSTATEMENT.
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If the Trustee or Paying Agent is unable to apply any United States Dollars
or Government Notes in accordance with Section 8.2 or 8.3, as the case may be,
by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.2 or 8.3
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.2 or 8.3, as the case may be; PROVIDED,
HOWEVER, that, if the Company makes any payment of principal of, premium, if
any, or interest on any Note following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.1 WITH CONSENT OF HOLDERS OF NOTES
(a) Except as provided in Section 9.2 hereof, this Indenture and 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 (including consents
obtained in connection with a tender offer or exchange offer for Notes), and any
existing default or compliance with any provision of this Indenture or the Notes
may be waived with the consent of the holders of a majority in principal amount
of the then outstanding Notes (including consents obtained in connection with a
tender offer or exchange offer for Notes).
(b) Without the consent of each holder affected, however, an amendment or
waiver may not (with respect to any Note held by a non-consenting holder):
(i) reduce the aggregate principal amount of Notes whose holders must
consent to an amendment, supplement or waiver;
(ii) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes;
(iii) reduce the rate of or change the time for payment of
interest on any Notes;
(iv) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the holders of at least a majority in
aggregate principal amount
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of the Notes and a waiver of the payment default that resulted from such
acceleration);
(v) make any Note payable in money other than that stated in the
Notes;
(vi) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of holders of Notes to receive
payments of principal of or interest on the Notes;
(vii) waive a redemption payment with respect to any Note; or
(viii) make any change in the foregoing amendment and waiver
provisions.
In addition, without the consent of at least 66 2/3% of the Notes then
outstanding, an amendment or a waiver may not make any change to the covenants
in this Indenture entitled "Offer to Purchase upon Change of Control or Orbital
Event" in Section 4.15 hereof, and "Asset Sales" in Section 4.10 hereof
(including, in each case, the related definitions).
SECTION 9.2 WITHOUT CONSENT OF HOLDERS OF NOTES
(a) Notwithstanding the foregoing, without the consent of any holder of
Notes, the Company and the Trustee may amend or supplement the Indenture and the
Notes to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the Notes
in the case of a merger or consolidation, to make any change that would provide
any additional rights or benefits to the holders of the Notes or that does not
adversely affect the legal rights under this Indenture of any such holder, or to
comply with requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA.
SECTION 9.3 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amended or supplemental Indenture that complies with the TIA as
then in effect.
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SECTION 9.4 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent to
it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Xxxxxx's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment
becomes effective. An amendment, supplement or waiver becomes effective in
accordance with its terms and thereafter binds every Holder of a Note.
The Company may fix a record date for determining which Holders of the
Notes must consent to such amendment, supplement or waiver. If the Company
fixes a record date, the record date shall be fixed at (i) the later of 30 days
prior to the first solicitation of such consent or the date of the most recent
list of Holders of Notes furnished to the Trustee prior to such solicitation
pursuant to Section 2.5 or (ii) such other date as the Company shall designate.
SECTION 9.5 NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall authenticate new Notes
that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.6 TRUSTEE TO SIGN AMENDMENTS, ETC.
(a) The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it.
(b) Upon the request of the Company accompanied by a resolution of the
Board of Directors of the Company authorizing the execution of any such amended
or supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the
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Trustee of the documents described in Section 9.6, the Trustee shall join
with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
(c) It shall not be necessary for the consent of the Holders of Notes to
approve the particular form of any proposed amendment or waiver, but it shall be
sufficient if such consent approves the substance thereof.
(d) After an amendment, supplement or waiver under this Article becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.4 and 6.7, the Holders of a majority
in aggregate principal amount of the Notes then outstanding may waive compliance
in a particular instance by the Company with any provision of this Indenture or
the Notes.
SECTION 9.7 PAYMENTS FOR CONSENTS.
Neither EchoStar, the Company nor any of their Subsidiaries may, directly
or indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of a Note for or as an inducement to
any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or
agreed to be paid to all Holders of the Notes that consent, waive or agree to
amend in the time frame set forth in the solicitation documents relating to
such consent, waiver or agreement.
ARTICLE 10
[INTENTIONALLY OMITTED]
ARTICLE 11
[INTENTIONALLY OMITTED]
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ARTICLE 12
MISCELLANEOUS
SECTION 12.1 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA Section 318(c), the imposed duties shall control.
SECTION 12.2 NOTICES.
Any notice or communication by the Company or the Trustee to the other is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the other's address:
If to the Company:
EchoStar Communications Corporation 00 Xxxxxxxxx Xxxxxx Xxxx Xxxxxxxxx,
Xxxxxxxx 00000 Telecopier No.: (000) 000-0000 Attention: Xxxxx X. Xxxxxxxxx,
Esq.
With a copy to:
Xxxxxxxx Xxxxxxxxx Xxxxxx Xxxxxxx & Xxxxxxxxxxx, LLC, 0000 Xxxxxxx Xxxxx,
Xxxxx Xxxxx, Xxxxxx, Xxxxxxxx 00000, Telecopier No.: (000) 000-0000 Attention:
Xxxxxxx X. Xxxxxxxx, Xx., Esq.
If to the Trustee:
[TO BE PROVIDED]
The Company or the Trustee, by notice to the other may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders of Notes)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
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Any notice or communication to a Holder of a Note shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder of a Note or any defect
in it shall not affect its sufficiency with respect to other Holders of Notes.
If a notice or communication is mailed in the manner PROVIDED above within
the time prescribed, it is duly given, whether or not the addressee receives
it.
If the Company mails a notice or communication to Holders of Notes, it
shall mail a copy to the Trustee and each Agent at the same time.
SECTION 12.3 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders of the Notes may communicate pursuant to TIA Section 312(b) with
other Holders of Notes 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 12.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, PROVIDED for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been satisfied.
SECTION 12.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
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Each certificate or opinion with respect to compliance with a condition or
covenant PROVIDED for in this Indenture (other than a certificate PROVIDED
pursuant to TIA Section 314(a)(4)) shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of 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
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
SECTION 12.6 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders of Notes. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
SECTION 12.7 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES,
INCORPORATORS AND STOCKHOLDERS.
No director, officer, employee, incorporator or stockholder of the Company
DBS Corp or any of their Affiliates, as such, shall have any liability for any
obligations of the Company and any of their Affiliates under the Notes or this
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of the Notes by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.
SECTION 12.8 GOVERNING LAW.
The internal law of the State of New York shall govern and be used to
construe this Indenture and the Notes.
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SECTION 12.9 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or its Subsidiaries. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
SECTION 12.10 SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successor.
SECTION 12.11 SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 12.12 COUNTERPART 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 12.13 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
IN WITNESS WHEREOF, Xxxxxxx and the Trustee have caused this Indenture to
be duly executed as of the day and year first above written.
ECHOSTAR COMMUNICATIONS CORPORATION,
a Nevada corporation
By:
-----------------------
Xxxxx X. Xxxxxxxxx
Senior Vice President,
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General Counsel and Secretary
U.S. BANK TRUST NATIONAL ASSOCIATION
By:
-------------------------------
Trust Officer Corporate Finance
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EXHIBITS
EXHIBIT A UNSECURED NOTES
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