EXHIBIT 4.3
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EXECUTION COPY
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EARTHWATCH INCORPORATED
_____________________
INDENTURE
Dated as of July 12, 1999
_____________________
THE BANK OF NEW YORK,
Trustee
$199,000,000 Principal Amount at Maturity
13% Senior Discount Notes Due 2007
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CROSS-REFERENCE TABLE
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TIA Sections Indenture Sections
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(S) 310 (a)(1)..................................... 7.10
(a)(5)..................................... 7.10
(b)........................................ 7.3,7.8,7.10
(S) 313 (a)........................................ 7.6
(b)........................................ 7.6
(c)........................................ 7.5,7.6
(d)........................................ 7.6
(S) 314 (a)........................................ 4.12,12.2
(a)(4)..................................... 4.12,12.2
(S) 315 (b)........................................ 7.5
(S) 316 (a)(1)(A).................................. 6.5
(a)(1)(B).................................. 6.4
(b)........................................ 6.7
(S) 317 (a)(1)..................................... 6.8
(a)(2)..................................... 6.9
______________________
Note: The Cross-Reference Table shall not for any purpose be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions................................................................... 2
Section 1.2. Incorporation by Reference of Trust Indenture Act............................. 21
Section 1.3. Rules of Construction......................................................... 21
ARTICLE TWO
THE NOTES
Section 2.1. Form and Dating............................................................... 22
Section 2.2. Execution and Authentication.................................................. 23
Section 2.3. Registrar and Paying Agent.................................................... 24
Section 2.4. Holders to Be Treated as Owners; Payments of Interest......................... 25
Section 2.5. Paying Agent to Hold Money in Trust........................................... 25
Section 2.6. Holder Lists.................................................................. 26
Section 2.7. Transfer and Exchange......................................................... 26
Section 2.8. Replacement Notes............................................................. 34
Section 2.9. Outstanding Notes............................................................. 34
Section 2.10. Treasury Notes................................................................ 35
Section 2.11. Temporary Notes............................................................... 35
Section 2.12. Cancellation.................................................................. 35
Section 2.13. Defaulted Interest............................................................ 36
Section 2.14. CUSIP, CINS or ISIN Number.................................................... 36
Section 2.15. Deposit of Moneys............................................................. 36
ARTICLE THREE
REDEMPTION
Section 3.1. Right of Redemption........................................................... 36
Section 3.2. Notices to Trustee............................................................ 37
Section 3.3. Selection of Notes to Be Redeemed............................................. 37
Section 3.4. Notice of Redemption.......................................................... 37
Section 3.5. Effect of Notice of Redemption................................................ 38
Section 3.6. Deposit of Redemption Price................................................... 38
Section 3.7. Payment of Notes Called for Redemption........................................ 39
Section 3.8. Notes Redeemed in Part........................................................ 39
_________________
Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
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ARTICLE FOUR
COVENANTS
Section 4.1. Payment of Notes.............................................................. 39
Section 4.2. Limitation on Indebtedness.................................................... 39
Section 4.3. Limitation on Restricted Payments............................................. 42
Section 4.4. Limitation on Liens........................................................... 43
Section 4.5. Limitation on Sale-Leaseback Transactions..................................... 44
Section 4.6. Maintenance of Office or Agency............................................... 44
Section 4.7. Repurchase of Notes upon a Change of Control.................................. 44
Section 4.8. Existence..................................................................... 45
Section 4.9. Payment of Taxes and Other Claims............................................. 45
Section 4.10. Maintenance of Properties and Insurance....................................... 45
Section 4.11. Rating of Notes............................................................... 47
Section 4.12. Repurchase of Notes upon an Insurance Proceeds Payment........................ 47
Section 4.13. Compliance Certificates....................................................... 48
Section 4.14. Notice of Defaults............................................................ 48
Section 4.15. Commission Reports and Reports to Holders..................................... 48
Section 4.16. Waiver of Stay, Extension or Usury Laws....................................... 49
Section 4.17. Other Consents................................................................ 49
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.1. Consolidation. Merger and Sale of Assets...................................... 49
Section 5.2. Successor Substituted......................................................... 50
ARTICLE SIX
DEFAULT AND REMEDIES
Section 6.1. Events of Default............................................................. 50
Section 6.2. Acceleration.................................................................. 52
Section 6.3. Other Remedies................................................................ 52
Section 6.4. Waiver of Past Defaults....................................................... 52
Section 6.5. Control by Majority........................................................... 53
Section 6.6. Limitation on Suits........................................................... 53
Section 6.7. Rights of Holders to Receive Payment.......................................... 53
Section 6.8. Collection of Indebtedness and Suits for Enforcement by Trustee............... 54
_________________
Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
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Section 6.9. Trustee May File Proofs of Claim.............................................. 54
Section 6.10. Priorities.................................................................... 55
Section 6.11. Undertaking for Costs......................................................... 55
Section 6.12. Restoration of Rights and Remedies............................................ 56
Section 6.13. Rights and Remedies Cumulative................................................ 56
Section 6.14. Delay or Omission Not Waiver.................................................. 56
ARTICLE SEVEN
TRUSTEE
Section 7.1. General....................................................................... 56
Section 7.2. Certain Rights of Trustee..................................................... 56
Section 7.3. Individual Rights of Trustee.................................................. 58
Section 7.4. Trustee's Disclaimer.......................................................... 58
Section 7.5. Notice of Default............................................................. 58
Section 7.6. Reports by Trustee to Holders................................................. 59
Section 7.7. Compensation and Indemnity.................................................... 59
Section 7.8. Replacement of Trustee........................................................ 59
Section 7.9. Successor Trustee by Merger, Etc ............................................. 60
Section 7.10. Eligibility................................................................... 61
Section 7.11. Money Held in Trust........................................................... 61
Section 7.12. Withholding Taxes............................................................. 61
ARTICLE EIGHT
DISCHARGE OF INDENTURE
Section 8.1. Termination of Company's Obligations.......................................... 61
Section 8.2. Defeasance of Certain Obligations............................................. 62
Section 8.3. Application of Trust Money.................................................... 64
Section 8.4. Repayment to Company.......................................................... 64
Section 8.5. Reinstatement................................................................. 64
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1. Without Consent of Holders.................................................... 65
Section 9.2. With Consent of Holders....................................................... 65
Section 9.3. Revocation and Effect of Consent.............................................. 67
Section 9.4. Notation on or Exchange of Notes.............................................. 67
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Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
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Section 9.5. Trustee to Sign Amendments, Etc............................................... 67
Section 9.6. Conformity with Trust Indenture Act........................................... 67
Section 9.7. Payments for Consent.......................................................... 67
ARTICLE TEN
SECURITY
Section 10.1. Security...................................................................... 68
ARTICLE ELEVEN
INTENTIONALLY OMITTED
ARTICLE TWELVE
MISCELLANEOUS
Section 12.1. Trust Indenture Act of 1939................................................... 69
Section 12.2. Notices....................................................................... 69
Section 12.3. Certificate and Opinion as to Conditions Precedent............................ 71
Section 12.4. Statements Required in Certificate or Opinion................................. 71
Section 12.5. Acts of Holders............................................................... 71
Section 12.6 Rules by Trustee, Paying Agent or Registrar................................... 72
Section 12.7. Agent for Service; Submission to Jurisdiction; Waiver of Immunities........... 72
Section 12.8. Payment Date Other than a Business Day........................................ 73
Section 12.9. Governing Law................................................................. 73
Section 12.10. No Adverse Interpretation Other Agreements.................................... 73
Section 12.11. No Recourse Against Others.................................................... 73
Section 12.12. Successors.................................................................... 74
Section 12.13. Duplicate Originals........................................................... 74
Section 12.14. Separability.................................................................. 74
Section 12.15. Table of Contents, Headings, Etc.............................................. 74
EXHIBIT A Form of Global Note........................................................... A-1
EXHIBIT B Form of Definitive Registered Note............................................ B-1
EXHIBIT C Form of Certificate of Transfer............................................... C-1
EXHIBIT D Form of Certificate of Exchange............................................... D-I
EXHIBIT E Form of Certificate from Acquiring Institutional Accredited Investor.......... E-1
_________________
Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
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INDENTURE, dated as of July 12, 1999, between EARTHWATCH INCORPORATED,
a Delaware corporation (together with its successors and assigns, the
"Company"), as issuer, and The Bank of New York, a New York banking corporation,
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trustee (the "Trustee").
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RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance initially of up to $199,000,000 aggregate
principal amount at maturity of the Company's 13% Senior Discount Notes due 2007
(the "Notes") issuable as provided in this Indenture. Pursuant to the terms of a
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Placement Agreement dated as of July 7, 1999 (the "Placement Agreement"), the
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Company has agreed to issue and sell 199,000 units (the "Units"), each Unit
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consisting of one of its $1,000 principal amount at maturity of the Notes and
49.095 shares of 8.5% Series C Cumulative Convertible Redeemable Preferred Stock
(the "Preferred Stock"), par value $.001 per share. All things necessary to make
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this Indenture a valid agreement of the Company, in accordance with its terms,
have been done, and the Company has done all things necessary to make the Notes,
when executed by the Company and authenticated and delivered by the Trustee
hereunder and duly issued by the Company, valid obligations of the Company as
hereinafter provided.
The Notes and the Preferred Stock will become automatically separated
upon the date (the "Separation Date") which is the earliest to occur of (i) the
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date that is six months after the Closing Date; (ii) the commencement of the
exchange offer for the Notes; (iii) the effectiveness of a Shelf Registration
Statement with respect to the Notes; and (iv) a date determined by Xxxxxx
Xxxxxxx & Co. Incorporated in its sole discretion.
An amount equal to the original principal amount of the Notes plus
accrued interest for the period from the Closing Date through the earlier of
June 30, 2000 and the date that the first QuickBird Satellite is launched shall
be secured by the First QuickBird Launch Insurance.
This Indenture is subject to, and shall be governed by, the provisions
of the United States Trust Indenture Act of 1939, as amended, that are required
to be a part of and to govern indentures qualified thereunder.
For and in consideration of the premises and the purchase of the Notes
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders, as follows:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions.
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"144A Book-Entry Interests" means the Book-Entry Interests in the
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144A Global Note.
"144A Global Note" means the Global Note bearing the Private Placement
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Legend, without interest coupons, that shall be issued in a denomination equal
to the outstanding principal amount at maturity of the Notes sold in reliance on
Rule 144A and deposited with the Trustee, as custodian for the Depositary.
"Accreted Value" means, for any Specified Date, the amount provided
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below for each $1,000 principal amount at maturity of Notes: (i) if the
Specified Date occurs on one of the following semiannual dates, the Accreted
Value shall equal the amount set forth below for such semiannual accrual date:
Semiannual Accrual Date Accreted Value
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January 15, 2000................... $ 729.88
July 15, 2000...................... $ 777.32
January 15, 2001................... $ 827.84
July 15, 2001...................... $ 881.65
January 15, 2002................... $ 938.96
July 15, 2002...................... $1.000.00
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(ii) if the Specified Date occurs before the first semiannual accrual date, the
Accreted Value shall equal the sum of (a) $684.61, and (b) an amount equal to
the product of: (1) the Accreted Value for the first semiannual accrual date
less $684.61 multiplied by (2) a fraction, the numerator of which is the number
of days from the Closing Date to the Specified Date, using a 360-day year of
twelve 30-day months, and the denominator of which is the number of days from
the Closing Date to the first semiannual accrual date, using a 360-day year of
twelve 30-day months; (iii) if the Specified Date occurs between two semiannual
accrual dates, the Accreted Value shall equal the sum of: (a) the Accreted Value
for the semiannual accrual date immediately preceding such Specified Date and
(b) an amount equal to the product of (1) the Accreted Value for the immediately
following semiannual accrual date less the Accreted Value for the immediately
preceding semiannual accrual date multiplied by (2) a fraction, the numerator of
which is the number of days from the immediately preceding semiannual accrual
date to the Specified Date, using a 360-day year of twelve 30-day months, and
the denominator of which is 180; or (iv) if the Specified Date occurs after the
last semiannual accrual date, the Accreted Value shall equal $1,000.
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"Accretion Interest payment Date: means any Interest payment Date
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occurring prior to (and not including) the Interest Payment Date of July 15,
2004.
"Acquired Indebtedness" means Indebtedness of a Person existing at the
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time such Person becomes a Subsidiary of the Company or assumed in connection
with an Asset Acquisition by a Subsidiary of the Company and not Incurred in
connection with, or in anticipation of, such Person becoming a Subsidiary of the
Company or such Asset Acquisition.
"Adjusted Consolidated Net Income" means, for any period, the
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aggregate net income (or loss) of the Company and its Subsidiaries for such
period determined in conformity with GAAP; provided that the following items
shall be excluded in computing Adjusted Consolidated Net Income (without
duplication): (i) the net income of any Person (other than net income
attributable to a Subsidiary) in which any Person (other than the Company or any
of its Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to the Company or any of its
Subsidiaries by such other Person during such period; (ii) except to the extent
includable pursuant to clause (i) above, the net income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary or is merged into or
consolidated with the Company or any of its Subsidiaries or all or substantially
all of the property and assets of such Person are acquired by the Company or any
of its Subsidiaries; (iii) the net income of any Subsidiary (determined by
excluding income resulting from transfers of assets by the Company or a
Subsidiary to another Subsidiary) to the extent that the declaration or payment
of dividends or similar distributions by such Subsidiary of such net income is
not at the time permitted by the operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Subsidiary; (iv) any gains or losses (on an
after-tax basis) attributable to Asset Sales; and (v) all extraordinary gains
and extraordinary losses. Calculations for the purpose of determining compliance
with the terms of the covenants and with other provisions of this Indenture
shall be made without giving effect to (i) the amortization of any expenses
incurred in connection with the offering of the Notes and (ii) except as
otherwise provided, the amortization of any amounts required or permitted by
Accounting Principles Board Opinion Nos. 16 and 17.
"Affiliate" means, as applied to any Person, any other Person directly
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or indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled
by" and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Paying Agent, authenticating agent or co-
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Registrar.
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"Applicable Procedures" means, with respect to any transfer or
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exchange of Book-Entry Interests, the rules and procedures of the Depositary
that apply to such transfer or exchange.
"Asset Acquisition" means: (1) an investment by the Company or any of
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its Subsidiaries in any other Person pursuant to which such Person shall become
a Subsidiary of the Company or shall be merged into or consolidated with the
Company or any of its Subsidiaries; provided that such Person's primary business
is related, ancillary or complementary to the businesses of the Company and its
Subsidiaries on the date of such investment; or (2) an acquisition by the
Company or any of its Subsidiaries of the property and assets of any Person
other than the Company or any of its Subsidiaries that constitute substantially
all of a division or line of business of such Person; provided that the property
and assets acquired are related, ancillary or complementary to the businesses of
the Company and its Subsidiaries on the date of such acquisition.
"Asset Disposition" means the sale or other disposition by the Company
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or any of its Subsidiaries (other than to the Company or to one of its
Subsidiaries) of: (1) all or substantially all of the Capital Stock of any of
the Company's Subsidiaries or; (2) all or substantially all of the assets that
constitute a division or line of business of the Company or any of its
Subsidiaries.
"Asset Sale" means any sale, transfer or other disposition (including
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by way of merger, consolidation or sale-leaseback transaction) in one
transaction or a series of related transactions by the Company or any of its
Subsidiaries to any Person other than the Company or any of its Subsidiaries of
(i) all or any of the Capital Stock of any Subsidiary, (ii) all or substantially
all of the property and assets of an operating unit or business of the Company
or any of its Subsidiaries or (iii) any other property and assets of the Company
or any of its Subsidiaries outside the ordinary course of business of the
Company or such Subsidiary and, in each case, that is not governed by the
provisions of the Indenture applicable to mergers, consolidations and sales of
assets of the Company; provided that "Asset Sale" shall not include (a) sales or
other dispositions of inventory, receivables and other current assets or (b)
sales or other dispositions of assets for consideration at least equal to the
fair market value of the assets sold or disposed of.
"Average Life " means, at any date of determination with respect to
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any debt security, the quotient obtained by dividing: (1) the sum of the
products of: (a) the number of years from such date of determination to the
dates of each successive scheduled principal payment of such debt security and
(b) the amount of such principal payment by (2) the sum of all such principal
payments.
"Board of Directors" means the Board of Directors of the Company or
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any committee of such Board of Directors duly authorized to act with respect to
this Indenture from time to time.
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"Board Resolution" means a copy of a resolution, certified by any
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Director of the Company or the Secretary or Assistant Secretary of the Company
to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification and delivered to the Trustee.
"Book-Entry Interest" means an indirect beneficial interest in the
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Global Note held through a corresponding Depositary Interest and shown on, and
transferred only through, records maintained in book-entry form by the
Depositary (with respect to the Participants) and its Participants.
"Business Day" means a day except Saturday, Sunday or other day on
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which commercial banks in the City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.
"Capital Stock" means, with respect to any Person, any and all shares,
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interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether outstanding on or issued
after the Closing Date, including, without limitation, all Common Stock and
Preferred Stock.
"Capitalized Lease" means, as applied to any Person, any lease of any
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property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such Person as Lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person; and "Capitalized
Lease Obligations" means the discounted present value of the rental obligations
under such lease.
"Certificated Note" means a certificated Note registered in the name
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of the Holder thereof and issued in accordance with Section 2.7(a) hereof,
substantially in the form of Exhibit B hereto.
"Change of Control" means such time as (i) a "person" or "group"
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(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act), other
than the Permitted Holders (in each case together with their respective
Affiliates) becomes the ultimate "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) of more than 35% of the total voting power of the Voting
Stock of the Company on a fully diluted basis and such ownership is greater than
the amount of voting power of the Voting Stock of the Company, on a fully
diluted basis, held by the Permitted Holders and their respective Affiliates on
such date; or (ii) individuals who on the Closing Date constitute the Board of
Directors (together with any new directors whose election by the Board of
Directors or whose nomination by the Board of Directors for election by the
Company's stockholders was either (x) approved by a vote of at least two-thirds
of the members of the Board of Directors then in office who either were members
of the Board of Directors on the Closing Date or whose election or nomination
for election was previously so approved or (y) implemented pursuant to Section
2.1 of the Stockholders' Agreement) cease for any reason to constitute a
majority of the members of the Board of Directors then in office.
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"Chief Executive Officer" of the Company means Xxxxxxx X. Xxxxxxxxx,
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III or, in the event of his death or termination of his office, such other
Officer of the Company as the Company may designate.
"Closing Date " means July 12, 1999, the actual date on which the
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Notes are issued under this Indenture.
"Collateral" means the First QuickBird Launch Insurance and the other
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collateral described in the Security Documents.
"Collateral Trustee" means, pursuant to the Security Documents, the
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Trustee or any successor or substitute collateral trustee for the Collateral and
with respect to the Notes and the 12 1/2% Notes under the Security Documents.
"Commission" means the United States Securities and Exchange
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Commission, as from time to time constituted, created under the Exchange Act or,
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the TIA, then the
body performing such duties at such time.
"Common Stock" means the shares of Common Stock, par value $.001 per
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share, of the Company.
"Company" means EarthWatch Incorporated, a Delaware corporation, until
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a successor replaces it pursuant to Article Five of this Indenture and
thereafter means such successor.
"Company Order" means a written request or order signed in the name of
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the Company (i) by the Chairman of the Board, the Chief Executive Officer, the
President or any Director and (ii) by its Chief Financial Officer, Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary and delivered to
the Trustee; provided, however, that such written request or order may be signed
by any two of the officers or directors listed in clause (i) above in lieu of
being signed by one of such officers or directors listed in such clause (i) and
one of the officers listed in clause (ii) above.
"Consolidated EBITDA" means, for any period, Adjusted Consolidated Net
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Income for such period plus, to the extent such amount was deducted in
calculating such Adjusted Consolidated Net Income: (1) Consolidated Interest
Expense; (2) income taxes (other than income taxes (either positive or negative)
attributable to extraordinary and non-recurring gains or losses or sales of
assets); (3) depreciation expense; (4) amortization expense; and (5) all other
non-cash items reducing Adjusted Consolidated Net Income (other than items that
will require cash payments and for which an accrual or reserve is, or is
required by GAAP to be, made), less all non-cash items increasing Adjusted
Consolidated Net Income, all as determined on a consolidated basis for the
Company and its Subsidiaries in conformity with GAAP;
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provided that, if any Subsidiary of the Company is not a Wholly Owned
Subsidiary, Consolidated EBITDA shall be reduced (to the extent not otherwise
reduced in accordance with GAAP) by an amount equal to (A) the amount of the
Adjusted Consolidated Net Income attributable to such Subsidiary multiplied by
(B) the percentage ownership interest in the income of such Subsidiary not owned
on the last day of such period by the Company or any of its Subsidiaries.
"Consolidated Interest Expense" means, for any period, the aggregate
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amount of interest in respect of Indebtedness (including, without limitation,
amortization of original issue discount on any Indebtedness and the interest
portion of any deferred payment obligation, calculated in accordance with the
effective interest method of accounting; all commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers' acceptance
financing; the net costs associated with Interest Rate Agreements; and
Indebtedness that is Guaranteed or secured by the Company or any of its
Subsidiaries) and all but the principal component of rentals in respect of
Capitalized Lease Obligations paid, accrued or scheduled to be paid or to be
accrued by the Company and its Subsidiaries during such period; excluding,
however: (1) any amount of such interest of any Subsidiary of the Company if
the net income of such Subsidiary of the Company is excluded in the calculation
of Adjusted Consolidated Net Income pursuant to clause (3) of the definition
thereof (but only in the same proportion as the net income of such Subsidiary is
excluded from the calculation of Adjusted Consolidated Net Income pursuant to
clause (3) of the definition thereof); and (2) any premiums, fees and expenses
(and any amortization thereof) payable in connection with the offering of the
Units, all as determined on a consolidated basis (without taking into account
the Subsidiaries of the Company) in conformity with GAAP.
"Consolidated Leverage Ratio " means, on any Transaction Date, the
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ratio of: (1) the aggregate amount of Indebtedness of the Company and its
Subsidiaries on a consolidated basis outstanding on such Transaction Date to:
(2) the aggregate amount of Consolidated EBITDA for the then most recent four
fiscal quarters for which financial statements of the Company have been filed
with the SEC or provided to the Trustee pursuant to the "Commission Reports and
Reports to Holders" covenant described below (such four fiscal quarter period
being the "Four Quarter Period"); provided that, in making the foregoing
calculation: (A) pro forma effect shall be given to any Indebtedness to be
Incurred or repaid on the Transaction Date; (B) pro forma effect shall be given
to Asset Dispositions and Asset Acquisitions (including giving pro forma effect
to the application of proceeds of any Asset Disposition) that occur from the
beginning of the Four Quarter Period through the Transaction Date (the
"Reference Period"), as if they had occurred and such proceeds had been applied
on the first day of such Reference Period; and (C) pro forma effect shall be
given to asset dispositions and asset acquisitions (including giving pro forma
effect to the application of proceeds of any asset disposition) that have been
made by any Person that has become a Subsidiary of the Company or has been
merged with or into the Company or any of its Subsidiaries during such Reference
Period and that would have constituted Asset Dispositions or Asset Acquisitions
had such transactions occurred when such Person was a Subsidiary as if such
asset dispositions or asset acquisitions were Asset
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Dispositions or Asset Acquisitions that occurred on the first day of such
Reference Period; provided that to the extent that clause (B) or (C) of this
sentence requires that pro forma effect be given to an Asset Acquisition or
Asset Disposition, such pro forma calculation shall be based upon the four full
fiscal quarters immediately preceding the Transaction Date of the Person, or
division or line of business of the Person, that is acquired or disposed of for
which financial information is available.
"Corporate Trust Office" means the office of the Trustee at which the
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corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Currency Agreement" means any foreign exchange contract, currency
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swap agreement or other similar agreement or arrangement designed to protect the
Company or any Subsidiary against fluctuations in currency values.
"Default" means any event that is, or after notice or passage of time
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or both would be, an Event of Default.
"Definitive Registered Note" means a certificated Note registered in
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the name of the Holder thereof and issued in accordance with Section 2.7 hereof,
substantially in the form of Exhibit B hereto.
"Depositary" shall mean the DTC, its nominees and their respective
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successors.
"Depositary Interest" means a certificateless depositary interest
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representing a 100% beneficial interest in the Global Note.
"DTC" means The Depository Trust Company.
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"Event of Default" has the meaning provided in Section 6.1.
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"Exchange Act" means the United States Securities Exchange Act of
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1934, as amended.
"Exchange Note" means any securities of the Company containing terms
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identical to the Notes (except that such Exchange Notes shall be registered
under the Securities Act) that are issued and exchanged for the Notes pursuant
to the Registration Rights Agreement and this Indenture.
"fair market value" means the price that would be paid in an arm's-
-----------------
length transaction between an informed and willing seller under no compulsion to
sell and an informed and willing buyer under no compulsion to buy, as determined
in good faith by the Board of
8
Directors, whose determination shall be conclusive if evidenced by a Board
Resolution; provided that for purposes of clause (viii) of the second paragraph
of 4.1 hereof, (x) the fair market value of any security registered under the
Exchange Act shall be the average of the closing prices, regular way, of such
security for the 20 consecutive trading days immediately preceding the sale of
Capital Stock and (y) in the event the aggregate fair market value of any other
property (other than cash or cash equivalents) received by the Company exceeds
$10,000,000, the fair market value of such property shall be determined by a
nationally recognized investment banking firm and set forth in their written
opinion which shall be delivered to the Trustee.
"First QuickBird Launch Insurance" means launch and in-orbit
--------------------------------
operations insurance in respect of the First QuickBird Satellite, having the
terms and provisions described in Section 4.9(b) and being in form and substance
acceptable to the Collateral Trustee.
"First QuickBird Satellite" means the QuickBird I spacecraft
-------------------------
manufactured pursuant to the contract dated June 9, 1998, between Ball Aerospace
& Technologies Corp. and the Company, for QuickBird Spacecraft number
SE.IM.PRJ.0004.A, including amendments and exhibits attached thereto, and
related attached components and equipment.
"GAAP" means generally accepted accounting principles in the United
----
States of America as in effect as of the Closing Date, including, without
limitation, those set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession. All ratios and computations contained or referred
to in the Indenture shall be computed in conformity with GAAP applied on a
consistent basis.
"Global Note" means the Restricted Global Note substantially in the
-----------
form of Exhibit A hereto issued in accordance with Section 2.1 hereof.
"Government Securities" means direct obligations of, obligations fully
---------------------
guaranteed by, or participations in pools consisting solely of obligations of or
obligations guaranteed by, the United States of America for the payment of which
guarantee or obligations the full faith and credit of the United States of
America is pledged and which are not callable or redeemable at the option of the
issuer thereof.
"Guarantee" means any obligation, contingent or otherwise, of any
---------
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation of such other Person (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for purposes of assuring in any
other manner the obligee of such Indebtedness or other obligation of
9
the payment thereof or to protect such obligee against loss in respect thereof
(in whole or in part) or other obligation (in whole or in part); provided that
the term Guarantee" shall not include endorsements for collection or deposit in
the ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Holder" means (a) in the case of any Global Note, the bearer thereof.
------
which shall initially be the Depositary, and (b) in the case of any Definitive
Registered Note, the Person in whose name such Note is registered in the
Register.
"Incur" means, with respect to any Indebtedness, to incur, create,
-----
issue, assume, Guarantee or otherwise become liable for or with respect to, or
become responsible for, the payment of, contingently or otherwise, such
Indebtedness, including an "Incurrence" by means of the acquisition of more than
50% of the Capital Stock of any Person; provided that neither the accrual of
interest nor the accretion of original issue discount shall be considered an
Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person at any date of
------------
determination (without duplication), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all obligations of such
Person in respect of letters of credit or other similar instruments (including
reimbursement obligations with respect thereto, but excluding obligations with
respect to letters of credit (including trade letters of credit) securing
obligations (other than obligations described in clause (i) or (ii) above or
clause (v), (vi) or (vii) below) entered into in the ordinary course of business
of such Person to the extent such letters of credit are not drawn upon or, if
drawn upon, to the extent such drawing is reimbursed no later than the third
Business Day following receipt by such Person of a demand for reimbursement),
(iv) all obligations of such Person to pay the deferred and unpaid purchase
price of property or services, which purchase price is due more than six months
after the date of placing such property in service or taking delivery and title
thereto or the completion of such services, except Trade Payables, (v) all
obligations of such Person as lessee under a Capitalized Lease, (vi) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; provided that the
amount of such Indebtedness shall be the lesser of (A) the fair market value of
such asset at such date of determination and (B) the amount of such
Indebtedness, (vii) all Indebtedness of other Persons Guaranteed by such Person
to the extent such Indebtedness is Guaranteed by such Person and (viii) to the
extent not otherwise included in this definition, obligations under Currency
Agreements and Interest Rate Agreements. The amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date (or, in the
case of a revolving credit or other similar facility, the total amount of funds
outstanding and/or available on the date of determination) of all unconditional
obligations as described above and, with respect to contingent obligations, the
maximum liability upon the occurrence of the contingency giving rise to the
obligation; provided (A) that the amount outstanding at any time of any
Indebtedness issued with original issue discount is the face amount of such
Indebtedness less the remaining unamortized portion of the original issue
discount of such Indebtedness at the time
10
of its issuance as determined in conformity with GAAP and (B) that Indebtedness
shall not include any liability for federal, state, local or other taxes.
"Indenture" means this Indenture as originally executed on the Closing
---------
Date or as it may be amended or supplemented from time to time by one or more
indentures supplemental to this Indenture entered into pursuant to the
applicable provisions of this Indenture.
"Indirect Participant" means a Person who holds an interest through a
--------------------
Participant.
"Insurance Proceeds Payment Amount means the amount of proceeds, if
---------------------------------
any, received by the Collateral Trustee under First QuickBird Launch Insurance."
"Institutional Accredited Investor" shall mean an institution that is
---------------------------------
an "accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act.
"Interest Payment Date" means each semiannual interest payment date
---------------------
of January 15 and July 15 of each year, commencing January 15, 2003.
"Interest Rate Agreement" means any interest rate protection
-----------------------
agreement, interest rate future agreement, interest rate option agreement,
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedge agreement or other similar agreement or
arrangement designed to protect the Company or any of its Subsidiaries against
fluctuations in interest rates in respect of Indebtedness to or under which the
Company or any of its Subsidiaries is a party or a beneficiary on the Closing
Date or becomes a party or a beneficiary hereafter; provided that the notional
principal amount thereof does not exceed the principal amount of the
Indebtedness of the Company and its Subsidiaries that bears interest at floating
rates.
"Investment" in any Person means (i) any direct or indirect advance,
----------
loan or other extension of credit (including, without limitation, by way of
Guarantee or similar arrangement; but excluding advances to customers in the
ordinary course of business that are, in conformity with GAAP, recorded as
accounts receivable on the balance sheet of the Company or its Subsidiaries); or
(ii) any capital contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others), or any purchase or acquisition of Capital Stock, bonds, Notes,
debentures or other similar instruments issued by, such Person, and shall also
include the fair market value of the Capital Stock (or any other Investment),
held by the Company or any of its Subsidiaries, of (or in) any Person that has
ceased to be a Subsidiary.
"Lien" means any mortgage, pledge, security interest, encumbrance,
----
lien or charge of any kind (including, without limitation, any conditional sale
or other title retention agreement or lease in the nature thereof or any
agreement to give any security interest).
11
"Maturity Date" means July 15, 2007.
-------------
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
-------
"Net Cash Proceeds" means (a) with respect to any Asset Sale, the
-----------------
proceeds of such Asset Sale in the form of cash or cash equivalents, including
payments in respect of deferred payment obligations (to the extent
corresponding to the principal, but not interest, component thereof) when
received in the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to the Company or any
Subsidiary), and proceeds from the conversion of other property received when
converted to cash or cash equivalents, net of (i) brokerage commissions and
other fees and expenses (including fees and expenses of counsel and investment
bankers) related to such Asset Sale, (ii) provisions for all taxes (whether or
not such taxes shall actually be paid or are payable) as a result of such Asset
Sale without regard to the consolidated results of operations of the Company and
its Subsidiaries, taken as a whole, (iii) payments made to repay Indebtedness or
any other obligation outstanding at the time of such Asset Sale that either (A)
is secured by a Lien on the property or assets sold or (B) is required to be
paid as a result of such sale and (iv) appropriate amounts to be provided by the
Company or any Subsidiary of the Company as a reserve against any liabilities
associated with such Asset Sale, including, without limitation, pension and
other post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as determined in conformity with GAAP and (b) with respect
to any issuance or sale of Capital Stock, the proceeds of such issuance or sale
in the form of cash or cash equivalents, including payments in respect of
deferred payment obligations (to the extent corresponding to the principal, but
not interest, component thereof) when received in the form of cash or cash
equivalents (except to the extent such obligations are financed or sold with
recourse to the Company or any Subsidiary of the Company), and proceeds from the
conversion of other property received when converted to cash or cash
equivalents, net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees incurred in connection with such issuance or sale and net of taxes
paid or payable as a result thereof.
"Notes" means the 13% Senior Discount Notes due 2007 of the Company
-----
issued pursuant to this Indenture. For all purposes of this Indenture, the term
"Notes" shall include the Notes initially issued on the Closing Date, any
Exchange Notes to be issued and exchanged for any Notes pursuant to the
Registration Rights Agreement and this Indenture and any other Notes issued
after the Closing Date under this Indenture.
"Offer to Purchase" means an offer to purchase Notes by the Company
-----------------
from the Holders commenced by mailing a notice to the Trustee and each Holder
stating: (i) that all Notes validly tendered shall be accepted for payment; (ii)
the purchase price and the Payment Date; (iii) that any Note not tendered shall
continue to accrue interest or original issue discount, as applicable, pursuant
to its terms; (iv) that, unless the Company defaults in the payment of the
purchase price, any Note accepted for payment pursuant to the Offer to Purchase
shall cease to
12
accrue interest or original issue discount, as applicable, on and after the
Payment Date; (v) that Holders electing to have a Note purchased pursuant to
the Offer to Purchase shall be required to surrender the Note, together with the
form entitled "Option of the Holder to Elect Purchase" on the reverse side of
the Note completed, to the Paying Agent at the address specified in the notice,
prior to the close of business on the Business Day immediately preceding the
Payment Date; (vi) that Holders shall be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a facsimile transmission or
letter setting forth the name of such Holder, the principal amount of Notes
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Notes purchased; and (vii) that Holders whose Notes are
being purchased only in part shall be issued new Notes equal in principal amount
to the unpurchased portion of the Notes surrendered; provided that each Note
purchased and each new Note issued shall be in a principal amount at maturity of
$1,000 or integral multiples thereof. On the Payment Date, the Company shall (i)
accept for payment on a pro rata basis Notes or portions thereof tendered
pursuant to an Offer to Purchase; (ii) deposit with the Paying Agent money
sufficient to pay the purchase price of all Notes or portions thereof so
accepted; and (iii) deliver, or cause to be delivered, to the Trustee all Notes
or portions thereof so accepted, together with an Officers' Certificate
specifying the Notes or portions thereof accepted for payment by the Company.
The Paying Agent shall promptly mail to the Holders of Notes so accepted payment
in an amount equal to the purchase price, and the Trustee shall promptly
authenticate and mail to such Holders a new Note equal in principal amount to
any unpurchased portion of the Note surrendered; provided that each Note
purchased and each new Note issued shall be in a principal amount at maturity of
$1,000 or integral multiples thereof. The Company shall publicly announce the
results of an Offer to Purchase as soon as practicable after the Payment Date.
The Trustee shall act as the Paying Agent for an Offer to Purchase. The Company
shall comply with Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable, in the event that the Company is required to repurchase Notes
pursuant to an Offer to Purchase.
"Officer" means, with respect to the Company, (i) the Chairman of the
-------
Board, the Chief Executive Officer, the President or any other Director of the
Company or (ii) the Chief Financial Officer, the Treasurer or any Assistant
Treasurer, the Company Secretary or any Company Assistant Secretary.
"Officers' Certificate" means a certificate signed by one Officer
---------------------
listed in clause (i) of the definition thereof and one Officer listed in clause
(ii) of the definition thereof; provided, however, that any such certificate may
be signed by any two of the Officers listed in clause (i) of the definition
thereof in lieu of being signed by one Officer listed in clause (i) of the
definition thereof and one Officer listed in clause (ii) of the definition
thereof. Each Officers' Certificate (other than certificates provided pursuant
to TIA Section 314(a)(4)) shall include the statements provided for in TIA
Section 314(e), if applicable.
13
"Opinion of Counsel" means a written opinion signed by legal counsel
------------------
who may be an employee of or counsel to the Company. Each such Opinion of
Counsel shall include the statements provided for in TIA Section 314(e), if
applicable.
"Participant" means, with respect to DTC, Euroclear or Cedel, a Person
-----------
who has an account with DTC. Euroclear or Cedel, respectively (and, with respect
to DTC, shall include Euroclear and Cedel).
"Paying Agent" has the meaning provided in Section 2.3, except that,
------------
for the purposes of Article Eight, the Paying Agent shall not be the Company or
a Subsidiary of the Company or an Affiliate of any of them. The term "Paying
Agent" includes any additional Paying Agent.
"Payment Date" means the date of purchase in connection with an Offer
------------
to Purchase, which day shall be a Business Day no earlier than 30 days nor later
than 60 days from the date that notice of such Offer to Purchase is mailed.
"Permitted Holders" means Xxxxxx Xxxxxxx & Co. Incorporated, American
-----------------
High Income Trust, American Variable Insurance Series Asset Allocation Fund,
American Variable Insurance Series Bond Fund, American Variable Insurance Series
High-Yield Bond Fund, The Bond Fund of America, Inc., ITT Industries, Inc. and
Ball Technology Holdings Corp.
"Permitted Investment" means (i) an Investment in the Company or a
--------------------
Subsidiary or a Person which shall, upon the making of such Investment, become a
Subsidiary or be merged or consolidated with or into or transfer or convey all
or substantially all its assets to, the Company or a Subsidiary; provided that
such person's primary business is related, ancillary or complementary to the
businesses of the Company and its Subsidiaries on the date of such Investment;
(ii) Temporary Cash Investments; (iii) payroll, travel and similar advances to
cover matters that are expected at the time of such advances ultimately to be
treated as expenses in accordance with GAAP; (iv) stock, obligations or
securities received in satisfaction of judgments; and (v) Investments in
Currency Agreements and Interest Rate Agreements to the extent that such
Investments relate to actual obligations owed by or owed to the Company or any
Subsidiary and the face or notional amount of such Investment does not exceed
the amount of the underlying obligation to which such Investment relates.
"Permitted Liens" means (i) Liens for taxes, assessments, governmental
---------------
charges or claims that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made; (ii) statutory and common law Liens of landlords and
carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other
similar Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate
14
provision, if any, as shall be required in conformity with GAAP shall have been
made, (iii) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security; (iv) Liens incurred or deposits made to secure the
performance of tenders, bids, leases, statutory or regulatory obligations,
bankers' acceptances, surety and appeal bonds, government contracts, performance
and return-of-money bonds and other obligations of a similar nature incurred in
the ordinary course of business (exclusive of obligations for the payment of
borrowed money); (v) easements, rights-of-way, municipal and zoning ordinances
and similar charges, encumbrances, title defects or other irregularities that do
not materially interfere with the ordinary course of business of the Company or
any of its Subsidiaries; (vi) Liens (including extensions and renewals thereof)
upon real or personal property acquired after the Closing Date; provided that
(a) any such Lien is created solely for the purpose of securing indebtedness
incurred (1) to finance the cost (including the cost of improvement or
construction) of the item of property or assets subject thereto and such Lien is
created prior to, at the time of or within six months after the latest of the
acquisition, the completion of construction or the commencement of full
operation of such property or (2) to refinance any indebtedness previously so
secured, (b) the principal amount of the Indebtedness secured by such Lien does
not exceed 100% of such cost and (c) any such Lien shall not extend to or cover
any property or assets other than such item of property or assets and any
improvements on such item; (vii) leases or subleases granted to others that do
not materially interfere with the ordinary course of business of the Company and
its Subsidiaries, taken as a whole; (viii) Liens encumbering property or assets
under construction arising from progress or partial payments by a customer of
the Company or its Subsidiaries and that relate to such property or assets; (ix)
any interest or title of a lessor in the property subject to any Capitalized
Lease or operating lease; (x) Liens arising from filing Uniform Commercial Code
financing statements regarding leases; (xi) Liens (including extensions or
renewals thereof) on property of, or on shares of Capital Stock or Indebtedness
of, any Person existing at the time such Person becomes, or becomes a part of,
the Company or any Subsidiary; provided that such Liens do not extend to or
cover any property or assets of the Company or any Subsidiary other than the
property or assets acquired; (xii) Liens in favor of the Company or any
Subsidiary; (xiii) Liens arising from the rendering of a final judgment or order
against the Company or any Subsidiary of the Company that does not give rise to
an Event of Default; (xiv) Liens securing reimbursement obligations with respect
to letters of credit that encumber documents and other property and that relate
to such letters of credit and the products and proceeds thereof; (xv) Liens in
favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods; (xvi)
Liens encumbering customary initial deposits and margin deposits, and other
Liens that are within the general parameters customary in the industry and
incurred in the ordinary course of business, in each case securing Indebtedness
under Interest Rate Agreements and Currency Agreements and forward contracts,
options, future contracts, futures options or similar agreements or arrangements
designed solely to protect the Company or any of its Subsidiaries from
fluctuations in interest rates, currencies or the price of commodities; (xvii)
Liens arising out of conditional sale, title retention, consignment or similar
arrangements for the sale of goods entered into by the Company or any of its
Subsidiaries in the ordinary course of business in accordance with the past
practices of the Company and its
15
Subsidiaries prior to the Closing Date; (xviii) Liens (and any extensions or
renewals thereof) on or sales of receivables; (xix) Liens (and any extensions or
renewals thereof; provided that any such extensions or renewals do not increase
the amount of the obligations secured thereby) existing on the Closing Date;
(xx) Liens (and any extensions or renewals thereof) granted after the Closing
Date on any assets or Capital Stock of the Company or its Subsidiaries that are
created in favor of the Holders or a representative of the Holders; (xxi) Liens
with respect to the assets of a Subsidiary granted by such Subsidiary to the
Company or a Wholly Owned Subsidiary to secure Indebtedness owing to the Company
or such other Subsidiary; (xxii) Liens securing Indebtedness which is incurred
to refinance secured Indebtedness; provided that such Liens do not extend to or
cover any property or assets of the Company or any Subsidiary, other than the
property or assets securing the Indebtedness being refinanced and (xxiii) any
and all Liens granted pursuant to and in connection with the Security Documents;
provided, however, that notwithstanding any of the foregoing or otherwise,
Permitted Liens shall not include any Liens on the First QuickBird Satellite or
the First QuickBird Launch Insurance except, in the case of Liens on the First
QuickBird Launch Insurance, Liens thereon in favor of the Collateral Trustee or
otherwise securing the Notes and the 12 1/2% Notes.
"Person" means any individual, partnership, corporation (including a
------
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or
political subdivision or agency thereof or any other entity.
"Preferred Stock" means the Series A Preferred Stock, the Series B
---------------
Preferred Stock, and the Series C Preferred Stock.
"Private Placement Legend" means the legend initially set forth on
------------------------
the Notes in the form set forth in Section 2.7(g)(i).
"Public Equity Offering" means an underwritten primary public
----------------------
offering of Common Stock of the Company pursuant to an effective Registration
Statement under the Securities Act.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
---
"Redeemable Stock" means any class or series of Capital Stock of any
----------------
Person that by its terms or otherwise is (i) required to be redeemed on or prior
to the Stated Maturity of the Notes, (ii) redeemable at the option of the holder
of such class or series of Capital Stock at any time prior to the Stated
Maturity of the Notes or (iii) convertible into or exchangeable for Capital
Stock referred to in clause (i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Notes; provided that any Capital
Stock that would not constitute Redeemable Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of a "change of control" occurring prior
to the Stated Maturity of the Notes shall not constitute Redeemable Stock if (a)
16
the "change of control" provisions applicable to such Capital Stock are no more
favorable to the holders of such Capital Stock than the provisions contained in
Section 4.6 hereof; and (b) such Capital Stock, or the agreements or
instruments governing the redemption rights of such Capital Stock, specifically
provides that such Person shall not repurchase or redeem any such stock pursuant
to such provision prior to the Company's repurchase of such Notes as are
required to be repurchased pursuant to Section 4.6 hereof.
"Redemption Date", when used with respect to any Note to be redeemed,
---------------
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Note to be redeemed,
----------------
means the price at which such Note is to be redeemed pursuant to this Indenture.
"Register" has the meaning provided in Section 2.3.
--------
"Registrar" has the meaning provided in Section 2.3.
---------
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement, dated July 12, 1999, between the Company and Xxxxxx Xxxxxxx & Co.
Incorporated and certain permitted assigns specified therein.
"Registration Statement" means the Registration Statement as defined
----------------------
and described in the Registration Rights Agreement.
"Regular Record Date" for the interest payable on any Interest Payment
-------------------
Date means the January 1 or July 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.
"Related Person" means any holder (or any Affiliate of such holder) of
--------------
5% or more of any class of Capital Stock of the Company and any Affiliate of the
Company or any Subsidiary.
"Responsible Officer", when used with respect to the Trustee, means
-------------------
any vice president, any assistant vice president, any assistant secretary, any
assistant treasurer, any trust officer or assistant trust officer or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his or her knowledge of and familiarity with the particular
subject.
"Restricted Book-Entry Interest" means the 144A Book-Entry Interests.
------------------------------
"Restricted Definitive Registered Note" means a Definitive Registered
-------------------------------------
Note bearing the Private Placement Legend.
17
"Restricted Global Note" means the 144A Global Note which shall bear
----------------------
the Private Placement Legend.
"Restricted Payments" has the meaning provided in Section 4.3.
-------------------
"Rule 144A" means Rule 144A under the Securities Act.
---------
"S&P" means Standard & Poor's Ratings Services and its successors.
---
"Securities Act" means the United States Securities Act of 1933, as
--------------
amended.
"Security Documents" means the (1) the Pledge Agreement, dated as of
------------------
July 7, 1999, among the Company, Collateral Trustee and The Bank of New York, as
securities intermediary, under which the Company will pledge to the Collateral
Trustee certain United States Treasury Securities purchased with a portion of
the net proceeds of the issuance of the Permitted Specified Indebtedness to
secure payment from time to time of premiums in respect of the First QuickBird
Launch Insurance and (2) the Amended and Restated Collateral Pledge and Security
Agreement dated as of July 7, 1999, as amended, made by the Company in favor of
the Collateral Trustee pursuant to which Company shall grant to the Collateral
Trustee a Lien in the Collateral and pursuant to which any proceeds of the
Collateral shall be allocated in order to (A) provide on a pari passu basis for
(i) the original principal amount of the Notes on the Issue Date and the
original issue discount and interest accrued for the period from the Issue Date
through the earlier of June 30, 2000 and the date that the First QuickBird
Satellite is launched, all as more specifically provided therein and (ii) the
original principal amount of the 12 1/2% Notes and original issue discount or
interest accrued for the period from the issue date(s) thereof through the
earlier of June 30, 2000 and the date that the First QuickBird Satellite is
launched, all as more specifically provided therein and (B) provide for the
residual payment to the Company after the required priority payments in respect
of the Notes and the 12 1/2% Notes, all as more specifically provided therein,
as such Agreement may be amended, restated, supplemented or otherwise modified
from time to time.
"Separation Date" has the meaning specified in the recitals to this
---------------
Indenture.
"Series A Preferred Stock" means the Series A Preferred Stock, par
------------------------
value $.001 per share, of the Company to be issued in the Recapitalization
Transaction.
"Series B Preferred Stock" means the Series B Preferred Stock, par
------------------------
value $.001 per share, of the Company to be issued in the Recapitalization
Transaction.
"Series C Preferred Stock" means the Series C Preferred Stock, par
------------------------
value $.001 per share, of the Company to be issued in the Recapitalization
Transaction.
18
"Shelf Registration Statement" means the Shelf Registration Statement
----------------------------
as defined in the Registration Rights Agreement.
"Significant Subsidiary" means, at any date of determination, any
----------------------
Subsidiary that, together with its Subsidiaries, (i) for the most recent fiscal
year of the Company, accounted for more than 10% of the consolidated revenues of
the Company and its Subsidiaries or (ii) as of the end of such fiscal year, was
the owner of more than 10% of the consolidated assets of the Company and its
Subsidiaries, all as set forth on the most recently available consolidated
financial statements of the Company for such fiscal year.
"Specified Date" means (i) any Payment Date with respect to an Offer
--------------
to Purchase pursuant to Section 4.6, (ii) any Payment Date with respect to an
Offer to Purchase pursuant to Section 4.12, (iii) any Redemption Date with
respect to an optional redemption pursuant to Section 3.1 or (iv) any date on
which the Notes are due and payable after an Event of Default.
"Stated Maturity" means, (i) with respect to any debt security, the
---------------
date specified in such debt security as the fixed date on which the final
installment of principal of such debt security is due and payable and (ii) with
respect to any scheduled installment of principal of or interest on any debt
security, the date specified in such debt security as the fixed date on which
such installment is due and payable.
"Stockholders' Agreement" means that certain Stockholders' Agreement
-----------------------
dated as of April 8, 1999 by and among the Company, Xxxxxx Xxxxxxx & Co.
Incorporated, American High-Income Trust, American Variable Insurance Series
Asset Allocation Fund, American Variable Insurance Series Bond Fund, American
Variable Insurance Series High-Yield Bond Fund, The Bond Fund of America, Inc.,
ITT Industries, Inc., Ball Technology Holdings Corp. and the other Persons
listed on the signature pages thereto.
"Strategic Subordinated Indebtedness" means Indebtedness of the
-----------------------------------
Company Incurred to finance the acquisition of a Person engaged in a business
that is related, ancillary or complementary to the business conducted by the
Company or any of its Subsidiaries, which Indebtedness by its terms, or by the
terms of any agreement or instrument pursuant to which such Indebtedness is
Incurred: (1) is expressly made subordinate in right of payment to the Notes;
and (2) provides that no payment of principal, premium or interest on, or any
other payment with respect to, such Indebtedness may be made prior to the
payment in full of all of the Company's obligations under the Notes; provided
that such Indebtedness may provide for and be repaid at any time from the
proceeds of a capital contribution or the sale of Capital Stock (other than
Redeemable Stock) of the Company after the Incurrence of such Indebtedness.
"Subsidiary" means, with respect to any Person, any corporation,
----------
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.
19
"Tax" means any tax, duty, levy, impost, assessment or other
---
governmental charge (including penalties, interest and any other liabilities
related thereto).
"Taxing Authority" means any government or political subdivision or
----------------
territory or possession of any government or any authority or agency therein or
thereof having power to tax.
"Temporary Cash Investment" means any of the following: (i) direct
-------------------------
obligations of the United States of America or any agency thereof, or
obligations fully and unconditionally guaranteed by the United States of America
or any agency thereof, (ii) time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof and issued by a bank or trust company which is organized under the laws
of the United States of America, any state thereof or any foreign country
recognized by the United States, which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $50,000,000 (or the
foreign currency equivalent thereof) and has outstanding debt which is rated "A"
(or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor, (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types described in clause (i)
above, which obligations are entered into with a bank meeting the qualifications
described in clause (ii) above, (iv) commercial paper, maturing not more than 90
days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America, any state thereof or any foreign country recognized by
the United States of America with a rating, at the time as of which any
investment therein is made, of "P-l" (or higher) according to Xxxxx'x or "A-l"
(or higher) according to S&P, and (v) securities with maturities of six months
or less from the date of acquisition that are issued or fully and
unconditionally guaranteed by any state, commonwealth or territory of the United
States of America, or by any political subdivision or taxing authority thereof,
and rated at least "A" by S&P or Xxxxx'x.
"TIA" or "Trust Indenture Act" means the United States Trust Indenture
--- -------------------
Act of 1939, as amended (15 U.S. Code (S)(S) 77aaa-77bbb), as in effect on the
date this Indenture was executed, except as provided in Section 9.6.
"Trade Payable " means, with respect to any Person, any accounts
-------------
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services.
"Transaction Date" means the date on which any Restricted Payment is
----------------
to be made.
20
"Trustee" means the party named as such in the first paragraph of this
-------
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.
"12 1/2% Notes" means the 12 1/2% Senior Notes due 2005 of the
-------------
Company issued under an indenture dated as of March 19, 1997, as amended and
restated as of April 8, 1999, between the Company and The Bank of New York,
trustee.
"Voting Stock" means, with respect to any Person, Capital Stock of
------------
any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
"Wholly Owned" means, with respect to any Subsidiary of any Person,
------------
the ownership of all of the outstanding Capital Stock of such Subsidiary (other
than any director's qualifying shares or Investments by foreign nationals
mandated by applicable law) by such Person or one or more Wholly Owned
Subsidiaries of such Person.
Section 1.2. Incorporation by Reference of Trust Indenture Act.
-------------------------------------------------
Whenever this Indenture refers to a provision of the TIA, such 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;
-------------------------
"indenture to be qualified" means this Indenture;
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee; and
----------------- ---------------------
"obligor" on the indenture securities means the Company or any other
-------
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.
Section 1.3. Rules of Construction. Unless the context otherwise
---------------------
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
21
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the
plural include the singular;
(v) provisions apply to successive events and transactions;
(vi) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision;
(vii) all references to Sections, Articles or Exhibits refer to
Sections, Articles or Exhibits of this Indenture unless otherwise
indicated; and
(viii) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement or successor sections of
the Securities Act or rules adopted by the Commission from time to time.
ARTICLE TWO
THE NOTES
Section 2.1. Form and Dating. (a) Global Notes. Notes distributed to
---------------
QIBs in reliance on Rule 144A shall be issued initially in the form of a 144A
Global Note, which shall be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, as custodian for the Depositary, at its
New York corporate trust office, duly executed by the Company and authenticated
by the Trustee as hereinafter provided. The aggregate principal amount of the
Global Note may from time to time be increased or decreased by adjustments made
on the records of the Trustee as hereinafter provided.
A Global Note shall represent such of the outstanding Notes as shall
be specified therein and shall provide that it shall represent the aggregate
principal amount at maturity of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount at maturity of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and transfers of interests
therein in accordance with the terms of this Indenture. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in the principal
amount at maturity of outstanding Notes represented thereby shall be made by the
Trustee in accordance with written instructions given by the Holder thereof as
required by Section 2.7 hereof.
Except as set forth in Section 2.7(a) hereof, the Global Notes may be
transferred, in whole and not in part, only to a successor of the Depositary.
22
(b) Book-Entry Provisions. The Global Notes shall (i) be registered in
the name of Cede & Co., as nominee of the Depositary, (ii) be delivered to the
Trustee as custodian for the Depositary and (iii) bear legends as set forth in
Section 2.7(g).
The Trustee shall issue to the Depositary a Depositary Interest in
such Global Note by recording the Depositary Interest in the register of the
Trustee in the name of Cede & Co., as nominee of the Depositary. Ownership of
Book-Entry Interests shall be limited to Participants and Indirect Participants.
Upon the issuance of the Depositary Interest in such Global Note to the
Depositary, the Depositary shall credit, on its internal book-entry registration
and transfer system, its Participant's accounts with the respective interests
owned by such Participants.
Neither the Participants nor the Indirect Participants shall have any
rights either under this Indenture or under any Global Note with respect to such
Global Note held on their behalf by the Trustee, and the Depositary may be
treated by the Company, the Trustee and any agent of the Company or the Trustee
as the absolute owner of such Global Note for the purpose of receiving payment
of or on account of the principal of and, subject to the provisions of this
Indenture and interest on the Global Notes and for all other purposes.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and its Participants, the operation of
customary practices of such Depositary governing the exercise of the rights of
an owner of a beneficial interest in any Global Note.
(c) Note Forms. The provisions of the forms of Notes contained in
Exhibits A and B hereto are incorporated herein by reference.
(d) Dating. Each Note shall be dated the date of its authentication.
Section 2.2. Execution and Authentication. Any director or officer of
----------------------------
the Company shall execute the Notes on behalf of the Company by manual or
facsimile signature. The Company's corporate seal may be reproduced on the Notes
and may be in facsimile form.
If the director or officer whose manual or facsimile signature is on a
Note no longer holds that position or office at the time the Trustee
authenticates the Note or at any time thereafter, the Note nevertheless shall be
valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. Such signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate Notes in an aggregate principal amount
at maturity of $__,000,000 upon receipt of a Company Order directing the Trustee
to authenticate the Notes.
23
The Global Notes, the Restricted Definitive Registered Notes and the Definitive
Registered Notes shall be issuable only in registered form. The Notes shall be
issued without coupons and only in denominations of U.S. $1,000 principal
amount at maturity or any integral multiple thereof.
The Trustee may appoint an authenticating agent reasonably 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. Such authenticating agent shall have the
same rights as the Trustee in any dealings hereunder with the Company or with
any of the Company's Affiliates.
Section 2.3. Registrar and Paying Agent. The Company shall maintain an
--------------------------
office or agency (which shall be located in the Borough of Manhattan in The City
of New York, State of New York) where Definitive Registered Notes may be
presented for registration of transfer or for exchange (the "Registrar"), an
---------
office or agency (which shall be located in the Borough of Manhattan, The City
of New York, State of New York) where Notes may be presented for payment (the
"Paying Agent"), and an office or agency where notices and demands to or upon
------------
the Company in respect of the Notes and this Indenture may be served. The
Registrar shall keep a register containing the names and addresses of all
Holders (the "Register") and of the transfer and exchange of Definitive
--------
Registered Notes. Any notice to be given under this Indenture or under the Notes
by the Trustee or the Company to Holders shall be mailed by first class mail to
each Holder at his address as it appears at the time of such mailing in the
Register. The Company may have one or more co-Registrars and one or more
additional paying agents. The term "Paying Agent" includes any additional paying
agent. Except as otherwise provided herein, the Company or any Subsidiary
thereof may act as Paying Agent. 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. 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 shall enter into an appropriate agency agreement with any
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 in writing of the
name and address of any such Agent. If the Company fails to maintain a Registrar
or Paying Agent, or fails to give the foregoing notice, the Trustee shall act as
such and shall be entitled to appropriate compensation in accordance with
Section 7.7.
The Company initially appoints the Corporate Trust Office of the
Trustee in the Borough of Manhattan located at the address set forth in Section
12.2 as Registrar, Paying Agent and agent for service of notices and demands in
connection with the Notes and this Indenture.
24
Section 2.4. Holders to Be Treated as Owners; Payments of Interest.
-----------------------------------------------------
(a) The Company, the Paying Agent, the Registrar, the Trustee and any agent of
the Company, the Paying Agent, the Registrar or the Trustee may deem and treat
each Holder of a Note as the absolute owner of such Note for the purpose of
receiving payment of or on account of the principal of and, subject to the
provisions of this Indenture and the Notes, interest on such Note and for all
other purposes. None of the Company, the Paying Agent, the Registrar, the
Trustee or any agent of the Company, the Paying Agent, the Registrar or the
Trustee shall be affected by any notice to the contrary. All such payments so
made to any such Person, or upon his order. shall be valid, and, to the extent
of the sum or sums so paid, effectual to satisfy and discharge the liability
for moneys payable upon any Note.
(b) As set forth more fully in the Notes, (i) interest accruing on
the Notes for the period from the Closing Date through July 15, 2002 shall
accrue and be added on each relevant Interest Payment Date to the principal
amount thereof and (ii) interest accruing on the Notes for the period commencing
on July 15, 2002 and continuing thereafter shall be payable in cash on each
Interest Payment Date commencing with the Interest Payment Date of January 15,
2003. The Holder of a Definitive Registered Note at the close of business on the
Regular Record Date with respect to any Interest Payment Date shall be entitled
to receive the interest payable on such Interest Payment Date notwithstanding
any transfer or exchange of such Definitive Registered Note subsequent to the
Regular Record Date and prior to such Interest Payment Date, except if and to
the extent the Company shall default in the payment of the interest due on such
Interest Payment Date, in which case such defaulted interest shall be paid in
accordance with Section 2.13; provided that, in the event of an exchange of a
Definitive Registered Note for a beneficial interest in any Global Note
subsequent to a Regular Record Date or any special record date and prior to or
on the related Interest Payment Date or other payment date under Section 2.13,
any payment of interest payable on such payment date with respect to any such
Definitive Registered Note shall be made to the Person in whose name such
Definitive Registered Note was registered on such record date. Payments of
interest on the Global Notes shall be made to the Holder of the Global Note on
each Interest Payment Date; provided that, in the event of an exchange of all or
a portion of the Global Note for Definitive Registered Notes subsequent to the
Regular Record Date or any special record date and prior to or on the related
Interest Payment Date or other payment date under Section 2.13, any payment of
interest payable on such payment date with respect to the Definitive Registered
Note shall be made to the Holder of the Global Note.
(c) The Trustee shall pay interest to the extent funds therefor are
available to the Depositary with respect to any Global Note held by the Trustee,
in accordance with written instructions received from the Depositary, at least
five Business Days before the applicable Interest Payment Date.
Section 2.5. Paying Agent to Hold Money in Trust. The Company shall
-----------------------------------
require each Paying Agent other than the Trustee to agree in writing that such
Paying Agent shall hold in trust for the benefit of the Holders or the Trustee
all money held by the Paying Agent for the
25
payment of principal of, or interest on, the Notes (whether such money has been
paid to it by the Company or any other obligor on the Notes), and the Company
and the Paying Agent shall notify the Trustee in writing of any default by the
Company (or any other obligor on the Notes) in making any such payment. Unless
the Company or any Subsidiary is the Paying Agent, money held in trust by the
Paying Agent need not be segregated except as required by law, and in no event
shall the Paying Agent be liable for any interest on any money received by it
hereunder. The Company at any time may require the Paying Agent to pay all money
held by it to the Trustee and account for any funds disbursed, and the Trustee
may at any time during the continuance of any Event of Default specified in
Section 6.1(a) or (b), upon written request to the Paying Agent, require such
Paying Agent to pay forthwith all money so held by it to the Trustee and to
account for any funds disbursed. Upon making such payment, the Paying Agent
shall have no further liability for the money delivered to the Trustee. If the
Company or any Subsidiary of the Company acts as Paying Agent, it shall, on or
before each due date of the principal of or interest on the Notes, segregate and
hold in trust for the benefit of the Persons entitled thereto a sum sufficient
to pay the principal or interest so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and shall promptly
notify the Trustee of its action or failure so to act.
Section 2.6. Holder Lists. The Trustee shall preserve in as current a
------------
form as is reasonably practicable the most recent list available to it from the
Registrar of the names and addresses of the Holders of Notes. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least five
Business Days before each Interest Payment Date, and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes, if any.
Section 2.7. Transfer and Exchange. Unless and until a Note is
---------------------
exchanged for an Exchange Note or sold in connection with an effective
Registration Statement pursuant to the Registration Rights Agreement, the
following provisions shall apply: (a) Transfer and Exchange of Global Notes.
Transfer of the Global Notes shall be by delivery. All Global Notes shall be
exchanged by the Company for Definitive Registered Notes if (i) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 90 days after the date of such
notice from the Depositary or (ii) the Company in its sole discretion determines
that the Global Notes (in whole but not in part) should be exchanged for
Definitive Registered Notes and delivers a written notice to such effect to the
Trustee. Upon the occurrence of any of the preceding events, Definitive
Registered Notes shall be issued in such names as the Depositary shall instruct
the Trustee. Global Notes may also be exchanged or replaced, in whole or in
part, as provided in Sections 2.8 and 2.11. Every Note authenticated and
delivered in exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to Section 2.8 or 2.11 hereof, shall be authenticated and delivered in
the form of, and shall be, a Global Note. A Global Note may not be exchanged for
another Note other than as provided in this Section 2.7(a).
26
(b) Transfer and Exchange of Book-Entry Interests. The transfer and
exchange of Book-Entry Interests shall be effected through the Depositary, in
accordance with this Indenture and the procedures of the Depositary therefor.
Book-Entry interests in Restricted Global Notes shall be subject to restrictions
on transfer comparable to those set forth herein to the extent required by the
Securities Act. The Trustee shall have no obligation to ascertain the
Depositary's compliance with any such restrictions on transfer. Transfers of
Book-Entry Interests shall also require compliance with subparagraph (i) below,
as well as one or more of the other following subparagraphs as applicable:
(i) All Transfers and Exchanges of Book-Entry Interests. In
connection with all transfers and exchanges of Book-Entry Interests (other
than transfers of Book-Entry Interests in a Global Note to Persons who take
delivery thereof in the form of a Book-Entry Interest in the same Global
Note), the transferor of such Book-Entry Interest must deliver to the
Registrar either (A) (1) instructions given in accordance with the
Applicable Procedures from a Participant or an Indirect Participant
directing the Depositary to credit or cause to be credited a Book-Entry
Interest in the specified Global Note in an amount equal to the Book-Entry
Interest to be transferred or exchanged, (2) a written order given in
accordance with the Applicable Procedures containing information regarding
the Participant account to be credited with such increase and (3)
instructions given by the Holder of the Global Note to effect the transfer
referred to in (1) and (2) above or (B) (1) instructions given in
accordance with the Applicable Procedures from a Participant or an Indirect
Participant directing the Depositary to cause to be issued a Definitive
Registered Note in an amount equal to the Book-Entry Interest to be
transferred or exchanged and (2) instructions given by the Holder of the
Global Note to effect the transfer referred to in (1) above.
(ii) Transfer of Book-Entry Interests in the Same Restricted Global
Note. Book-Entry Interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a Book-Entry Interest
in the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend.
(c) Transfer or Exchange of Book-Entry Interests for Definitive
Registered Notes.
(i) If any holder of a Book-Entry Interest in a Restricted Global
Note proposes to exchange such Book-Entry Interests for a Definitive
Registered Note or to transfer such Book-Entry interest to a Person who
takes delivery thereof in the form of a Definitive Registered Note, then,
upon receipt by the Registrar of the following documentation (all of which
may be submitted by facsimile):
(A) if the holder of such Book-Entry Interest in a Restricted
Global Note proposes to exchange such Book-Entry Interest for a
Restricted Definitive
27
Registered Note. a certificate from such holder in the form of Exhibit
D hereto, including the certifications in item (2)(a) thereof;
(B) if such Book-Entry Interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate to
the effect set forth in Exhibit C hereto, including the certifications
in item (1) thereof;
(C) if such Book-Entry Interest is being transferred pursuant to
an exemption from registration in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit C
hereto, including the certifications in item (2)(a) thereof;
(D) if such Book-Entry Interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) and (C) above, a certificate to the effect
set forth in Exhibit C hereto, including the certifications in item
(3)(d) thereof, a certificate from the transferee to the effect set
forth in Exhibit E hereof and, to the extent required by item (3)(d)
of Exhibit C, an Opinion of Counsel from the transferee or the
transferor reasonably acceptable to the Company to the effect that
such transfer is in compliance with the Securities Act and such Book-
Entry Interest is being transferred in compliance with any applicable
blue sky securities laws of any state of the United States.
(E) if such Book-Entry Interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit C hereto, including the certifications in item (2)(b)
thereof; or
(F) if such Book-Entry interest is being transferred pursuant to
an effective Registration Statement under the Securities Act, a
certificate to the effect set forth in Exhibit C hereto, including the
certifications in item (2)(c) thereof;
the Trustee shall cause the aggregate principal amount of the Global Note
to be reduced accordingly and direct the Depositary to make a corresponding
reduction in its book-entry system of the corresponding Depositary
Interests, and the Company shall execute and the Trustee shall authenticate
and deliver to the Person designated in the instructions a Definitive
Registered Note in the appropriate principal amount; provided, however,
that no Definitive Registered Notes shall be delivered until all applicable
requirements set forth in this Section 2.7(c) shall have been satisfied.
Definitive Registered Notes issued in exchange for a Book-Entry Interest
pursuant to this Section 2.7(c) shall be registered in such names and in
such authorized denominations as the Holder shall instruct the Registrar
through instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Registered Notes to
the Persons in whose names such Notes are so registered. Definitive
Registered Notes issued in
28
exchange for a Book-Entry interest pursuant to this Section 2.7(c)(i) shall
bear the Private Placement Legend and shall be subject to all restrictions
on transfer contained therein unless the Registrar receives the following:
(A) if the holder of such Book-Entry Interest in a Restricted
Global Note proposes to exchange such Book-Entry Interest for a
Definitive Registered Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit D
hereto, including the certifications in item (1)(b) thereof; and
(B) if the holder of such Book-Entry Interest in a Restricted
Global Note proposes to transfer such Book-Entry Interest to a Person
who shall take delivery thereof in the form of a Definitive Registered
Note that does not bear the Private Placement Legend, a certificate in
the form of Exhibit C hereto, including the certifications in item (3)
thereof; and
(C) in each such case set forth in subparagraphs (A) and (B)
above an Opinion of Counsel in form reasonably acceptable to the
Company, to the effect that such exchange or transfer is in compliance
with the Securities Act, that the restrictions on transfer contained
herein and in the Private Placement Legend are not required in order
to maintain compliance with the Securities Act, and such Book-Entry
Interest is being exchanged or transferred in compliance with any
applicable blue sky securities laws of any State of the United States.
(ii) Definitive Registered Notes issued in exchange for a Book-Entry
Interest pursuant to this Section 2.7(c)(ii) shall be registered in such
names and in such authorized denominations as the Holder shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Registered
Notes to the Persons in whose names such Notes are so registered.
Definitive Registered Notes issued in exchange for a Book-Entry Interest
pursuant to this Section 2.7(c)(ii) shall not bear the Private Placement
Legend.
(d) Transfer or Exchange of Restricted Definitive Registered Notes for
Book-Entry Interests. If any holder of Restricted Definitive Registered Notes
proposes to exchange such Notes for a Book-Entry Interest in a Restricted Global
Note or to transfer such Restricted Definitive Registered Notes to a Person who
takes delivery thereof in the form of a Book-Entry Interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following documentation
(all of which may be submitted by facsimile):
(i) if such Restricted Definitive Registered Notes are being
transferred to a QIB in accordance with Rule 144A under the Securities Act,
a certificate to the effect set forth in Exhibit C hereto, including the
certifications in item (1) thereof;
29
(ii) if such Definitive Registered Notes are being transferred to the
Company or one of its Subsidiaries, a certificate to the effect set forth
in Exhibit C hereto, including the certifications in item (2)(b) thereof;
or
(iii) if such Definitive Registered Notes are being transferred
pursuant to an effective Registration Statement under the Securities Act, a
certificate to the effect set forth in Exhibit C hereto including the
certifications in item (2)(c) thereof;
the Trustee shall cancel the Definitive Registered Notes, increase or cause to
be increased the aggregate principal amount of, in the case of clause (i) above,
the 144A Global Note and direct the Depositary to make a corresponding increase
in its book-entry system of the corresponding Depositary Interest.
(e) Transfer and Exchange of Definitive Registered Notes. When
Definitive Registered Notes are presented by a Holder to the Registrar with a
request to register the transfer of the Definitive Registered Notes or to
exchange such Definitive Registered Notes for an equal principal amount of
Definitive Registered Notes of other authorized denominations, the Registrar
shall register the transfer or make the exchange as requested only if the
Definitive Registered Notes are presented or surrendered for registration of
transfer or exchange and are endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by his attorney, duly authorized in writing and upon receipt of such
certificates and Opinions of Counsel as shall be necessary to evidence
compliance with the restrictions on transfer contained in the Private Placement
Legend and this Indenture.
(f) Intentionally Omitted.
(g) Legends. Unless and until a Note is exchanged for an Exchange
Note or sold in connection with an effective Registration Statement pursuant to
the Registration Rights Agreement, (i) each Restricted Global Note and, except
as permitted by clause (ii) below, each Definitive Registered Note (and all
Notes issued in exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, 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, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) or (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL
ACCREDITED
30
INVESTOR"); (2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO
UNDER RULE 144(k) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF SUCH
TRANSFER, RESELL, OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO EARTHWATCH
OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO
THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE ACCRETED VALUE OF NOTES OF LESS THAN $250,000, AN OPINION OF
COUNSEL ACCEPTABLE TO EARTHWATCH THAT SUCH TRANSFER IS IN COMPLIANCE WITH
THE SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN
CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THE TIME PERIOD REFERRED
TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
THE TRUSTEE AND EARTHWATCH SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS EITHER MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER
IS BEING MADE PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE INDENTURE
CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY
TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS.
Each Note issued prior to the Separation Date shall bear the following
legend (the "Unit Legend") on the face thereof;
THIS NOTE IS INITIALLY ISSUED AS PART OF AN ISSUANCE OF UNITS, EACH OF
WHICH CONSISTS OF ONE 13% SENIOR DISCOUNT NOTE DUE 2007 OF EARTHWATCH
INCORPORATED AND 49.095 SHARES OF 8.5% SERIES C CUMULATIVE CONVERTIBLE
REDEEMABLE PREFERRED STOCK OF EARTHWATCH INCORPORATED. PRIOR TO THE CLOSE
OF
31
BUSINESS UPON THE EARLIEST TO OCCUR OF (i) THE DATE THAT IS SIX MONTHS
AFTER THE CLOSING DATE; (ii) THE COMMENCEMENT OF THE EXCHANGE OFFER FOR THE
NOTES, (iii) THE EFFECTIVENESS OF A SHELF REGISTRATION STATEMENT WITH
RESPECT TO THE NOTES; OR (iv) A DATE DETERMINED BY XXXXXX XXXXXXX & CO.
INCORPORATED IN ITS SOLE DISCRETION. THE NOTES EVIDENCED BY THIS
CERTIFICATE MAY NOT BE TRANSFERRED OR EXCHANGED SEPARATELY FROM, BUT MAY BE
TRANSFERRED OR EXCHANGED ONLY TOGETHER WITH, THE SHARES OF PREFERRED STOCK
ISSUED BY EARTHWATCH INCORPORATED IN CONNECTION HEREWITH.
(ii) In connection with the transfer or exchange of any Restricted
Definitive Registered Notes, if the Registrar receives the following:
(A) if the Holder of such Restricted Definitive Registered Notes
proposes to exchange such Notes for a Definitive Registered Note that does
not bear the Private Placement Legend, a certificate from such holder in
the form of Exhibit D hereto, including the certifications in item (1)(d)
thereof;
(B) if the Holder of such Restricted Definitive Registered Notes
proposes to transfer such Notes to a Person who shall take delivery thereof
in the form of a Definitive Registered Note that does not bear the Private
Placement Legend, a certificate in the form of Exhibit C hereto, including
the certifications in item (4) thereof; and
(C) in each case set forth in these subparagraphs (A) and (B), an
Opinion of counsel in form reasonably acceptable to the Company, to the
effect that such exchange or transfer is in compliance with the Securities
Act, that the restrictions on transfer contained herein and in the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act, and such exchange or transfer is being exchanged or
transferred in compliance with any applicable blue sky securities laws of
any State of the United States,
then, upon compliance with the provisions of Section 2.7(e), the Trustee shall
authenticate and issue Definitive Registered Notes that do not bear the Private
Placement Legend and all restrictions on the transfer of such Definitive
Registered Notes shall be rescinded.
(h) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
THIS GLOBAL NOTE IS HELD BY THE TRUSTEE, AS CUSTODIAN FOR THE DEPOSITARY
(AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE), IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY
32
CIRCUMSTANCES EXCEPT THAT (I) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE
BUT NOT IN PART PURSUANT TO SECTION 2.7(a) OF THE INDENTURE AND (II) THIS
GLOBAL NOTE MAY BE TRANSFERRED TO A DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF EARTHWATCH INCORPORATED.
(i) Intentional1y Omitted.
(j) Intentionally Omitted.
(k) Cancellation and/or Adjustment of Global Notes. At such time as
all Book-Entry Interests have been exchanged for Definitive Registered Notes,
all Global Notes shall be returned to or retained and canceled by the Trustee in
accordance with Section 2.12 hereof. At any time prior to such cancellation, if
any Book-Entry Interest is exchanged for an interest in another Global Note or
for Definitive Registered Notes, the principal amount of Notes represented by
such Global Note shall be reduced accordingly and an endorsement shall be made
on such Global Note, by the Trustee or the Depositary, at the direction of the
Trustee, to reflect such reduction.
(1) General Provisions Relating to All Transfers and Exchanges. (i)
To permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Global Notes and Definitive Registered Notes
upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any stamp or transfer tax or similar governmental charge
payable in connection therewith (other than any such stamp or transfer taxes or
similar governmental charge payable upon exchange or transfer pursuant to
Sections 2.11, 3.1, 4.6, 4.12 and 9.4 hereof).
(iii) All Global Notes and Definitive Registered Notes issued upon
any registration of transfer or exchange of Global Notes or Definitive
Registered Notes shall be the valid obligations of the Company, evidencing the
same debt and entitled to the same benefits under this Indenture, as the Global
Notes or Definitive Registered Notes surrendered upon such registration of
transfer or exchange.
(iv) The Company shall not be required (A) to issue, to register the
transfer of or to exchange Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for redemption under
Section 3.3 hereof and ending at the close of business on the day of selection,
(B) to register the transfer of or to exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of any Note being
redeemed in part or (C) to register the transfer of, or to exchange a Note
between, a record date and the next succeeding Interest Payment Date.
33
(v) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the Person
in whose name any Note is registered as the absolute owner of such Note for the
purpose of receiving payment of principal of and interest on such Notes and for
all other purposes, and neither the Trustee, any Agent nor the Company shall be
affected by notice to the contrary.
(vi) The Trustee shall authenticate Global Notes and Definitive
Registered Notes in accordance with the provisions of Section 2.2 hereof.
(m) Transfers Not Covered by Sections 2.7(a)(b)(c)(d) or (e). The
Registrar shall effect and record, upon receipt of a written request so to do, a
transfer not otherwise permitted by Sections 2.7(a)(b)(c)(d) or (e), such
recording to be done in accordance with the otherwise applicable provisions of
Section 2.7, upon the furnishing by the proposed transferor or transferee of a
written opinion of counsel reasonably satisfactory to the Company to the effect
that, and such other certification or information as the Company and the
Registrar may reasonably require to confirm that, the proposed transfer is being
made pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.
Section 2.8. Replacement Notes. If a mutilated Definitive Registered
-----------------
Note is surrendered to the Registrar or the Trustee, if a mutilated Global Note
is surrendered to the Company or the Trustee or if the Company and the Trustee
receive evidence to their satisfaction that any Note has been lost, destroyed or
stolen, the Company shall issue and the Trustee shall authenticate a replacement
Note in such form as the Notes mutilated, lost, destroyed or wrongfully taken if
(i) in the case of a lost, destroyed or stolen Note, the Holder of such Note
furnishes to the Company, the Trustee and, in the case of a Definitive
Registered Note, the Registrar, evidence reasonably acceptable to them of the
ownership and the destruction, loss or theft of such Note and (ii) an indemnity
bond shall be posted by the Holder requesting replacement, sufficient in the
judgment of each to protect the Company, the Registrar (in the case of a
Definitive Registered Note), the Trustee or any Agent from any loss that any of
them may suffer if such Note is replaced. Prior to the issuance of any such
replacement Note, the Trustee shall notify the Company of any request therefor.
The Company may charge such Holder for the Company's out-of-pocket expenses in
replacing such Note and the Trustee may charge the Holder for the Trustee's
expenses in replacing such Note. Every replacement Note shall constitute an
additional obligation of the Company and shall be entitled to all of the
benefits of this Indenture equally and proportionally with all other Notes
issued hereunder. The provisions of this Section 2.8 are exclusive and shall
preclude (to the extent permitted by applicable law) all other rights and
remedies with respect to the replacement of mutilated, lost, destroyed or stolen
Notes.
Section 2.9. Outstanding Notes. The Notes outstanding at any time are
-----------------
all Notes that have been authenticated by the Trustee except for (a) those
canceled by it, (b) those delivered to it for cancellation, (c) to the extent
set forth in Sections 8.1 and 8.2, on or after the date on which the conditions
set forth in Section 8.1 or 8.2 have been satisfied, those Notes
34
theretofore authenticated and delivered by the Trustee hereunder and (d) those
described in this Section 2.9 as not outstanding. Subject to Section 2.10, a
Note does not cease to be outstanding because the Company or one of its
Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.8, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser in whose hands such Note is a
legal, valid and binding obligation of the Company.
If the principal amount of any Note is considered to be paid under
Section 4.1, it ceases to be outstanding and interest thereon shall cease to
accrue.
If the Paying Agent holds, in its capacity as such, on the Stated
Maturity of a Note, on any Redemption Date or on any Payment Date, money
sufficient to pay all accrued interest and principal with respect to such Notes
payable on that date and is not prohibited from paying such money to the Holders
thereof pursuant to the terms of this Indenture, then on and after that date
such Notes cease to be outstanding and interest on them ceases to accrue.
Section 2.10. Treasury Notes. In determining whether the Holders of
--------------
the required principal amount of Notes have concurred in any direction, waiver
or consent or any amendment, modification or other change to this Indenture,
Notes owned, directly or indirectly, by the Company or an Affiliate of the
Company shall be disregarded as though they were not outstanding, except that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent or any amendment, modification
or other change to this Indenture, only Notes that a Responsible Officer of the
Trustee actually knows are so owned shall be so disregarded.
Section 2.11. Temporary Notes. Until definitive Notes are prepared and
---------------
ready for delivery, the Company may prepare and the Trustee shall, upon receipt
of a Company Order, authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes. Until such exchange, temporary Notes shall be
entitled to the same rights, benefits and privileges as definitive Notes.
Section 2.12. Cancellation. The Company at any time may deliver Notes
------------
to the Trustee for cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Notes surrendered to them for registration of
transfer, exchange, payment or purchase. The Trustee shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement,
cancellation or purchase and shall dispose of all canceled Notes in accordance
with its customary procedures (in each case subject to the record retention
requirement of the Exchange Act) unless the Company directs the Trustee to
return such Note to the Company, and, if so destroyed or disposed of, shall
deliver a certificate of disposition thereof to the Company. The Company may not
reissue or resell, or issue new Notes to replace Notes that the Company
35
has redeemed, paid or purchased, or that have been delivered to the Trustee for
cancellation; provided that the Company may re-issue Notes in accordance with
Section 2.7.
Section 2.13. Defaulted Interest. If the Company defaults on a payment
------------------
of interest on the Notes, it shall pay the defaulted interest plus (to the
extent permitted by law) any interest payable on the defaulted interest, in each
case at the interest rate per annum set forth on the face of the Notes and in
accordance with the terms hereof, to (a) the Persons who are Holders of
Definitive Registered Notes, if any, on a subsequent special record date, which
date shall be at least five Business Days prior to the payment date for such
defaulted interest, and (b) if the Global Note is outstanding on such payment
date, to the Holder of the Global Note on such payment date. The Company shall
fix such special record date and payment date in a manner reasonably
satisfactory to the Trustee. At least 15 days before such special record date,
the Company shall mail to each Holder of Definitive Registered Notes, if any,
and, if the Global Note is still outstanding, to the Holder thereof and the
Depositary, a notice that states the special record date, the payment date and
the amount of defaulted interest or interest payable on such defaulted interest,
if any, to be paid.
Section 2.14. CUSIP, CINS or ISIN Number. The Company in issuing the
--------------------------
Notes may use a CUSIP, CINS or ISIN number, and, if so, such CUSIP, CINS or ISIN
number shall be included in notices of redemption, repurchase or exchange as a
convenience to Holders, provided, however, that any such notice may state that
no representation is made as to the correctness or accuracy of the CUSIP, CINS
or ISIN number printed in the notice or on the Notes, and that reliance may be
placed only on the other identification numbers printed on the Notes. The
Company shall promptly notify the Trustee of any change in the CUSIP, CINS or
ISIN number.
Section 2.15. Deposit of Moneys. Prior to 12:00 noon, New York City
-----------------
time, on each Interest Payment Date on which interest is payable in cash, at the
Stated Maturity of the Notes, on each Redemption Date, on each Payment Date and
on the Business Day immediately following any acceleration of the Notes pursuant
to Section 6.2, the Company shall deposit with the Paying Agent in immediately
available funds money (in United States dollars) sufficient to make cash
payments, if any, due on such Interest Payment Date, Stated Maturity, Redemption
Date, Payment Date or Business Day, as the case may be, in a timely manner which
permits the Trustee to remit payment to the Holders on such Interest Payment
Date, Stated Maturity, Redemption Date, Payment Date or Business Day, as the
case may be.
ARTICLE THREE
REDEMPTION
Section 3.1. Right of Redemption. The Notes may be redeemed at the
-------------------
election of the Company, in whole or in part, at any time on or after July 15,
2004 and from time to time thereafter prior to maturity, upon not less than 30
nor more than 60 days' prior notice mailed by first-class mail to each Holder's
last address as it appears in the Register, in amounts of $1,000
36
principal amount at maturity or an integral multiple of $1,000 principal amount
at maturity, at a Redemption Price set forth in the Notes plus accrued and
unpaid interest, if any, to but excluding, the Redemption Date (subject to the
right of Holders of record on the relevant Regular Record Date to receive
interest due on an interest payment date that is on or prior to the Redemption
Date).
Section 3.2. Notices to Trustee. If the Company elects to redeem Notes
------------------
pursuant to Section 3.1, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed.
The Company shall give such notice provided for in this Section 3.2 in
an Officers' Certificate at least 60 days before the Redemption Date (unless a
shorter period shall be satisfactory to the Trustee).
Section 3.3. Selection of Notes to Be Redeemed. If less than all of
---------------------------------
the Notes are to be redeemed at any time, the Trustee shall select the Notes to
be redeemed in compliance with the requirements, as certified to it by the
Company, of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not listed on a national securities
exchange, on a pro rata basis, by lot or by such other method as the Trustee in
its sole discretion shall deem fair and appropriate; provided that no Notes of $
1,000 in principal amount at maturity or less shall be redeemed in part.
The Trustee shall make the selection from the Notes outstanding and
not previously called for redemption. Notes in denominations of $1,000 in
principal amount at maturity may only be redeemed in whole. The Trustee may
select for redemption portions (equal to $ 1,000 in principal amount at maturity
or any integral multiple thereof) of Notes that have denominations larger than
$1,000 in principal amount at maturity. Provisions of this Indenture that apply
to Notes called for redemption also apply to portions of Notes called for
redemption. The Trustee shall notify the Company and the Registrar promptly in
writing of the Notes or portions of Notes to be called for redemption.
Section 3.4. Notice of Redemption. With respect to any redemption of
--------------------
Notes pursuant to Section 3.1, at least 30 days' but not more than 60 days'
before a Redemption Date, the Company shall mail a notice of redemption by first
class mail to each Holder whose Notes are to be redeemed.
The notice shall identify the Notes (including CUSIP numbers) to be
redeemed and shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
37
(iii) the name and address of the Paying Agent;
(iv) that Notes called for redemption must be surrendered to the
Paying Agent in order to collect the Redemption Price;
(v) that, unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date and the only remaining right of the Holders is to
receive payment of the Redemption Price plus accrued interest to the
Redemption Date upon surrender of the Notes to the Paying Agent;
(vi) that, if any Note is being redeemed in part, the portion of the
principal amount (equal to $1,000 in principal amount at maturity or any
integral multiple thereof) of such Note to be redeemed and that, on and
after the Redemption Date, upon surrender of such Note, a new Note or Notes
in principal amount at maturity equal to the unredeemed portion thereof
shall be reissued; and
(vii) that, if any Note contains a CUSIP, CINS, ISIN or other
identification number as provided in Section 2.14, no representations
being made as to the correctness of the CUSIP, CINS, ISIN or other
identification number either as printed on the Notes or as contained in the
notice of redemption and that reliance may be placed only on the other
identification numbers printed on the Notes.
At the Company's request contained in a Company Order (which request
may be revoked by the Company at any time prior to the time at which the Trustee
shall have given such notice to the Holders), made to the Trustee at least 1.5
days before mailing the notice to Holders referred to in Section 3. 1, the
Trustee shall give such notice of redemption in the name and at the expense of
the Company. If, however, the Company gives such notice to the Holders, the
Company shall concurrently deliver to the Trustee an Officers' Certificate
stating that such notice has been given.
Section 3.5. Effect of Notice of Redemption. Once notice of redemption
------------------------------
is mailed, Notes called for redemption become due and payable on the Redemption
Date and at the Redemption Price. Upon surrender of any Notes to the Paying
Agent, such Notes shall be paid at the Redemption Price, plus accrued and unpaid
interest, if any to the Redemption Date.
Section 3.6. Deposit of Redemption Price. On or prior to any
---------------------------
Redemption Date, the Company shall deposit with the Paying Agent (or, if the
Company is acting as its own Paying Agent, shall segregate and hold in trust as
provided in section 2.5) money sufficient to pay the Redemption Price of, and
accrued and unpaid interest on all Notes to be redeemed on that date other than
Notes or portions thereof called for redemption on that date that have been
delivered by the Company to the Trustee for cancellation.
38
Section 3.7. Payment of Notes Called for Redemption. If notice of
--------------------------------------
redemption has been given to Holders in the manner provided above, the Notes or
portion of Notes specified in such notice to be redeemed shall become
irrevocably due and payable on the Redemption Date at the Redemption Price
stated therein, together with accrued interest to such Redemption Date, and on
and after any such Redemption Date (unless the Company shall default in the
payment of Notes to be redeemed on such date at the Redemption Price, plus
accrued interest to the Redemption Date, in which case the principal, until
paid, shall bear interest from the Redemption Date at the rate prescribed in the
Notes), such Notes shall cease to accrue interest. Upon surrender of any Note
for redemption in accordance with a notice of redemption, such Note shall be
paid and redeemed by the Company at the Redemption Price, plus accrued interest
to the Redemption Date; provided that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
registered as such at the close of business on the relevant Regular Record Date.
Section 3.8. Notes Redeemed in Part. Upon cancellation of any Note
----------------------
that is redeemed in part, the Company shall issue and the Trustee shall
authenticate and deliver to the Holder a new Note equal in principal amount at
maturity to the unredeemed portion of such surrendered Note.
ARTICLE FOUR
COVENANTS
Section 4.1. Payment of Notes. The Company shall pay the principal
----------------
of, premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes and this Indenture. An installment of principal, premium,
if any, or interest shall be considered paid on the date due if the Trustee or
Paying Agent (other than the Company, a Subsidiary of the Company, or any
Affiliate of any of them) holds as of 10:00 A.M. New York City time on the due
date money deposited by the Company in immediately available funds and
designated for and sufficient to pay the installment.
Section 4.2. Limitation on Indebtedness. The Company shall not, and
--------------------------
shall not permit any of its Subsidiaries to, Incur any Indebtedness (other than
the Notes and Indebtedness existing on the Closing Date); provided that the
Company may Incur Indebtedness if, after giving effect to the Incurrence of such
Indebtedness and the receipt and application of the proceeds therefrom, the
Consolidated Leverage Ratio would be greater than zero and less than 5:1.
Notwithstanding the foregoing, the Company and any of its Subsidiaries
(except as specified below) may Incur each and all of the following types of
Indebtedness: (i) Indebtedness outstanding at any time in an aggregate principal
amount not to exceed $100 million; (ii) Indebtedness owed (A) to the Company
evidenced by a promissory note or (B) to any Subsidiary of the Company; provided
that any event which results in any such Subsidiary of the Company ceasing to be
a Subsidiary or any subsequent transfer of such Indebtedness (other than the
Company or another Subsidiary of the Company) shall be deemed, in each case, to
39
constitute an Incurrence of such Indebtedness not permitted by this clause
(ii); (iii) Indebtedness issued in exchange for, or the net proceeds of which
are used to refinance or refund, then outstanding Indebtedness (other than
Indebtedness Incurred under clause (i), (ii), (iv), (viii) or (ix) of this
paragraph) and any refinancings thereof in an amount not to exceed the amount so
refinanced or refunded (plus premiums, accrued interest, fees and expenses);
provided that Indebtedness the proceeds of which are used to refinance or refund
the Notes or Indebtedness that is pari passu with, or is subordinated in right
of payment to, the Notes shall only be permitted under this clause (iii) if: (A)
in case the Notes are refinanced in part or the Indebtedness to be refinanced is
pari passu with the Notes, such new Indebtedness, by its terms or by the terms
of any agreement or instrument pursuant to which such new Indebtedness is
outstanding, is expressly made pari passu with, or subordinate in right of
payment to, the remaining Notes, (B) in case the Indebtedness to be refinanced
is subordinated in right of payment to the Notes, such new Indebtedness, by its
terms or by the terms of any agreement or instrument pursuant to which such new
Indebtedness is issued or remains outstanding, is expressly made subordinate in
right of payment to the Notes at least to the same extent that the Indebtedness
to be refinanced is subordinated to the Notes and (C) such new Indebtedness,
determined as of the date of Incurrence of such new Indebtedness, does not
mature prior to the Stated Maturity of the Indebtedness to be refinanced or
refunded, and the Average Life of such new Indebtedness is at least equal to the
remaining Average Life of the Indebtedness to be refinanced or refunded; and
provided further that in no event may Indebtedness of the Company be refinanced
by means of any Indebtedness of any Subsidiary of the Company pursuant to this
clause (iii); (iv) Indebtedness, (A) in respect of performance, surety or appeal
bonds provided in the ordinary course of business, (B) under Currency Agreements
and Interest Rate Agreements; provided that such agreements (a) are designed
solely to protect the Company or its Subsidiaries against fluctuations in
foreign currency exchange rates or interest rates and (b) do not increase the
Indebtedness of the obligor outstanding at any time other than as a result of
fluctuations in foreign currency exchange rates or interest rates or by reason
of fees, indemnities and compensation payable thereunder; and (C) arising from
agreements providing for indemnification, adjustment of purchase price or
similar obligations, or from Guarantees or letters of credit, surety bonds or
performance bonds securing any obligations of the Company or any of its
Subsidiaries pursuant to such agreements, in any case Incurred in connection
with the disposition of any business, assets or a Subsidiary of the Company
(other than Guarantees of Indebtedness Incurred by any Person acquiring all or
any portion of such business, assets or a Subsidiary of the Company for the
purpose of financing such acquisition), in a principal amount not to exceed the
gross proceeds actually received by the Company or of its Subsidiaries in
connection with such disposition; (v) Indebtedness of the Company, to the extent
the net proceeds thereof are promptly (A) used to purchase Notes tendered in an
Offer to Purchase made as a result of a Change in Control or (B) deposited to
defease the Notes as described below under Section 8.2; (vi) Guarantees of the
Notes and Guarantees of Indebtedness of the Company by any of its Subsidiaries;
provided any such Subsidiary Guarantees the Notes; (vii) Indebtedness (including
Guarantees) Incurred to finance the cost (including the cost of design,
development, acquisition, construction, insurance, installation, improvement,
transportation, launch or integration) to acquire satellites, ground systems,
image processing software and systems or other
40
tangible assets used or useful in the satellite imaging and related businesses
of the Company and its Subsidiaries (including acquisitions by way of
Capitalized Leases and acquisitions of the Capital Stock of a Person that
becomes a Subsidiary of the Company to the extent of the fair market value of
the satellites, ground systems, image processing software and systems or other
tangible assets so acquired) by the Company or a Subsidiary of the Company after
the Closing Date; (viii) Indebtedness of the Company not to exceed, at any one
time outstanding, two times: (A) the Net Cash Proceeds received by the Company
after the Closing Date as a capital contribution or from the issuance and sale
of its Capital Stock (other than Redeemable Stock) to a Person that is not a
Subsidiary of the Company, to the extent (I) such capital contribution or Net
Cash Proceeds have not been used pursuant to clause (ii)(b) of the first
paragraph or clause (ii), (iii) or (iv) of the second paragraph of Section 4.3
described below to make a Restricted Payment and (II) if such capital
contribution or Net Cash Proceeds are used to consummate a transaction pursuant
to which the Company Incurs Acquired Indebtedness, the amount of such Net Cash
Proceeds exceeds one-half of the amount of Acquired Indebtedness so Incurred,
and (B) 80% of the fair market value of property, other than cash and cash
equivalents, received by the Company after the Closing Date from the sale of its
Capital Stock (other than Redeemable Stock) to a Person that is not a Subsidiary
of the Company, to the extent (I) such capital contribution or sale of Capital
Stock has not been used pursuant to clause (ii), (iii) or (iv) of the second
paragraph of Section 4.3 described below to make a Restricted Payment and (II)
if such capital contribution or Capital Stock is used to consummate a
transaction pursuant to which the Company Incurs Acquired Indebtedness, 80% of
the fair market value of the property received exceeds one-half of the amount of
Acquired Indebtedness so Incurred, provided that such Indebtedness does not
mature prior to the Stated Maturity of the Notes and has an Average Life longer
than the Notes; (ix) Acquired Indebtedness; (x) Strategic Subordinated
Indebtedness; and (xi) subordinated Indebtedness of the Company, in addition to
Indebtedness permitted under clauses (i) through (x) above, in aggregate
principal amount outstanding at any time not to exceed $100,000,000.
Notwithstanding any other provision of this "Limitation on
Indebtedness" covenant, the maximum amount of Indebtedness that the Company or a
Subsidiary of the Company may Incur pursuant to this Section 4.2 shall not be
deemed to be exceeded, with respect to any outstanding Indebtedness due solely
to the result of fluctuations in the exchange rates of currencies.
For purposes of determining any particular amount of Indebtedness
under this Section 4.2, (1) Guarantees, Liens or obligations with respect to
letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included and (2) any Liens
granted pursuant to the equal and ratable provisions referred to in Section 4.4
described below shall not be treated as Indebtedness. For purposes of
determining compliance with this Section 4.2, in the event that an item of
Indebtedness meets the criteria of more than one of the types of Indebtedness
described in the above clauses, the Company, in its sole discretion, shall
classify, and from time to time may reclassify, such item of Indebtedness and
only be required to include the amount and type of such Indebtedness in one of
such clauses.
41
Section 4.3. Limitation on Restricted Payments. The Company shall not,
---------------------------------
and shall not permit any Subsidiary to, directly or indirectly, (i) declare or
pay any dividend or make any distribution on or with respect to its Capital
Stock (other than (x) dividends or distributions payable solely in shares of its
Capital Stock (other than Redeemable Stock) or in options, warrants or other
rights to acquire shares of such Capital Stock and (y) pro rata dividends or
distributions on Common Stock of Subsidiaries held by minority stockholders,
provided that such dividends do not in the aggregate exceed the minority
stockholders' pro rata share of such Subsidiaries' cumulative net income from
the first day of the fiscal quarter beginning immediately following the Closing
Date), (ii) purchase, redeem, retire or otherwise acquire for value any shares
of Capital Stock of (A) the Company (including options, warrants or other rights
to acquire such shares of Capital Stock) held by any Person or (B) a Subsidiary
(including options, warrants or other rights to acquire such shares of Capital
Stock) held by any Affiliate of the Company (other than a Wholly Owned
Subsidiary) or any holder (or any Affiliate of such holder) of 5% or more of the
Capital Stock of the Company, (iii) make any voluntary or optional principal
payment, or voluntary or optional redemption, repurchase, defeasance, or other
acquisition or retirement for value, of Indebtedness of the Company that is
subordinated in right of payment to the Notes (other than the purchase,
repurchase or the acquisition of Indebtedness in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in each case
due within one year of the date of acquisition) or (iv) make any Investment,
other than a Permitted Investment, in any Person (such payments or any other
actions described in clauses (i) through (iv) being collectively "Restricted
----------
Payments") if, at the time of, and after giving effect to, the proposed
--------
Restricted Payment: (A) a Default or Event of Default shall have occurred and be
continuing or (B) the aggregate amount of all Restricted Payments (the amount,
if other than in cash, to be determined in good faith by the Board of Directors,
whose determination shall be conclusive and evidenced by a Board Resolution)
made after the Closing Date shall exceed the sum of (1) 50% of the aggregate
amount of the Adjusted Consolidated Net Income (or, if the Adjusted Consolidated
Net Income is a loss, minus 100% of the amount of such loss) (determined by
excluding income resulting from transfers of assets by the Company or a
Subsidiary to a Subsidiary) accrued on a cumulative basis during the period
(taken as one accounting period) beginning on the first day of the fiscal
quarter immediately following the Closing Date and ending on the last day of the
last fiscal quarter preceding the Transaction Date for which reports have been
made available to the holders of the Notes plus (2) the aggregate Net Cash
Proceeds received by the Company after the Closing Date from the issuance and
sale of its Capital Stock (other than Redeemable Stock) to a Person who is not a
Subsidiary of the Company or from the issuance to a Person who is not a
Subsidiary of the Company of any options, warrants or other rights to acquire
Capital Stock of the Company (in each case, exclusive of any Redeemable Stock or
any options, warrants or other rights that are redeemable at the option of the
holder, or are required to be redeemed, prior to the Stated Maturity of the
Notes) plus (3) an amount equal to the net reduction after the Closing Date in
Investments (other than reductions in Permitted Investments) in any Person
resulting from payments of interest on Indebtedness, dividends, repayments of
loans or advances, or other transfers of assets, in each case to the Company or
any Subsidiary or from the Net Cash Proceeds from the sale of any such
Investment (except, in each case, to the extent any such proceeds are included
in the calculation
42
of Adjusted Consolidated Net Income), not to exceed, in each case, the amount of
Investments previously made by the Company or any Subsidiary in such Person.
The foregoing provision shall not be violated by reason of: (i) the
payment of any dividend within 60 days after the date of declaration thereof if,
at said date of declaration, such payment would comply with the foregoing
paragraph; (ii) the repurchase, redemption or other acquisition of Capital Stock
of the Company (or options, warrants or other rights to acquire such Capital
Stock) (x) in exchange for, or out of the proceeds of a capital contribution or
a substantially concurrent offering of, shares of Capital Stock (other than
Redeemable Stock) of the Company or (y) for cash in an aggregate amount not to
exceed $2,000,000 in any calendar year; (iii) the making of any principal
payment or the purchase, redemption, retirement, defeasance or other acquisition
for value of Indebtedness of the Company which is subordinated in right of
payment to the Notes in exchange for, or out of the proceeds of, a capital
contribution or a substantially concurrent offering of shares of the Capital
Stock of the Company (other than Redeemable Stock); (iv) the declaration or
payment of dividends on the Common Stock of the Company following a Public
Equity Offering of such Common Stock, of up to 5% per annum of the Net Cash
Proceeds received by the Company in such Public Equity Offering; (v) payments or
distributions to dissenting stockholders pursuant to applicable law pursuant to
or in connection with a consolidation, merger or transfer of assets; provided
that, in the case of any of the foregoing clauses (i) through (iv) of this
paragraph, no Default or Event of Default shall have occurred and be continuing
or occur as a consequence of the actions or payments set forth therein; (vi) any
purchase, redemption, retirement or other acquisition of Capital Stock deemed to
occur upon exercise of stock options or warrants if such Capital Stock
represents a portion of the exercise price of such options or warrants; or (vii)
repurchases of fractional shares of Capital Stock in connection with the
exercise of stock options or warrants to acquire Capital Stock (other than
Redeemable Stock) of the Company.
Each Restricted Payment permitted pursuant to the preceding paragraph
(other than an exchange of Capital Stock for Capital Stock or Indebtedness
referred to in clause (ii) or (iii) thereof), and the Net Cash Proceeds from any
issuance of Capital Stock referred to in clauses (ii) and (iii), shall be
included in calculating whether the conditions of clause (B) of the first
paragraph of this Section 4.3) have been met with respect to any subsequent
Restricted Payments.
Section 4.4. Limitation on Liens. The Company shall not, and shall not
-------------------
permit any Subsidiary to, create, incur, assume or suffer to exist any Lien
(other than Permitted Liens) on any of its assets or properties of any
character, or any shares of Capital Stock or Indebtedness of any Subsidiary,
without making effective provision for all of the Notes and all other amounts
due under the Indenture to be directly secured equally and ratably with (or, if
the obligation or liability to be secured by such Lien is subordinated in right
of payment to the Notes, prior to) the obligation or liability secured by such
Lien. The Company shall not, and shall not permit any Subsidiary to, create,
incur, assume or suffer to exist any Lien on the First QuickBird Satellite or
the First QuickBird Launch Insurance except, in the case of the First QuickBird
Launch
43
Insurance, Liens thereon in favor of the Collateral Trustee or otherwise
securing the Notes and the 12 1/2% Notes.
Section 4.5. Limitation on Sale-Leaseback Transactions. The Company
-----------------------------------------
shall not, and shall not permit any Subsidiary to, enter into any sale-leaseback
transaction involving any of its assets or properties whether now owned or
hereafter acquired, whereby the Company or a Subsidiary sells or transfers such
assets or properties and then or thereafter leases such assets or properties or
any part thereof or any other assets or properties which the Company or such
Subsidiary, as the case may be, intends to use for substantially the same
purpose or purposes as the assets or properties sold or transferred.
The foregoing restriction shall not apply to any sale-leaseback
transaction if (i) the lease is for a period, including renewal rights, of not
in excess of three years; (ii) the lease secures or relates to industrial
revenue or pollution control bonds; (iii) the transaction is solely between the
Company and any Wholly Owned Subsidiary or solely between Wholly Owned
Subsidiaries; or (iv) the lease relates to any present or future ground station
of the Company or any of its Subsidiaries.
Notwithstanding anything to the contrary in this Indenture, the
Company shall not, and shall not permit any Subsidiary to, enter into any sale-
leaseback transaction involving the First QuickBird Satellite.
Section 4.6. Maintenance of Office or Agency. The Company shall
-------------------------------
maintain an office or agency where the Notes may be surrendered for registration
of transfer or exchange or for presentation for payment and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company shall give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 12.2.
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. The
Company shall give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.
The Company hereby initially designates the Corporate Trust Office of
the Trustee as such office of the Company in accordance with Section 2.3.
Section 4.7. Repurchase of Notes upon a Change of Control. The Company
--------------------------------------------
must commence, within 30 days of the occurrence of a Change of Control, and must
thereafter consummate an Offer to Purchase for all Notes then outstanding, at a
purchase price equal to
44
101% of the Accreted Value of such Notes on the relevant Payment Date, plus
accrued interest (if any) to the Payment Date.
Section 4.8. Existence. Subject to Articles Four and Five of this
---------
Indenture, the Company shall do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each Subsidiary in accordance with the respective organizational documents of
the Company and each such Subsidiary and the rights (whether pursuant to
charter, partnership certificate, agreement, statute or otherwise), licenses and
franchises of the Company and each such Subsidiary; provided that the Company
shall not be required to preserve any such right, license or franchise, or the
existence of any Subsidiary (other than of the Company), if the maintenance or
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries taken as a whole; and provided further that any
Subsidiary may consolidate with, merge into, or sell, convey, transfer, lease or
otherwise dispose of all or part of its property and assets to the Company or
any Wholly Owned Subsidiary.
Section 4.9. Payment of Taxes and Other Claims. The Company shall pay
---------------------------------
or discharge and shall cause each Subsidiary to pay or discharge, or cause to be
paid or discharged, before the same shall become delinquent (i) all material
taxes, assessments and governmental charges levied or imposed upon (a) the
Company or any such Subsidiary, (b) the income or profits of any such Subsidiary
which is a corporation or (c) the property of the Company or any such Subsidiary
and (ii) all material lawful claims for labor, materials and supplies that, if
unpaid, might by law become a Lien upon the property of the Company or any such
Subsidiary; provided that the Company shall not be required to pay or discharge,
or cause to be paid or discharged, any such tax, assessment, charge or claim the
amount, applicability or validity of which is being contested in good faith by
appropriate proceedings or by the Company and its Subsidiaries where the failure
to effect such payment is not adverse in any material respect to the Holders.
Section 4.10. Maintenance of Properties and Insurance. (a) General.
---------------------------------------
The provisions of this Section 4.10(a) shall be superseded by Section 4.10(b)
below with respect to the intentional ignition of the launch vehicle for, and
the subsequent operation of, the First QuickBird Satellite only. The Company
shall use its best efforts to obtain and maintain in full force and effect with
respect to each and every satellite (other than the First QuickBird Satellite),
and each permitted replacement satellite therefor, launch insurance with respect
to each such satellite, in each case for a period which the Company deems
reasonable by comparison with other companies in a similar industry but in no
event for a period less than 30 days commencing on the date of intentional
ignition of the launch vehicle. Such insurance must be sufficient to cover an
amount equal to or greater than the sum of (i) the cost to replace such
satellite and launch vehicle, (ii) the cost to launch a replacement satellite
and (iii) the cost of launch insurance for such satellite or, in the event that
the Company has reason to believe that the cost of obtaining comparable
insurance for a replacement satellite would be materially higher, the Company's
best estimate of the cost of such comparable insurance. The insurance policy
required to be obtained
45
pursuant to this Section 4.10(a) shall provide that if 95% or more of a
satellite's capacity is lost, the full amount of insurance shall become due and
payable, and that if a satellite is able to maintain more than 15% but less than
95% of its capacity, a portion of such insurance based on the lost capacity
shall become due and payable.
In the event that the Company receives proceeds from insurance
relating to any satellite pursuant to this Section 4.10(a), the Company may
use a portion of such proceeds to repay any vendor or third-party purchase money
financing pertaining to such satellite that is required to be repaid by reason
of the loss giving rise to such insurance proceeds. Until such time as the
Company shall have at least two satellites operating in orbit (x) if the Company
does not have any satellites in orbit, the Company shall use the remainder of
such proceeds to develop, construct, launch and insure a replacement high
resolution satellite of comparable or superior utility as compared with the
satellite being replaced and to develop the necessary supporting infrastructure
for the replacement satellite and shall use its best efforts to launch such
replacement satellite within nine months of the scheduled launch or of the
launch failure giving rise to the loss proceeds and (y) if the Company shall
then have only one satellite in orbit, as soon as practicable after loss of a
satellite and, in any event, no more than 28 months after such scheduled launch
or launch failure, the Company shall use the remainder of such proceeds to
develop, construct, launch and insure a second high resolution satellite of
comparable or superior utility as the satellite being replaced. If a
constellation of two satellites has been successfully launched and continues to
remain operating in orbit, the Company may use such insurance proceeds for the
development or construction of additional satellites or further development of
the Company as the Board of Directors determined is in the best interests of the
Company.
(b) Special Provisions Relating to First QuickBird Satellite.
Notwithstanding the generality of Section 4.10(a), with respect to the
intentional ignition of the launch vehicle for, and any operation following such
ignition of, the First QuickBird Satellite, the provisions of this Section
4.10(b) shall apply. The Company has obtained, and shall maintain in full force
and effect after the Closing Date, launch insurance with respect to the First
QuickBird Satellite, in each case for a period which the Company deems
reasonable by comparison with other companies in a similar industry but in no
event for a period less than two years commencing on the date of intentional
ignition of the launch vehicle. Such insurance shall name the Collateral Trustee
as sole loss payee thereof and must be sufficient to cover an amount equal to or
greater than the sum of (a) the cost to replace such satellite and launch
vehicle, (b) the cost to launch a replacement satellite and (c) the cost of
launch insurance for such satellite or, in the event that the Company has reason
to believe that the cost of obtaining comparable insurance for a replacement
satellite would be materially higher, the Company's best estimate of the cost of
such comparable insurance, but in no event shall the amount of such insurance at
any time after the Closing Date be less than the sum of (i) $56,000,000 and (ii)
$130,000,000, plus any amounts paid in respect of any underwriting discounts and
commissions, fees, expenses and other costs payable by the Company and
associated with the issuance of the Notes and accrued interest on the Notes for
the period from the Closing Date through the earlier of June 30, 2000 and the
date the First QuickBird Satellite is launched; provided that in the event
premiums are not at any time fully
46
paid for in respect of such launch insurance solely by reason of the fact that
premiums previously paid have been returned by the relevant insurance companies,
the Company shall not thereby be in default of its obligations under this
sentence, provided that all such returned premiums have been distributed to the
Collateral Trustee in accordance with the provisions of the Security Documents
and any amounts subsequently made available to the Company by the Collateral
Trustee in accordance with the Security Documents are immediately used for the
purchase of launch insurance complying with this sentence. The insurance policy
required to be obtained pursuant to this Section 4.10(b) shall provide that if
95% or more of a satellite's capacity is lost, the full amount of insurance
shall become due and payable, and that if a satellite is able to maintain more
than 15% but less than 95% of its capacity, a portion of such insurance based on
the lost capacity shall become due and payable.
The Collateral Trustee shall be the sole loss payee on the First
QuickBird Launch Insurance and all proceeds, if any, from any First QuickBird
Launch Insurance shall be paid directly to the Collateral Trustee for
application to the Notes and the 12 1/2% Notes in accordance with the provisions
of the Security Documents. In the event that, notwithstanding the fact that the
Collateral Trustee shall be the sole loss payee with respect to the First
QuickBird Launch Insurance, the Company or any Subsidiary at any time shall
receive any proceeds relating to the First QuickBird Launch Insurance from the
relevant insurance company or from any source other than the Collateral Trustee
in accordance with the Security Documents, the Company shall cause such proceeds
to be held in trust for the benefit of the Collateral Trustee and immediately
turned over to the Collateral Trustee in the same form received with appropriate
endorsements.
Section 4.11. Rating of Notes. The Company shall use its best efforts
---------------
to obtain a rating for the Notes from either Xxxxx'x or S&P, or if neither firm
is then in the business of providing such ratings, from another nationally
recognized statistical rating organization, as defined in Rule 436 of the
Securities Act at any time after the later of (i) the date that is one year
after the Closing Date and (ii) the date that is six months after the launch of
the First QuickBird Satellite, such rating must be kept in effect with respect
to the Notes through the maturity or redemption of the Notes.
Section 4.12. Repurchase of Notes upon an Insurance Proceeds Payment.
------------------------------------------------------
The Company shall commence within 30 days of receipt by the Collateral Trustee
of any proceeds under the First QuickBird Launch Insurance, and consummate, an
Offer to Purchase the Notes and an offer to purchase the 12 1/2% Notes on a pro
rata basis in an aggregate amount equal to the insurance proceeds not previously
subject to an Offer to Purchase. The purchase price for the Notes and the
12 1/2% Notes in connection with such Offer to Purchase shall equal 100% of the
Accreted Value of such Indebtedness on the Payment Date, plus accrued and unpaid
interest, if any, to such date. If the aggregate purchase price of the Notes and
the 12 1/2% Notes tendered in connection with such Offer to Purchase is less
than the insurance proceeds, the remaining insurance proceeds shall be paid over
to the Company and may be used for general corporate purposes.
47
Section 4.13. Compliance Certificates. Both of the two principal
-----------------------
accounting officers of the Company shall certify, on or before a date not more
than 90 days after the end of each fiscal year of the Company, that a review has
been conducted of the activities of the Company and its Subsidiaries, and the
Company's and its Subsidiaries' performance under the Indenture and that the
Company has fulfilled all obligations thereunder, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
and the nature and status thereof. The Company shall also notify the Trustee of
any default or defaults in the performance of any covenants or agreements under
the Indenture. The Company shall also comply with the other provisions of
Section 314(a) of the TIA.
Section 4.14. Notice of Defaults. In the event that the Company
------------------
becomes aware of any Event of Default, the Company, promptly after it becomes
aware thereof, shall deliver to the Trustee an Officer's Certificate specifying
such Event of Default and what actions the Company, is taking or proposes to
take with respect thereto.
Section 4.15. Commission Reports and Reports to Holders. At all times
-----------------------------------------
from and after the earlier of (i) the commencement of an exchange offer or
effectiveness of a Shelf Registration Statement (the "Registration") and (ii)
------------
the date that is one year after the Closing Date, whether or not the Company is
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, or any successor provision thereto, the Company shall file with the
Commission (to the extent permitted under the Exchange Act) on or prior to the
date they are or would have been required to file such with the Commission (the
"Required Filing Date") pursuant to such Section 13 or 15(d), or any successor
--------------------
provision thereto, annual and quarterly consolidated financial statements
substantially equivalent to financial statements and such other information
(including reports on Form 8-K as if the Company were required to file such
reports) that would have been included in reports filed with the Commission if
the Company was subject to the requirements of Section 13 or 15(d), or any
successor provision thereto, of the Exchange Act, including, with respect to
annual information only, a report thereon by such reporting entity's certified
independent public accountants (which must be a nationally known accounting
firm) as such would be required in such reports to the Commission and, in the
case of annual and quarterly reports, together with a management's discussion
and analysis of financial condition and results of operations which would be so
required. The Company shall supply the Trustee and each holder of Notes, or
shall supply to the Trustee for forwarding to each holder, without cost to such
holder, copies of such reports or other information. At all times prior to the
Registration, upon the request of any Holder of Notes or any prospective
purchaser, the Company shall supply such Holder or prospective purchaser with
the information required under Rule 144A under the Securities Act.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
48
Section 4.16. Waiver of Stay, Extension or Usury Laws. The Company
---------------------------------------
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of, premium, if any, or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or that may affect the
covenants or the performance of the Indenture, and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law and covenants that it shall not 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 had been enacted.
Section 4.17. Other Consents. Notwithstanding any other provision of
--------------
this Indenture, neither the amendments to the Amended and Restated Indenture,
dated as of April 8, 1999, relating to the 12 1/2% Notes nor the amendment to
the Collateral Pledge and Security Agreement, dated as of April 8, 1999, as
amended, is prohibited or restricted by any term, covenant, condition or
provision of the Indenture, the Notes, the 12 1/2% Notes or the security
Documents, will constitute a Default ro Event of Default or shall require the
prepayment of the Notes.
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.1. Consolidation, Merger and Sale of Assets. The Company
----------------------------------------
shall not consolidate with, merge with or into, or sell, convey, transfer, lease
or other-wise dispose of all or substantially all of its property and assets (as
an entirety or substantially an entirety in one transaction or a series of
related transactions) to, any Person or permit any Person to merge with or into
the Company unless:
(i) the Company shall be the continuing Person, or the Person (if
other than the Company) formed by such consolidation or into which the
Company is merged or that acquired or leased such property and assets of
the Company shall be a corporation organized and validly existing under the
laws of the United States of America or any jurisdiction thereof and shall
expressly assume, by a supplemental indenture, executed and delivered to
the Trustee and the Collateral Trustee, all of the obligations of the
Company on all of the Notes and under the Indenture;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing; and
49
(iii) the Company provides to the Trustee an Officers' Certificate and
Opinion of Counsel, in each case stating that such consolidation, merger
or transfer and such supplemental indenture complies with this provision
and that all conditions precedent provided for herein relating to such
transaction have been complied with.
Section 5.2. Successor Substituted. Upon any consolidation or merger,
---------------------
or any sale, conveyance, transfer or other disposition of all or substantially
all of the property and assets of the Company in accordance with Section 5.1 of
this Indenture, the successor Person formed by such consolidation or into which
the Company is merged or to which such sale, conveyance, transfer or other
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor Person had been named as the Company herein and thereafter,
except in the case of lease, the predecessor Person shall be relieved of all
obligations and covenants under this Indenture and the Notes.
ARTICLE SIX
DEFAULT AND REMEDIES
Section 6.1. Events of Default. An "Event of Default" shall occur
----------------- ----------------
with respect to the Notes if.
(a) default in the payment of principal of (or premium, if any, on)
any Note when the same becomes due and payable at maturity, upon
acceleration, redemption or otherwise;
(b) default in the payment of interest on any Note when the same
becomes due and payable, and such default continues for a period of 30
days;
(c) the failure to make or consummate an Offer to Purchase in
accordance with Sections 4.7 and 4.12 hereof;
(d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in the Indenture or under the Notes
(other than a default specified in clause (a), (b) or (c) above) or under
the Security Documents and such default or breach continues for a period of
30 consecutive days after written notice by the Trustee or the Holders of
25% or more in aggregate principal amount at maturity of the Notes;
(e) there occurs with respect to any issue or issues of Indebtedness
of the Company or any Significant Subsidiary having an outstanding
principal amount of $1,000,000 or more in the aggregate for all such
issues of all such Persons, whether such Indebtedness now exists or shall
hereafter be created, (I) an event of default that has caused the holder
thereof to declare such Indebtedness to be due and payable prior to its
50
Stated Maturity and such Indebtedness has not been dischargeded in full or
such acceleration has not been rescinded or annulled within 30 days of such
acceleration and/or (II) the failure to make a principal payment at the
final (but not any interim) fixed maturity and such defaulted payment shall
not have been made, waived or extended within 30 days of such payment
default and/or (III) with respect to Indebtedness represented by the 12
1/2% Notes, there shall occur any default in the performance or observance
of any term, condition, covenant or agreement contained therein or in any
agreement relating thereto, or any other event specified in any such
Indebtedness or agreement, if the effect thereof is to cause, or permit the
holder or holders of such Indebtedness (or any trustee or other
representative of any such holder(s)) to cause, such Indebtedness to become
due prior to its Stated Maturity;
(f) any final judgment or order (not covered by insurance) for the
payment of money in excess of $1,000,000 in the aggregate for all such
final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any Significant Subsidiary and shall not be
paid or discharged, and there shall be any period of 30 consecutive days
following entry of the final judgment or order that causes the aggregate
amount for all such final judgments or orders outstanding and not paid or
discharged against all such Persons to exceed $1,000,000 during which a
stay of enforcement of such final judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
(g) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Company or any Significant
Subsidiary in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, (B) appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Company or any Significant Subsidiary or for all or
substantially all of the property and assets of the Company or any
Significant Subsidiary or (C) the winding up or liquidation of the affairs
of the Company or any Significant Subsidiary and, in each case, such decree
or order shall remain unstayed and in effect for a period of 60 consecutive
days;
(h) the Company or any Significant Subsidiary (A) commences a
voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (C) effects any
general assignment for the benefit of creditors; or
(i) with respect to the First QuickBird Satellite, there shall occur
the loss of 15% or more of such satellite's capacity or any other event
that permits or requires the
51
payment of any proceeds of the First QuickBird Launch Insurance by the
insurance company thereunder and, in either such case, such proceeds are
not paid over to the Collateral Trustee within 90 days of the demand being
made under the applicable First QuickBird Launch Insurance policy.
Section 6.2. Acceleration. If an Event of Default (other than an Event
------------
of Default specified in clause (g) or (h) above that occurs with respect to the
Company) occurs and is continuing under the Indenture, the Trustee or the
Holders of at least 25% in aggregate principal amount at maturity of the Notes
then outstanding, by written notice to the Company (and to the Trustee if such
notice is given by the Holders), may, and the Trustee at the request of such
Holders shall, declare the Accreted Value of, premium, if any, and accrued
interest on the Notes to be immediately due and payable. Upon a declaration of
acceleration, such Accreted Value of, premium, if any, and accrued interest
shall be immediately due and payable. In the event of a declaration of
acceleration because an Event of Default set forth in clause (e) above has
occurred and is continuing, such declaration of acceleration shall be
automatically rescinded and annulled if the event of default triggering such
Event of Default pursuant to clause (e) shall be remedied or cured by the
Company or the relevant Significant Subsidiary or waived by the holders of the
relevant indebtedness within 60 days after the declaration of acceleration with
respect thereto. If an Event of Default specified in clause (g) or (h) above
occurs with respect to the Company, the Accreted Value of, premium, if any, and
accrued interest on the Notes then outstanding shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
Section 6.3. Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of, Accreted Value of, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes, the Security Documents or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding.
Section 6.4. Waiver of Past Defaults. Subject to Sections 6.2, 6.7 and
-----------------------
9.2, the Holders of at least a majority in aggregate principal amount at
maturity of the outstanding Notes, by written notice to the Company and to the
Trustee, may waive an existing Default or Event of Default and its consequences,
except a Default in the payment of Accreted Value of, premium, if any, or
accrued interest on any Note as specified in clause (a) or (b) of Section 6.1 or
in respect of a covenant or provision of this Indenture which cannot be modified
or amended without the consent of the holder of each outstanding Note affected.
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereto.
52
Section 6.5. Control by Majority. The Holders of at least a majority
-------------------
in aggregate principal amount at maturity of the outstanding Notes may direct
the time, method and place of conducting any proceeding for any remedy available
to the Trustee or exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that conflicts with law
or this Indenture, that may involve the Trustee in personal liability, or that
the Trustee determines in good faith may be unduly prejudicial to the rights of
Holders of Notes not joining in the giving of such direction and may take any
other action it deems proper that is not inconsistent with any such direction
received from Holders of Notes.
Section 6.6. Limitation on Suits. A Holder may not pursue any remedy
-------------------
with respect to the Indenture or the Notes unless:
(i) the Holder gives the Trustee written notice of a continuing
Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount at
maturity of outstanding Notes make a written request to the Trustee to
pursue the remedy;
(iii) such Holder or Holders offer the Trustee indemnity satisfactory
to the Trustee against any costs, liability or expense;
(iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of a majority in
aggregate principal amount at maturity of the outstanding Notes do not give
the Trustee a direction that is inconsistent with the request.
Section 6.7. Rights of Holders to Receive Payment. Subject to Sections
------------------------------------
6.4 and 9.2, notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of Accreted Value of, premium, if any,
or interest on, such Note or to bring suit for the enforcement of any such
payment on or after the due date expressed in the Notes shall not be impaired or
affected without the consent of such Holder; provided, however, that no recourse
for the payment of the Accreted Value of, premium, if any, or interest on any of
the Notes or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indentures, the Security Documents or in any of the Notes or because of the
creation of any Indebtedness represented thereby shall be had against any
incorporator, stockholder, officer, director, employee or controlling person of
the Company or of any successor Person thereof. Each Holder, by accepting the
Notes, waives and releases all such liability.
53
Section 6.8. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee. The Company covenants that if
-------
(a) default is made in the payment of any installment of interest on
any Note when such interest becomes due and payable and such default
continues for a period of 30 days, or
(b) default is made in the payment of the principal of (or premium,
if any, on) any Note at the due date thereof,
the Company shall, upon demand of the Trustee, pay to the Trustee for the
benefit of the Holders of such Notes, the whole amount then due and payable on
such Notes for principal (and premium, if any) and interest, and interest on any
overdue principal (and premium, if any) and, to the extent that payment of such
interest shall be legally enforceable, upon any overdue installment of interest,
at the rate borne by the Notes, and, in addition thereto, 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.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Notes and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon the Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
Section 6.9. Trustee May File Proofs of Claim. In case of the pendency
--------------------------------
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment composition or other judicial proceeding relative to the
Company or any other obligor upon the Notes or the property of the Company or of
such other obligor or their creditors, the Trustee (irrespective of whether the
principal of the Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have made
any demand on the Company for the payment of overdue principal, premium, if any,
or interest) shall be entitled and empowered, by intervention in which
proceeding or otherwise:
(i) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Notes and
to file such other papers
54
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 of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the ranking of such payments directly to the Holders, to pay
the Trustee any amount due 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.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
Section 6.10. Priorities. If the Trustee collects any money pursuant
----------
to this Article Six, it shall pay out the money in the following order:
First: to the Trustee for all amounts due under Section 7.7;
Second: to Holders for amounts then due and unpaid for principal of,
premium, if any, and interest, if any, on the Notes in respect of which or for
the benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the amounts due and payable on such Notes
for principal, premium, if any, any interest, if any, respectively; and
Third: the balance, if any, to the Person or Persons entitled thereto.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Holders pursuant to this Section
6.10.
Section 6.11. Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court may require any party
litigant in such suit to file an undertaking to pay the costs of the suit, and
the court may assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in the suit having due regard to the merits
and good faith of the claims or defenses made by the party litigant. This
Section 6.11 does not apply to a
55
suit by the Trustee, a Suit by a Holder pursuant to Section 6.7 of this
Indenture, or a suit by Holders of more than 10% in principal amount of the
outstanding Notes.
Section 6.12. Restoration of Rights and Remedies. If the Trustee or
----------------------------------
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then,
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Company, the Trustee and the Holders shall continue as though no
such proceeding had been instituted.
Section 6.13. Rights and Remedies Cumulative. Except as otherwise
------------------------------
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes in Section 2.8, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 6.14. Delay or Omission Not Waiver. No delay or omission of
----------------------------
the Trustee or of any Holder to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein. Every right and remedy
given by this Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be
ARTICLE SEVEN
TRUSTEE
Section 7.1. General. The duties and responsibilities of the Trustee
-------
shall be as provided by the TIA and as set forth herein. Whether or not herein
expressly so provided every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Article Seven.
Section 7.2. Certain Rights of Trustee. Subject to TIA Sections
-------------------------
315(a) through (d):
(a) except during the continuance of an Event of Default, the Trustee
undertakes to perform such duties and only such duties as are specifically
set forth in this Indenture, and no implied covenants or obligations shall
be read into this Indenture against the Trustee and in the absence of bad
faith on its part, the Trustee may
56
conclusively rely, as to the truth and correctness of the statements and
certificates or opinions furnished to it and conforming to the requirements
of this Indenture, but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Indenture;
(b) in case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs;
(c) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Order and any resolution of the Board
of Directors may be sufficiently evidenced by a Board Resolution;
(d) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate;
(e) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(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 pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(g) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney;
(h) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either director or by or through agents or
attorneys and the Trustee
57
shall not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed with due care by it hereunder: and
(1) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or within
the discretion or rights or powers conferred upon it by this Indenture.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
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 its Affiliates with the same rights it
would have if it were not the Trustee. Any Agent may do the same with like
rights. However, the Trustee is subject to TIA Sections 310(b) and 311.
Section 7.4. Trustee's Disclaimer. The Trustee (i) makes no
--------------------
representation as to the validity or adequacy of this Indenture, the Security
Documents or the Notes, (ii) shall not be accountable for the Company's use or
application of the proceeds from the Notes and (iii) shall not be responsible
for any statement contained herein, in the Security Documents or in the Notes
other than its certificate of authentication. The Trustee shall not be charged
with knowledge of any Default or Event of Default unless (i) a Responsible
Officer of the Trustee assigned to its Corporate Trustee Administration
Department (or successor department or group) shall have actual knowledge
thereof or (ii) the Trustee shall have received written notice thereof at its
Corporate Trust office from the Company or any Holder. No provision of this
Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Section 7.5. Notice of Default. If any Default or any Event of Default
-----------------
occurs and is continuing and if such Default or Event of Default is known to a
trust officer of the Trustee, the Trustee shall mail to each Holder in the
manner and to the extent provided in TIA Section 313(c) notice of such Default
or Event of Default within 90 days after it occurs, unless such Default or Event
of Default has been cured; provided, however, that, except in the case of a
default in the payment of the principal of, premium, if any, or interest on any
Note, the Trustee shall be protected in withholding such notice if and so long
as the board of directors, the executive committee or a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interest of the Holders.
58
Section 7.6. Reports by Trustee to Holders. To the extent required by
-----------------------------
TIA Section 313(a), within 60 days after May 15 of each year commencing with
1999 and for as long as there are Notes outstanding hereunder, the Trustee shall
mail to each Holder the Trustee's brief report dated as of such date that
complies with TIA Section 313(a). The Trustee also shall comply with TIA Section
313(b) and TIA Section 313(c) and (d). A copy of such report at the time of its
mailing to Holders shall be filed with the Commission and each stock exchange,
if any, on which the Notes are listed.
The Company shall promptly notify the Trustee if the Notes become
listed on any stock exchange, and the Trustee shall comply with TIA Section
313(d).
Section 7.7. Compensation and Indemnity. The Company shall pay to the
--------------------------
Trustee from time to time such compensation as shall be agreed upon in writing
for its services. The reasonable compensation of the Trustee shall not be
limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Trustee upon request for all reasonable out-of-pocket
expenses and advances incurred or made by the Trustee. Such expenses shall
include the reasonable compensation and expenses of the Trustee's agents and
counsel.
The Company shall indemnify the Trustee for, and hold it harmless
against, any and all loss, damage, claim or liability or expense, including
taxes (other than taxes based on the income of the Trustee), incurred by it
without negligence or bad faith on its part in connection with the acceptance or
administration of this Indenture and the Security Documents and its duties under
this Indenture, the Security Documents and the Notes, including, without
limitation, the costs and expenses of defending itself against any claim or
liability and of complying with any process served upon it or any of its
officers in connection with the exercise or performance of any of its powers or
duties under this Indenture, the Security Documents and the Notes.
To secure the Company's payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, in its capacity as Trustee, except money or property
held in trust to pay principal of, premium, if any, and interest on particular
Notes.
Without prejudice to any other rights available to the Trustee under
applicable law, if the Trustee incurs expenses or renders services after the
occurrence of an Event of Default specified in clause (g) or (h) of Section 6.1,
the expenses and the compensation for the services shall be intended to
constitute expenses of administration under Title 11 of the United States
Bankruptcy Code or any applicable federal or state law for the relief of
debtors.
The provisions of this Section 7.7 shall survive the termination of
this Indenture.
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 successors Trustee's acceptance of appointment as provided in this Section
7.8.
59
The Trustee may resign at any time by so notifying the Company in
writing at least 30 days prior to the date of the proposed resignation. The
Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by so notifying, the Trustee in writing and may appoint a successor
Trustee with the consent of the Company. The Company may at any time remove the
Trustee, by Company Order given at least 30 days prior to the date of the
proposed removal; provided that at such date no Event of Default shall have
occurred and be continuing.
Except as provided in the second sentence of the preceding paragraph,
if the Trustee resigns or is removed, or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor Trustee.
Within one year after the successor Trustee takes office, the Holders of a
majority in principal amount of the outstanding Notes may appoint a successor
Trustee to replace the successor Trustee appointed by the Company. If the
successor Trustee does not deliver its written acceptance required by the next
succeeding paragraph of this Section 7.8 within 30 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of a majority in principal amount of the outstanding Notes may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after the
delivery of such written acceptance, subject to the lien provided in Section
7.7, (i) the retiring Trustee shall transfer all property held by it as Trustee
to the successor Trustee, (ii) the resignation or removal of the retiring
Trustee shall become effective and (iii) the successor Trustee shall have all
the rights, powers and duties of the Trustee under this Indenture and the
Security Documents. A successor Trustee shall mail notice of its succession to
each Holder.
If the Trustee is no longer qualified or eligible under Section 7.10,
any Holder who satisfies the requirements of TIA Section 310(b) may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
The Company shall give notice of any resignation and any removal of
the Trustee and each appointment of a successor Trustee to all Holders. Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.
Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue indefinitely for
the benefit of the retiring Trustee.
Section 7.9. Successor Trustee by Merger, Etc . If the Trustee
--------------------------------
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation or national banking
association, the resulting, surviving or transferee
60
corporation or national banking association without any further act shall be the
successor Trustee with the same effect as if the successor Trustee had been
named as the Trustee herein.
Section7.10. Eligibility. This Indenture shall always have a Trustee
-----------
that satisfies the requirements of TIA Section 310(a)(1) and (5). The Trustee
shall have a combined capital and surplus of at least $50,000.000 as set forth
in its most recent published annual report of condition. The Trustee shall be
subject to TIA Section 310(b), subject to the penultimate paragraph thereof.
Section 7.11. Money Held in Trust. The Trustee shall not be liable for
-------------------
interest on any money received by it except as the Trustee may agree 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, and except for money held in
trust under Article Eight of this Indenture and money held in trust pursuant to
the Security Documents.
Section 7.12. Withholding Taxes. The Trustee, as agent for the
-----------------
Company; shall exclude and withhold from each payment of principal and interest
and other amounts due hereunder or under the Notes any and all U.S. withholding
taxes applicable thereto as required by law. The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Notes, to withhold such amounts and timely pay the
same to the appropriate authority in the name of and on behalf of the Holders of
the Notes, that it shall file any necessary withholding tax returns or
statements when due, and that, as promptly as possible after the payment
thereof, it shall deliver to each Holder of a Note appropriate documentation
showing the payment thereof, together with such additional documentary evidence
as such Holders may reasonably request from time to time.
ARTICLE EIGHT
DISCHARGE OF INDENTURE
Section 8.1. Termination of Company's Obligations. Except as
------------------------------------
otherwise provided in this Section 8.1., the Company may terminate its
obligations under the Notes and this Indenture if.
(a) all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes that have been replaced or Notes for whose
payment money or securities have theretofore been held in trust and
thereafter repaid to the Company, as provided in Section 8.5) have been
delivered to the Trustee for cancellation and the Company has paid all sums
payable by it hereunder, or
(b) (i) all such Notes mature within one year or all of them are to
be called for redemption within one year under arrangements satisfactory to
the Trustee for giving the notice of redemption, (ii) the Company
irrevocably deposits in trust with the Trustee
61
during such one-year period, under the terms of an irrevocable trust
agreement in form satisfactory to the Trustee, as trust funds solely for
the benefit of the Holders of such Notes for that purpose, money or U.S.
Government Obligations sufficient (in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee), without consideration of
any reinvestment, of any interest thereon, to pay principal, premium. if
any, and interest on such Notes to maturity or redemption, as the case may
be, and to pay all other sums payable, by it hereunder, (iii) no Default or
Event of Default with respect to the Notes shall have occurred and be
continuing on the date of such deposit, (iv) such deposit shall not result
in a breach or violation of, or constitute a default under, this Indenture
of any other agreement or instrument to which the Company is a party or by
which it is bound, (v) if at such time the Notes are listed on a national
securities exchange, the Company has delivered to the Trustee an Opinion of
Counsel stating that the Notes shall not be delisted as a result of such
deposit, defeasance and discharge, and (vi) the Company has delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel, in each
case stating that all conditions precedent provided for herein relating to
the satisfaction and discharge of this Indenture have been complied with.
With respect to the foregoing clause (a), the Company's obligations
under Section 7.7 shall survive. With respect to the foregoing clause (b), the
Company's obligations in Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.8, 2.9, 2.14,
4.1, 7.7, 7.8, 8.3, 8.4 and 8.5 shall survive until the Notes have matured or
have been redeemed. Thereafter, only the Company's obligations in Sections 7.7,
8.4 and 8.5 shall survive. After any such irrevocable deposit, the Trustee upon
request shall acknowledge in writing the discharge of the Company's obligations
under the Notes and this Indenture, except for those surviving obligations
specified above.
Section 8.2. Defeasance of Certain Obligation. The Company may omit
--------------------------------
to comply with any term, provision or condition set forth in Sections 4.2
through 4.14 and 4.17 (except for any covenant otherwise required by the TIA),
and clauses (c), (d), (e) and (f) of Section 6.1 shall be deemed not to be
Events of Default, in each case with respect to the outstanding Notes if:
(a) with reference to this Section 8.3, the Company has irrevocably
deposited or caused to be irrevocably deposited with the Trustee and
conveyed all right, title and interest to the Trustee for the benefit of
the Holders, under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee as trust funds in trust, specifically
pledged to the Trustee for the benefit of the Holders as security for
payment of the principal of, premium, if any, and interest, if any, on the
Notes, and dedicated solely to, the benefit of the Holders, in and to (i)
money in an amount, (ii) U.S. Government Obligations that, through the
payment of interest and principal in respect thereof in accordance with
their terms, shall provide, not later than one day before the due date of
any payment referred to in this clause (a), money in an amount or (iii) a
combination thereof in an amount sufficient, in the opinion of a nationally
recognized
62
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, without
consideration of the reinvestment of such interest and after payment of all
federal, State and local taxes or other charges and assessments in respect
thereof payable by the Trustee, the principal of, premium, if any, and
interest on the outstanding Notes on the Stated Maturity or upon earlier
redemption of such principal or interest; provided that the Trustee shall
have been irrevocably instructed to apply such money or the proceeds of
such U.S. Government Obligations to the payment of such principal, premium,
if any, and interest with respect to the Notes and to give any related
notice of redemption;
(b) such deposit shall not result in a breach or violation of, or
constitute a default under, this Indenture or any other 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.
(c) immediately after giving effect to such deposit or a pro forma
basis, no Default or Event of Default, or event that after the giving of
notice or lapse of time or both would become a Default or Event of Default,
shall have occurred and be continuing on the date of such deposit or during
the period ending on the 123rd day after the day of such deposit;
(d) the Company has delivered to the Trustee an Opinion of Counsel to
the effect that (i) the creation of the defeasance trust does not violate
the Investment Company Act of 1940, (ii) the Holders shall not recognize
income, gain or loss for federal income tax purposes as a result of such
deposit and the defeasance of the obligations referred to in the first
paragraph of this Section 8.3 and shall be subject to federal income tax
on the same amount and in the same manner and at the same times as would
have been the case if such deposit and defeasance had not occurred and
(iii) after the passage of 123 days following the deposit (except with
respect to any trust funds for the account of any Holder who may be deemed
to be "connected" with the Company for purposes of the Insolvency Xxx 0000
after two years following the deposit), the trust funds shall not be
subject to the effect of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code
or Section 15 of the New York Debtor and Creditor Law, and either (A) the
trust funds shall no longer remain the property of the Company (and
therefore shall not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally) or (B) if a court were to rule under any such law in any case or
proceeding that the trust funds remained property of the Company (1)
assuming such trust funds remained in the possession of the Trustee prior
to such court ruling to the extent not paid to the Holders, the Trustee
shall hold, for the benefit of the Holders, a valid and perfected security
interest in such trust funds that is not avoidable in bankruptcy or
otherwise and (2) no property, rights in property or other interests
granted to the Trustee or the Holders in exchange for, or with respect to,
such trust funds shall be subject to any prior rights or holders of other
Indebtedness of the Company or any of its Notes;
63
(e) if at such time the Notes are listed on a national securities
exchange, the Company has delivered to the Trustee an Opinion of Counsel to
the effect that the Notes shall not be delisted as a result of the
Company's exercise of its option under this Section 8.2; and
(f) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, in each case stating that all conditions
precedent provided for herein relating to the defeasance contemplated by
this Section 8.2 have been complied with.
Section 8.3. Application of Trust Money. Subject to Section 8.5, the
--------------------------
Trustee or Paying Agent shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 8.1 or 8.2, as the case may be, and shall
apply the deposited money and the money from U.S. Government Obligations in
accordance with the Notes and this Indenture to the payment of principal of,
premium, if any, and interest on the Notes; but such money need not be
segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 8.1 or 8.2 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 outstanding Notes and other than any such tax,
fee or other charge incurred due to the negligence or bad faith of the Trustee
in connection with the acceptance or administration of this Indenture and the
Security Documents and its duties under this Indenture, the Security Documents
and the Notes.
Section 8.4. Repayment to Company. Subject to Sections 7.7, 8.1 and
--------------------
8.2, the Trustee and the Paying Agent shall promptly pay to the Company upon
request set forth in an Officers' Certificate any excess money held by them at
any time and thereupon shall be relieved from all liability with respect to such
money. The Trustee and the Paying Agent shall pay to the Company any money held
by them for the payment of principal, premium, if any, or interest that remains
unclaimed for two years; provided that the Trustee or such Paying Agent before
being required to make any payment may cause to be published at the expense of
the Company once in a newspaper of general circulation in the City of New York
or mail to each Holder entitled to such money notice that such money remains
unclaimed and that after a date specified therein (which shall be at least 30
days from the date of such publication or mailing) any unclaimed balance of such
money then remaining shall be repaid to the Company. After payment to the
Company. Holders entitled to such money must look to the Company for payment as
general creditors unless an applicable law designates another Person, and all
liability of the Trustee and such Paying Agent with respect to such money shall
cease.
Section 8.5. Reinstatement. If the Trustee or Paying Agent is unable
-------------
to apply any money or U.S. Government Obligations in accordance with Section 8.1
or 8.2, as the case may be, by reason of any legal proceeding or by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the
64
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.1 or 8.2, as
the case may be, until such time as the Trustee or Paying Agent is permitted to
apply ill such money or U.S. Government Obligations in accordance with Section
8.1 or 8.2, as the case may be; provided that, if the Company has made any
payment of principal of, premium, if any, or interest on any Notes because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the money or
U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1. Without Consent of Holders. The Company, when authorized
--------------------------
by Board Resolution, and the Trustee may amend or supplement this Indenture, the
Notes and the Security Documents (or provide a direction to the Collateral
Trustee to amend the Security Documents) without notice to or the consent of any
Holder:
(a) to cure any ambiguity, defect or inconsistency in this Indenture,
the Notes and the Security Documents; provided that such amendments or
supplements shall not adversely affect the interests of the Holders in any
material respect;
(b) to comply with Article Five and to provide for amendments,
modifications or supplements to the Security Documents pursuant to
Section 10.1 (including amendments. modifications and supplements for the
purpose of including the 12 1/2% Notes as part of the obligations secured
by the Collateral) and to add Collateral to the Collateral securing the
Notes:
(c) to add to the covenants of the Company for the benefit of the
Holders or any right or power herein conferred upon the Company;
(d) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes; or
(e) to add any additional Events of Default.
Section 9.2. With Consent of Holders. Subject to Sections 6.4 and 6.7
-----------------------
and without prior notice to the Holders, the Company, when authorized by its
Board of Directors (as evidenced by a Board Resolution), and the Trustee may
amend this Indenture, the Notes and the Security Documents (or provide a
direction to the Collateral Trustee to amend the Security Documents) with the
consent of the Holders of not less than a majority in aggregate principal amount
at maturity of the Notes then outstanding.
65
Notwithstanding the provisions of this Section 9.2, without the
consent of each Holder affected an amendment or waiver including a waiver
pursuant to Section 6.4. may not:
(i) change the Stated Maturity of the principal of or any
installment of interest on any Note;
(ii) reduce the Accreted Value of, or premium, if any, or interest
on, any Note;
(iii) change the place or currency of payment of principal of, or
premium, if any, or interest on, any Note;
(iv) impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity (or, in the case of a redemption, on or
after the Redemption Date) of any Note;
(v) reduce the above-stated percentage of outstanding Notes the
consent of whose Holders is necessary to modify or amend the Indenture;
(vi) waive a default in the payment of principal of, premium, if
any, or interest on the Notes;
(vii) alter the obligation of the Company to purchase the Notes in
accordance with this Indenture following the occurrence of a Change of Control
or waive any default in the performance thereof, or
(viii) reduce the percentage or aggregate principal amount at maturity
of outstanding Notes the consent of whose Holders is necessary for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults.
Notwithstanding the provisions of this Section 9.2, without the
consent of the Holders of not less than 66 2/3% in aggregate principal amount
at maturity of the Notes then outstanding, the Trustee shall not direct the
Collateral Trustee to, or otherwise permit the release of any Collateral except
as expressly provided in the Security Documents.
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, supplement
or waiver, but it shall be sufficient if such consent approves the substance
thereof
After an amendment, supplement or waiver under this Section 9.2
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing such amendment, supplement or waiver. The Company
shall mail supplemental indentures to Holders upon request. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture or waiver.
66
Section 9.3. Revocation and Effect of Consent. Until an amendment or
--------------------------------
waiver becomes effective, a consent to it by a Holder is a continuing consent by
the Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the Note of the consenting Holder, even if notation
of the consent is not made on any Note. However, any such Holder or subsequent
Holder may revoke the consent as to its Note or portion of its Note. Such
revocation shall be effective only if the Trustee receives the notice of
revocation before the date any such amendment, supplement or waiver becomes
effective. An amendment, supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite percentage
in principal amount at maturity of the outstanding Notes.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder unless it is of the type described in any of clauses (i)
through (vii) of Section 9.2. In case of an amendment or waiver of the type
described in clauses (i) through (vii) of Section 9.2, the amendment or waiver
shall bind each Holder who has consented to it and every subsequent Holder of a
Note that evidences the same indebtedness as the Note of such consenting Holder.
Section 9.4. Notation on or Exchange of Notes. If an amendment,
--------------------------------
supplement or waiver changes the terms of a Note, the Trustee may require the
Holder to deliver such Note to the Trustee. The Trustee may place an appropriate
notation on the Note about the changed terms and return it to the Holder and the
Trustee may place an appropriate notation on any Note thereafter authenticated.
Alternatively, if the Company or the Trustee so determines, the Company in
exchange for the Note shall issue and the Trustee shall authenticate a new Note
that reflects the changed terms.
Section 9.5. Trustee to Sign Amendments, Etc. The Trustee shall be
-------------------------------
entitled to receive, and shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture. The Trustee shall execute any such amendment, supplement or waiver
upon satisfaction of the conditions precedent thereto contained herein, unless
such amendment, supplement or waiver adversely, affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
Section 9.6. Conformity with Trust Indenture Act. Every supplemental
-----------------------------------
indenture executed pursuant to this Article Nine shall conform to the
requirements of the TIA as then in effect.
Section 9.7. Payments for Consent. The Company shall not, and shall
--------------------
not permit any Subsidiary to, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture, the Notes, or the Security Documents unless
such consideration is offered to be paid or is paid to all Holders that so
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or amendment.
67
ARTICLE TEN
SECURITY
Section 10.1. Security. (a) The Company shall enter into the Security
--------
Documents and comply with the terms and provisions thereof. The purpose of the
Security Documents is to provide the Trustee with an interest in the First
QuickBird Launch Insurance and any and all proceeds thereof which shall be
shared, pari passu, with the interest therein of the holders of the 12 1/2%
Notes as provided in the Security Documents. It is the intent that (i) the
interest of the Trustee (through the Collateral Trustee) in such First QuickBird
Launch Insurance not be less than an amount sufficient to provide for the
aggregate Accreted Value of, and any premium and accrued interest on, the Notes
from the Closing Date through the earlier of June 30, 2000 and the date of the
first intentional ignition of the launch vehicle for the First QuickBird
Satellite and (ii) the aggregate interest of the Collateral Trustee in such
First QuickBird Launch Insurance not be less than the sum of (x) the amount
provided in clause (i) of this sentence plus (y) $56,000,000. The Trustee and
the Collateral Trustee are authorized to enter into such modifications,
amendments and supplements to the Security Documents for the purpose of
effectively securing the 12 1/2% Notes on a pari passu basis with the Notes as
provided in this Section 10.1.
(b) Each Holder, by its acceptance of a Note, consents and agrees to
the terms of the Security Documents as the same may be in effect or may be
amended from time to time in accordance with its terms, and authorizes and
directs the Trustee and the Collateral Trustee to enter into the Security
Documents and to perform its respective obligations and exercise its respective
rights thereunder in accordance therewith. Without limiting the generality of
the foregoing, each Holder, by its acceptance of a Note, agrees that in the
event of any distribution in respect of the Collateral by the Trustee or the
Collateral Trustee, such distribution shall be treated as a prepayment, without
premium, of the Note to the extent of such distribution, and the principal
amount of the Note as of such date, and any Accrued Interest, shall be deemed
reduced by the aggregate amount of any such distribution in respect of the Note.
(c) The Company shall do, or cause to be done, all such acts and
things as may be necessary or proper, or as may be required by the provisions of
the Security Documents, to assure and confirm to the Collateral Trustee the
security and other interest in the Collateral contemplated thereby, by the
Security Documents or any part thereof, as from time to time constituted, so as
to render the same available for the security and benefit of this Indenture and
of the Notes secured and otherwise provided hereby and thereby, according to the
intent and purposes herein and therein expressed. The Company shall take, or
shall cause to be taken, upon request of the Trustee, any and all actions
reasonably required to cause the Security Documents to create and maintain, as
security for the obligations of the Company under this Indenture and the Notes,
valid and enforceable first priority liens in and on all the Collateral, in
favor of the Collateral Trustee, superior to and prior to the rights of all
third Persons and subject to no other Liens other than as provided herein.
68
(d) The release of any Collateral pursuant to the Security Documents
shall not be deemed to impair the security under this Indenture in contravention
of the provisions hereof if and to the extent any Collateral is released
pursuant to this Indenture and the Security Documents. To the extent applicable,
the Company shall cause TIA Section 314(d) relating to the release of property
or securities from the Lien and security interest of the Security Documents and
relating to the substitution therefor of any property or securities to be
subjected to the Lien and security interest of the Security Documents to be
complied with. Any certificate or opinion required by TIA Section 314(d) may be
made by an officer of the Company, except in cases where TIA Section 314(d)
requires that such certificate or opinion be made by an independent Person,
which Person shall be an independent engineer, appraiser or other expert
selected or approved by the Trustee in the exercise of reasonable care.
(e) The Company shall cause TIA Section 314(b), relating to opinions
of counsel regarding the Lien under the Security Documents, to be complied with.
The Trustee may, to the extent permitted by Sections 7.1 and 7.2 hereof, accept
as conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such instruments.
(f) The Trustee may, in its sole discretion and without the consent
of the Holders, on behalf of the Holders, take all actions it deems necessary or
appropriate in order to (i) enforce or cause the enforcement of any of the terms
of the Security Documents and (ii) collect and receive any and all amounts
payable in respect of the obligations of the Company thereunder. The Trustee
shall have power to institute and to maintain such suits and proceedings as the
Trustee may deem expedient to preserve or protect its interests and the
interests of the Holders in respect of the Collateral (including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders or of the
Trustee).
ARTICLE ELEVEN
INTENTIONALLY OMITTED
ARTICLE TWELVE
MISCELLANEOUS
Section 12.1. Trust Indenture Act of 1939. This Indenture shall be
---------------------------
subject to the provisions of the TIA that are required to be a part of this
Indenture and shall, to the extent applicable, be governed by such provisions.
Section 12.2. Notices. Any notice or communication shall be
-------
sufficiently given if in writing and delivered in person or mailed by first
class mail or telecopier communication (promptly confirmed in writing),
addressed as follows, and received by the addressee:
69
if to the Company:
-----------------
EarthWatch Incorporated
0000 Xxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: President
with a copy to:
Counsel to the Company
Xxxxxx Godward LLP
0000 Xxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxx C.T. Linfield, Esq.
if to the Trustee:
-----------------
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Trustee Administration
The Company, the Trustee or the Depositary by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder of a Certificated Note
shall be mailed to him at his address as it appears on the Register by first
class mail and shall be sufficiently given to him if so mailed within the time
prescribed. Copies of any such communication or notice to a Holder shall also be
mailed to the Trustee and each Agent at the same time.
Failure to mail a notice or communication to a Holder as provided
herein or any defect in it shall not affect its sufficiency with respect to
other Holders. Except for a notice to the Trustee, which is deemed given only
when received, and except as otherwise provided in this Indenture, if a notice
or communication is mailed in the manner provided in this Section 12.2, it is
duly given, whether or not the addressee receives it.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be
70
filed with the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Section 12.3. 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 stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 12.4. Statements Required in Certificate or Opinion. Each
---------------------------------------------
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(a) a statement that each person signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statement or opinion contained in such
certificate or opinion is based;
(c) a statement that, in the opinion of each such person, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with; provided,
however, that, with respect to matters of fact, an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
Section 12.5. Acts of Holders. (a) Any request, demand, authorization,
---------------
direction, notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing; and,
71
except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is hereby expressly required, to the Company. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section 12.5.
(b) The ownership of Notes shall be proved by the Register.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Note shall bind every future Holder
of the same Note or the Holder of every Note issued upon the transfer thereof or
in exchange therefor or in lieu thereof, in respect of anything done, suffered
or omitted to be done by the Trustee, any Paying Agent or the Company in
reliance thereon, whether or not notation of such action is made upon such Note.
(d) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver of other act, the
Company may, at its option, by or pursuant to a Board Resolution, fix in advance
a record date for the determination of such Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other act,
but the Company shall have no obligation to do so. Notwithstanding TIA Section
316(c), any such record date shall be the record date specified in or pursuant
to such Board Resolution, which shall be a date not more than 30 days prior to
the first solicitation of Holders generally in connection therewith and no later
than the date such solicitation is completed.
If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other act may be given before or after
such record date, but only the Holders of record at the close of business on
such record date shall be deemed to be Holders for purposes of determining
whether Holders of the requisite proportion of Notes then outstanding have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other act, and for this purpose the
Notes then outstanding shall be computed as of such record date; provided that
no such request, demand, authorization, direction, notice, consent, waiver or
other act by the Holders on such record date shall be deemed effective unless it
shall become effective pursuant to the provisions of this Indenture not later
than six months after the record date.
Section 12.6. Rules by Trustee, Paying Agent or Registrar. The
-------------------------------------------
Trustee may make reasonable rules for action by or at a meeting of Holders. The
Paying Agent or Registrar may make reasonable rules for its functions.
Section 12.7. Agent for Service; Submission to Jurisdiction, Waiver
-----------------------------------------------------
of Immunities. By the execution and delivery of this Indenture, the Company (i)
-------------
acknowledges that it has designated and appointed its President as its
authorized agent upon which process may be served in any suit, action or
proceeding arising out of or relating to the Notes or this Indenture that may be
instituted in any federal or state court in the State of New York, Borough of
72
Manhattan, or brought under federal or state securities laws or brought by the
Trustee (whether in its individual capacity or in its capacity as Trustee
hereunder), and acknowledges that its President has accepted such designation,
(ii) submits to the non-exclusive jurisdiction of any such court in any such
suit, action or proceeding, and (iii) agrees that service of process upon its
President and written notice of said service to the Company (mailed or delivered
to its General Counsel at its principal office as specified in Section 12.2)
shall be deemed in every respect effective service of process upon it in any
such suit or proceeding. The Company further agrees to take any and all action,
including the execution and filing of any and all such documents and instruments
as may be necessary to continue such designation and appointment of its
President in full force and effect so long as this Indenture shall be in full
force and effect or any of the Notes shall be outstanding.
To the extent that the Company has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, the
Company hereby irrevocably waives such immunity in respect of its obligations
under this Indenture and the Notes, to the extent permitted by law.
Section 12.8. Payment Date Other than a Business Day. If an Interest
--------------------------------------
Payment Date, Redemption Date, Payment Date or Stated Maturity of any Note shall
not be a Business Day, then payment of principal of, premium, if any, or
interest on such Note, as the case may be, need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the Interest Payment Date. Payment Date or Redemption Date, or at
the Stated Maturity of such Note, provided that no interest shall accrue for the
period from and after such Interest Payment Date, Payment Date, Redemption Date
or Stated Maturity, as the case may be.
Section 12.9. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
-------------
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK.
Section 12.10. No Adverse Interpretation of Other Agreement. This
--------------------------------------------
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any Subsidiary of the Company. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
Section 12.11. No Recourse Against Others. No recourse for the
--------------------------
payment of the principal of, premium, if any, or interest on any of the Notes,
or for any claim based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the Company contained in
this Indenture, the Security Documents or in any of the Notes, or because of the
creation of any Indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer, director, employee or controlling person, as
such, of the Company or of any successor Person thereof, either directly or
through the Company or any
73
successor Person, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise, it being
expressly understood that all such liability is hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture, the Security Documents and the issue of the Notes.
Section 12.12. Successors. All agreements of the Company in this
----------
Indenture and the Notes shall bind its successors. All agreements of the Trustee
in this Indenture shall bind its successors.
Section 12.13. Duplicate Originals. The parties may sign any number of
-------------------
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
Section 12.14. Separability. In case any provision in this Indenture
------------
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 12.15. Table of Contents, Headings, Etc. The Table of
--------------------------------
Contents, Cross Reference Table and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof and shall in no way modify or restrict any of the
terms and provisions hereof.
74
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture
to be duly executed, all as of the date first written above.
EARTHWATCH INCORPORATED
By: /s/ Xxxxxx X. Xxxxxxxxx III
------------------------------------
Name: Xxxxxx X. Xxxxxxxxx III
Title: Chief Executive Officer,
President and Director
THE BANK OF NEW YORK, Trustee
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
EXHIBIT A
FORM OF GLOBAL NOTE
[FACE OF NOTE]
THIS NOTE IS INITIALLY ISSUED AS PART OF AN ISSUANCE OF UNITS. EACH OF WHICH
CONSISTS OF ONE 13% SENIOR DISCOUNT NOTE DUE 2007 (A "NOTE") OF EARTHWATCH
INCORPORATED AND 49.095 SHARES OF 8.5% SERIES C CUMULATIVE CONVERTIBLE
REDEEMABLE PREFERRED STOCK OF EARTHWATCH INCORPORATED PRIOR TO THE CLOSE OF
BUSINESS UPON THE EARLIEST TO OCCUR OF (i) THE DATE THAT IS SIX MONTHS AFTER THE
CLOSING DATE, (ii) THE COMMENCEMENT OF THE EXCHANGE OFFER FOR THE NOTES, (iii)
THE EFFECTIVENESS OF A SHELF REGISTRATION STATEMENT WITH RESPECT TO THE NOTES,
OR (iv) A DATE DETERMINED BY XXXXXX XXXXXXX & CO INCORPORATED IN ITS SOLE
DISCRETION. THE NOTES EVIDENCED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED OR
EXCHANGED SEPARATELY FROM, BUT MAY BE TRANSFERRED OR EXCHANGED ONLY TOGETHER
WITH, THE SHARES OF SERIES C PREFERRED STOCK ISSUED BY EARTHWATCH INCORPORATED
IN CONNECTION HEREWITH.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, 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, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS AN "INSTITUTIONAL ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT
WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE 144(k) AS IN EFFECT ON
THE DATE OF SUCH TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO
EARTHWATCH OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED
FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE ACCRETED
VALUE OF NOTES OF LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO
EARTHWATCH THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THE TIME PERIOD
REFERRED TO ABOVE. THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE
TRUSTEE AND EARTHWATCH SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION
AS EITHER MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER AND TRANSFER OF THIS NOTE
IN VIOLATION OF THE FOREGOING RESTRICTIONS.
THIS GLOBAL NOTE IS HELD BY THE TRUSTEE, AS CUSTODIAN FOR THE DEPOSITARY (AS
DEFINED IN THE INDENTURE GOVERNING THIS NOTE) IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (1) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT
IN PART PURSUANT TO SECTION 2.07(a) OF THE INDENTURE AND (11) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF EARTHWATCH
INCORPORATED.
EARTHWATCH INCORPORATED
UNITS, EACH CONSISTING OF ONE 13% SENIOR DISCOUNT NOTE
DUE 2007 AND 49.095 SHARES OF 8.5% SERIES C CUMULATIVE
CONVERTIBLE REDEEMABLE PREFERRED STOCK
199,000 Units CUSIP NO. 000000XX0
No.___
THE UNITS EVIDENCED HEREBY, WHICH ARE COMPRISED OF THE ATTACHED 13% SENIOR
DISCOUNT NOTES DUE 2007 (THE "NOTES") OF EARTHWATCH INCORPORATED (CUSIP NO.
000000XX0) AND THE 8.5% SERIES C CUMULATIVE CONVERTIBLE REDEEMABLE PREFERRED
STOCK, PAR VALUE $.001 PER SHARE (THE "PREFERRED STOCK"), OF EARTHWATCH
INCORPORATED, WERE INITIALLY ISSUED AS PART OF AN ISSUANCE OF 199,000 UNITS.
EACH UNIT CONSISTS OF ONE $1,000 PRINCIPAL AMOUNT AT MATURITY NOTE AND 49.095
SHARES OF PREFERRED STOCK, OF EARTHWATCH INCORPORATED. PRIOR TO THE CLOSE OF
BUSINESS UPON THE EARLIEST TO OCCUR OF (i) THE DATE THAT IS SIX MONTHS AFTER THE
CLOSING DATE OF THIS OFFERING; (ii) THE COMMENCEMENT OF THE EXCHANGE OFFER FOR
THE NOTES; (iii) THE DATE A SHELF REGISTRATION STATEMENT WITH RESPECT TO THE
NOTES BECOMES EFFECTIVE); OR (v) SUCH EARLIER DATE AS DETERMINED BY XXXXXX
XXXXXXX & CO. INCORPORATED IN ITS SOLE DISCRETION, THE NOTES AND PREFERRED STOCK
EVIDENCED BY THE ATTACHED CERTIFICATES MAY ONLY BE TRANSFERRED OR EXCHANGED AS
UNITS.
THE TERMS OF THE NOTES AND PREFERRED STOCK ATTACHED HERETO ARE EXPRESSLY MADE A
PART HEREOF AND NO UNITS MAY BE TRANSFERRED OR EXCHANGED EXCEPT IN ACCORDANCE
WITH THE REQUIREMENTS FOR THE TRANSFER OR EXCHANGE, AS THE CASE MAY BE, OF THE
NOTES AND PREFERRED STOCK.
EARTHWATCH INCORPORATED
13% Senior Discount Note Due 2007
CUSIP No. 000000XX0]
No._________
EARTHWATCH INCORPORATED, a Delaware corporation (the "Company", which
-------
term includes any successor under the Indenture hereinafter referred to), for
value received, promises to pay to _______, or its registered assigns, the
principal sum of _______________ United States Dollars ($______________) on
July 15, 2007.
The following information is supplied for purposes of Sections 1273
and 1275 of the Internal Revenue Code:
Issue Date under the Internal Revenue Code: July 12, 1999
Yield to maturity for period from 13%
Issue/Closing Date to July 15, 2007:
Original issue discount under Section 1273 of $487.22
the Internal Revenue Code (for each $1,000
principal amount at Maturity Date):
Issue Price (for each $ 1,000 principal amount $512.78
at Maturity Date):
Interest Payment Dates: January 15 and July 15, commencing January
15, 2003.
Regular Record Dates: January 1 and July 1.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which provisions shall have the same effect as if
set forth hereon.
A-4
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
Date:
EARTHWATCH INCORPORATED
By:__________________________
Name:
Title:
This is one of the 13% Senior Discount Notes due 2007 described in the within-
mentioned Indenture.
THE BANK OF NEW YORK, Trustee
By:__________________________
Authorized Signatory
A-5
[REVERSE SIDE OF NOTE]
EARTHWATCH INCORPORATED
13% Senior Discount Note due 2007
1 Principal and Interest.
----------------------
EarthWatch Incorporated (the "Company") shall pay the principal of
-------
this Note on July 15, 2007.
The Company promises to pay interest on the principal amount of this
Note on each Interest Payment Date, as set forth below, at the rate per annum
shown above.
Interest on the Notes shall be payable at the rate of 13% per annum
(the "Interest Rate") and shall be payable in U.S. dollars semiannually on
January 15 and July 15 (each, an "Interest Payment Date") to be paid to the
person in whose name this Note is registered as of the close of business on the
Regular Record Date for such interest, which shall be January 1 or July 1
(whether or not a Business Day); provided that no interest shall be payable in
cash on the principal amount of the Notes prior to July 15, 2002, except as
provided in the next paragraph.
From and after July 15, 2002, interest on the Notes shall be payable
semiannually in cash on January 15 and July 15 of each year. Interest on the
Notes shall accrue from the most recent date to which interest has been paid or
duly provided for, or if no interest has been paid or duly provided for, from
July 12, 1999. Interest shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
If an exchange offer registered under the Securities Act of 1933 is
not consummated and a Shelf Registration Statement under the Securities Act with
respect to resales of the Notes is not declared effective by the Commission on
or before August 15, 2000 in accordance with the terms of the Notes Registration
Rights Agreement dated as of July 7, 1999, between the Company and Xxxxxx
Xxxxxxx & Co. Incorporated, interest (in addition to the accrual of original
discount during the period ending July 15, 2002 and in addition to the interest
otherwise due on the Notes after such date) shall accrue from August 15, 2000,
at an annual rate of .5% of the Accreted Value of the Notes on the preceding
Semi-Annual Accrual Date, payable in cash semiannually, in arrears, on January
15 and July 15 of each year, commencing January 15, 2001, until (i) the exchange
offer is consummated, (ii) the Shelf Registration Statement is declared
effective or (iii) the date that the Notes become freely tradable without
registration under the Securities Act; provided that upon the request of any
Holder of the Notes, the Company shall, in accordance with the terms of the
Indenture, deliver to such Holder certificates evidencing such Holder's Notes
without the legends restricting the
A-6
transfer thereof. The Holder of this Note is entitled to the benefits of such
Notes Registration Rights Agreement.
The Company shall pay interest on overdue principal and premium, if
any, and (to the extent lawful) interest on overdue installments of interest at
the rate of 13% per annum.
2. Method of Payment.
-----------------
The Company shall pay principal as provided above and interest on each
Interest Payment Date to the persons who are Holders (as reflected in the
Register at the close of business on each January 1 and July 1 immediately
preceding the Interest Payment Date), in each case, even if the Note is canceled
on registration or transfer or exchange after such Regular Record Date; provided
that, with respect to payment of principal, the Company shall not make payment
to the Holder unless this Note is surrendered to the Paying Agent.
The Company shall pay principal, premium, if any, and as provided
above, interest in money of the United States of America that at the time of
payment is legal tender for payment of public and private debts. However, the
Company may pay principal, premium, if any, and interest by its check payable in
such money. The Company may mail an interest check to a Holder's registered
address (as reflected in the Register). If a payment date is a date other than a
business day at a place of payment, payment may be made at that place on the
next succeeding day that is a Business Day and no interest shall accrue for the
intervening period.
3. Paying Agent and Registrar.
--------------------------
Initially, the Trustee shall act as authenticating agent, Paying Agent
and Registrar. The Company may change any authenticating agent, Paying Agent and
Registrar without notice in accordance with the Indenture. The Company, any
Affiliate or any Subsidiary thereof may act as the Paying Agent or Registrar.
4. Indenture, Limitations.
----------------------
The Company issued the Notes under an Indenture dated as of July 12,
1999 (the "Indenture"), between the Company and The Bank of New York, trustee
---------
(the "Trustee"). Capitalized terms herein are used as defined in the Indenture
-------
unless otherwise indicated. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act. The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Trust Indenture Act for a statement of all such terms.
To the extent permitted by applicable law, in the event of any inconsistency
between the terms of this Note and the terms of the Indenture, the terms of the
Indenture shall control.
5. Security.
--------
A-7
The Notes are secured by the First QuickBird Launch Insurance pursuant
to and as provided in the Security Documents.
6. Redemption.
----------
The Notes may be redeemed at the election of the Company, in whole or
in part, on July 15, 2004 and from time to time thereafter prior to maturity,
upon not less than 30 nor more than 60 days' prior notice mailed by first-class
mail to each Holder's last address as it appears in the Register, in amounts of
$ 1.000 or an integral multiple of $ 1,000, at the Redemption Prices (expressed
as percentages of principal amount at maturity) set forth below, plus accrued
and unpaid interest to the Redemption Date, if redeemed during the 12-month
period beginning on July 15 of the years indicated below:
Year Redemption Price
---- ----------------
2004.................. 106.500%
2005.................. 104.333%
2006.................. 102.167%
2007.................. 100.000%
7. Notice of Redemption.
---------------------
Notice of any optional redemption shall be mailed at least 30 days'
but not more than 60 days' before the Redemption Date to each Holder of Notes to
be redeemed at its last address as it appears in the Register. Notes in original
denominations larger than $ 1,000 may be redeemed in part. On and after the
Redemption Date, interest ceases to accrue on Notes or portions of Notes called
for redemption, unless the Company defaults in the payment of the Redemption
Price.
8. Repurchase upon Change of Control.
----------------------------------
Upon the occurrence of any Change of Control, the Company shall be
obligated to make an offer to purchase all outstanding Notes pursuant to the
Offer to Purchase described in the Indenture at a purchase price equal to 101%
of the Accreted Value thereof at the relevant Payment Date, plus, without
duplication, accrued and unpaid interest, if any, to the Payment Date (the
"Change of Control Payment").
-------------------------
A notice of such Change of Control shall be mailed within 30 days
after any Change of Control occurs to each Holder of Notes at such Holder's
registered address as it appears in the Register. Notes in original
denominations larger than $1,000 may be sold to the Company in part; provided
that Notes shall only be issued in denominations of $ 1,000 principal
A-8
amount at maturity or integral multiples thereof. On and after the Payment Date,
interest ceases to accrue on Notes or portions of Notes surrendered for purchase
by the Company, unless the Company defaults in the payment of the Change of
Control Payment.
9. Repurchase of Notes upon an Insurance Proceeds Payment.
------------------------------------------------------
The Company must commence, within 30 days of receipt by the Collateral
Trustee of any proceeds under the First QuickBird Launch Insurance, and must
thereafter consummate an Offer to Purchase the Notes then outstanding, and an
offer to purchase the 12 1/2% Notes then outstanding, on a pro rata basis in an
aggregate amount equal to the Insurance Proceeds Payment Amount not previously
subject to an Offer to Purchase under Section 4.18 of the Indenture at a
purchase price for the Notes and the 12 1/2% Notes equal to 100% of the accreted
value thereof on the relevant payment date, plus accrued and unpaid interest, if
any, to such payment date. If the aggregate purchase price of the Notes and the
12 1/2% Notes tendered in connection with such offers to purchase is less than
the Insurance Proceeds Payment Amount, the remaining Insurance Proceeds Payment
Amount shall be paid over to the Company and may be used for general corporate
purposes.
10. Denomination; Transfer; Exchange.
--------------------------------
The Notes are in registered form without coupons in denominations of
$1,000 of principal amount at maturity or an integral multiple thereof. A Holder
may register the transfer or exchange of Notes in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
or exchange of any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before the mailing of
a notice of redemption of Notes to be redeemed is made. This Note is a Global
Note.
11. Persons Deemed Owners.
---------------------
The Holder of this Note shall be treated as the owner of this Note for
all purposes.
12. Unclaimed Money.
---------------
If money for the payment of principal, premium, if any, and interest
remains unclaimed for two years, the Trustee and the Paying Agent shall pay the
money back to the Company at its written request. After that, Holders entitled
to the money must look to the Company for payment, unless an applicable law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
A-9
13. Discharge Prior to Redemption or Maturity.
-----------------------------------------
If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Notes (a) to redemption or maturity, the
Company shall be discharged from the Indenture and the notes, except in certain
circumstances for certain sections thereof, and (b) to redemption for the Stated
Maturity, the Company shall be discharged from certain covenants set forth in
the Indenture.
14. Amendment, Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in aggregate principal amount at maturity of the Notes then outstanding, and any
existing default or compliance with any provision may be waived with the consent
of the Holders of at least a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or the consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency and make any change that
does not materially and adversely affect the rights of any Holder.
15. Restrictive Covenants.
----------------------
The Indenture imposes certain limitations on the ability of the
Company and the Restricted Subsidiaries, among other things, incur additional
Indebtedness, to create Liens; make certain Restricted Payments; or enter into
certain Sale-Leaseback transactions. Within 90 days after the end of the last
fiscal quarter of each year, the Company must report to the Trustee on
compliance with such limitations. Notwithstanding any other provision of the
Indenture or the Notes, neither the amendments to the Amended and Restated
Indenture dated as of April 8, 1999, relating to the 12 1/2% Notes, nor the
Collateral Pledge and Security Agreement dated as of April 8, 1999, as amended,
is prohibited or restricted by any term, covenant, condition or provision of
the Indenture, the Notes, the 12 1/2% Notes or the Security Documents, shall
constitute a Default or Event of Default or shall require the prepayment of the
Notes.
16. Successor Persons.
------------------
Generally, when a successor person or other entity assumes all the
obligations of its predecessor under the Notes and the Indenture, the
predecessor person shall be released from those obligations.
17. Defaults and Remedies.
----------------------
A-10
The following events shall be defined as "Events of Default" in
-----------------
the Indenture: (a) default in the payment of principal of (or premium, if any,
on) any Note when the same becomes due and payable at maturity, upon
acceleration, redemption or otherwise; (b) default in the payment of interest on
any Note when the same becomes due and payable, and such default continues for a
period of 30 days; (c) failure to make or consummate an Offer to Purchase in
accordance with Sections 4.7, 4.11 and 4.18 of the Indenture; (d) the Company
defaults in the performance of or breaches any other covenant or agreement of
the Company in the Indenture or under the Notes (other than a default specified
in clause (a), (b) or (c) above) and such default or breach continues for a
period of 30 consecutive days after written notice by the Trustee or the
Holders of 25% or more in aggregate principal amount at maturity of the Notes;
(e) there occurs with respect to any issue or issues of Indebtedness of the
Company or any Significant Subsidiary having an outstanding principal amount of
$1,000,000 or more in the aggregate for all such issues of all such Persons,
whether such Indebtedness now exists or shall hereafter be created, (I) an event
of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such Indebtedness has not been
discharged in full or such acceleration has not been rescinded or annulled
within 30 days of such acceleration and/or (II) the failure to make a principal
payment at the final (but not any interim) fixed maturity and such defaulted
payment shall not have been made, waived or extended within 30 days of such
payment default and/or (III) with respect to Indebtedness represented by the
12 1/2% Notes, there shall occur any default in the performance or observance of
any term, condition, covenant or agreement contained therein or in any agreement
relating thereto, or any other event specified in any such Indebtedness or
agreement, if the effect thereof is to cause, or permit the holder or holders of
such Indebtedness (or any trustee or other representative of any such holder(s))
to cause, such Indebtedness to become due prior to its stated maturity; (f) any
final judgment or order (not covered by insurance) for the payment of money in
excess of $1,000,000 in the aggregate for all such final judgments or orders
against all such Persons (treating any deductibles, self-insurance or retention
as not so covered) shall be rendered against the Company or any Significant
Subsidiary and shall not be paid or discharged, and there shall be any period of
30 consecutive days following entry of the final judgment or order that causes
the aggregate amount for all such final judgments or orders outstanding and not
paid or discharged against all such Persons to exceed $ 1,000,000 during which a
stay of enforcement of such final judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; (g) a court having jurisdiction in
the premises enters a decree or order for (A) relief in respect of the Company
or any Significant Subsidiary in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, (B)
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any Significant Subsidiary or
(for all or substantially all of the property and assets of the Company or any
Significant Subsidiary or (C) the winding up or liquidation of the affairs of
the Company or any Significant Subsidiary and, in each case, such decree or
order shall remain unstayed and in effect for a period of 60 consecutive days;
(h) the Company or any Significant Subsidiary (A) commences a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consents to the entry of an order for relief in an
involuntary case under any such law,
A-11
(B) consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
the Company or any Significant Subsidiary or for all or substantially all of the
property and assets of the Company or any Significant Subsidiary or (C) effects
any general assignment for the benefit of creditors or (i) with respect to the
First QuickBird Satellite, there shall occur the loss the of 15% or more of such
satellite's capacity or any other event that permits or requires the payment of
any proceeds of the First QuickBird Launch Insurance by the insurance company
thereunder and, in either such case, such proceeds are not paid over to the
Collateral Trustee within 90 days of the demand being made under the applicable
QuickBird Launch Insurance policy.
If an Event of Default (other than an Event of Default specified in
clause (g) or (h) above that occurs with respect to the Company) occurs and is
continuing under the Indenture, the Trustee or the Holders of at least 25% in
aggregate principal amount at maturity outstanding, by written notice to the
Company (and to the Trustee if such notice is given by the Holders), may, and
the Trustee at the request of such Holders shall, declare the principal amount
of, premium, if any, and accrued interest on the Notes to be immediately due and
payable. Upon a declaration of acceleration, such principal amount of, premium,
if any, and accrued interest shall be immediately due and payable. In the event
of a declaration of acceleration because an Event of Default set forth in clause
(e) above has occurred and is continuing, such declaration of acceleration shall
be automatically rescinded and annulled if the event of default triggering such
Event of Default pursuant to clause (e) shall be remedied or cured by the
Company or the relevant Significant Subsidiary or waived by the holders of the
relevant Indebtedness within 60 days after the declaration of acceleration with
respect thereto. If an Event of Default specified in clause (g) or (h) above
occurs with respect to the Company, the principal amount of, premium, if any,
and accrued interest on the Notes then outstanding shall ipso facto become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Holder. The Holders of at least a majority in principal
amount at maturity of the outstanding Notes by written notice to the Company and
to the Trustee, may waive all past defaults and rescind and annul a declaration
of acceleration and its consequences if (i) all existing Events of Default,
other than the nonpayment of the principal of, premium, if any, and interest on
the Notes that have become due solely by such declaration of acceleration, have
been cured or waived and (ii) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction.
The Holders of at least a majority in aggregate principal amount at
maturity of the outstanding Notes may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that conflicts with law or the Indenture, that may involve
the Trustee in personal liability, or that the Trustee determines in good faith
may be unduly prejudicial to the rights of Holders of Notes not joining in the
giving of such direction and may take any other action it deems proper that is
not inconsistent with any such direction received from Holders of Notes. A
Holder may not pursue any remedy with respect to
A-12
the Indenture or the Notes unless: (i) the Holder gives the Trustee written
notice of a continuing Event of Default; (ii) the Holders of at least 25% in
aggregate principal amount at maturity of outstanding Notes make a written
request to the Trustee to pursue the remedy; (iii) such Holder or Holders offer
the Trustee indemnity satisfactory to the Trustee against any costs, liability
or expense; (iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and (v) during such
60-day period, the Holders of a majority in aggregate principal amount at
maturity of the outstanding Notes do not give the Trustee a direction that is
inconsistent with the request. However, such limitations do not apply to the
right of any Holder of a Note to receive payment of the principal of, premium,
if any, or interest on, such Note or to bring suit for the enforcement of any
such payment, on or after the due date expressed in the Notes, which right shall
not be impaired or affected without the consent of the Holder.
18. Trustee Dealings with Company.
-----------------------------
The Trustee under the Indenture, in its individual or any other
capacity, may become owner or pledgee of Notes and may otherwise deal with the
Company or its Affiliates with the same rights it would have if it were not the
Trustee.
19. No Recourse Against Others.
--------------------------
No recourse for the payment of the principal of, premium, if any, or
interest on any of the Notes or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture, or in any of the Notes or because of
the creation of any Indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer, director, employee or controlling person of
the Company or of any successor Person thereof. Each Holder, by accepting the
Notes, waives and releases all such liability.
20. Authentication.
--------------
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
21. CUSIP Numbers.
--------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
A-13
This Note shall be governed by and construed in accordance with the
internal laws of the State of New York.
The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to EarthWatch
Incorporated, 0000 Xxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: President.
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.7 or 4.12 of the Indenture, check the box: [_]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.7 of the Indenture, state the amount (in principal amount
at maturity):
$__________________ ($ 1,000 or integral multiple thereof).
Date:_____
Your Signature:________________________________________________________________
Signature Guarantee:________________________
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.12 of the Indenture, state the amount (in principal amount
at maturity):
$______________________ ($1,000 or integral multiple thereof).
Date:__________
Your Signature:________________________________________________________________
Signature Guarantee:/1/ ___________________
___________________________
/1/ The Holder's signature must be guaranteed by a member firm of a registered
national securities exchange or of the National Association of Securities
Dealers, Inc., a commercial bank or trust company having an office or
correspondent in the United States or an "eligible guarantor institution"
as defined by Rule 17Ad-15 under the Exchange Act.
EXHIBIT B
FORM OF DEFINITIVE REGISTERED NOTE
[FACE OF NOTE]
THIS NOTE IS INITIALLY ISSUED AS PART OF AN ISSUANCE OF UNITS, EACH OF WHICH
CONSISTS OF ONE 13% SENIOR DISCOUNT NOTE DUE 2007 OF EARTHWATCH INCORPORATED
AND 49.095 SHARES OF 8.5% SERIES C CUMULATIVE CONVERTIBLE REDEEMABLE PREFERRED
STOCK OF EARTHWATCH INCORPORATED. PRIOR TO THE CLOSE OF BUSINESS UPON THE
EARLIEST TO OCCUR OF (i) THE DATE THAT IS SIX MONTHS AFTER THE CLOSING DATE
(ii) THE COMMENCEMENT OF THE EXCHANGE OFFER FOR THE NOTES (iii) THE
EFFECTIVENESS OF A SHELF REGISTRATION STATEMENT WITH RESPECT TO THE NOTES, OR
(iv) A DATE DETERMINED BY XXXXXX XXXXXXX & CO INCORPORATED IN ITS SOLE
DISCRETION, THE NOTES EVIDENCED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED OR
EXCHANGED SEPARATELY FROM. BUT MAY BE TRANSFERRED OR EXCHANGED ONLY TOGETHER
WITH, THE SHARES OF SERIES C PREFERRED STOCK ISSUED BY EARTHWATCH INCORPORATED
IN CONNECTION HEREWITH.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, 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, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS AN "INSTITUTIONAL ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),(3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT
WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE 144(k) AS IN EFFECT ON
THE DATE OF SUCH TRANSFER, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO
EARTHWATCH OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED
FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE ACCRETED
VALUE OF NOTES OF LESS THAN $250.000. AN OPINION OF COUNSEL ACCEPTABLE TO
EARTHWATCH THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THE TIME PERIOD
REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE TRUSTEE, IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL
ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE
TRUSTEE AND EARTHWATCH SUCH CERTIFICATIONS. LEGAL OPINIONS OR OTHER INFORMATION
AS EITHER MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER AND TRANSFER OF THIS NOTE
IN VIOLATION OF THE FOREGOING RESTRICTIONS.
THIS DEFINITIVE REGISTERED NOTE IS HELD BY THE TRUSTEE, AS CUSTODIAN FOR THE
DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE), IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON
UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THIS DEFINITIVE REGISTERED NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.07(a) OF THE INDENTURE
AND (11) THIS DEFINITIVE REGISTERED NOTE MAY BE TRANSFERRED TO A DEPOSITARY WITH
THE PRIOR WRITTEN CONSENT OF EARTHWATCH INCORPORATED.
B-2
EARTHWATCH INCORPORATED
13% Senior Discount Note Due 2007
CUSIP No. 000000XX0
No.___________
Issue Date Under Internal Revenue Code (the "Code"): July 12, 1999
EARTHWATCH INCORPORATED, a Delaware corporation (the "Company" which
term includes any successor under the Indenture hereinafter referred to), for
value received, promises to pay to _________, or its registered assigns, the
principal sum of _____________ United States Dollars ($______) on July 15, 2007.
The following information is supplied for purposes of Sections 1273
and 1275 of the Code:
Issue Date under the Code: July 12, 1999
Yield to maturity for period from 13%
Issue/Closing Date to July 15, 2007:
Original issue discount under Section 1273 of $487.22
the Internal Revenue Code (for each $1,000
principal amount at Maturity Date):
Issue Price (for each $ 1,000 principal $512.78
amount at Maturity Date):
Interest Payment Dates: January 15 and July 15,
commencing January 15, 2003.
Regular Record Dates: January 1 and July 1.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which provisions shall have the same effect as if
set forth hereon.
B-3
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
Date:
EARTHWATCH INCORPORATED
By:__________________________________
Name:
Title:
This is one of the 13% Senior Discount Notes due 2007 described in the within-
mentioned Indenture.
THE BANK OF NEW YORK, Trustee
By:__________________________________
Authorized Signatory
B-4
[REVERSE SIDE OF NOTE]
EARTHWATCH INCORPORATED
13% Senior Discount Note due 2007
1 Principal and Interest.
----------------------
EarthWatch Incorporated (the "Company") shall pay the principal of
-------
this Note on July 15, 2007.
The Company promises to pay interest on the principal amount of this
Note on each Interest Payment Date, as set forth below, at the rate per annum
shown above.
Interest on the Notes shall be payable at the rate of 13% per annum
(the "Interest Rate") and shall be payable in U.S. dollars semiannually on
January 15 and July 15 (each, an "Interest Payment Date") to be paid to the
person in whose name this Note is registered as of the close of business on the
Regular Record Date for such interest, which shall be January 1 or July 1
(whether or not a Business Day); provided that no interest shall be payable in
cash on the principal amount of the Notes prior to July 15, 2002, except as
provided in the next paragraph.
From and after July 15, 2002, interest on the Notes shall be payable
semiannually in cash on January 15 and July 15 of each year. Interest on the
Notes shall accrue from the most recent date to which interest has been paid or
duly provided for, or if no interest has been paid or duly provided for, from
July 12, 1999. Interest shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
If an exchange offer registered under the Securities Act of 1933 is
not consummated and a Shelf Registration Statement under the Securities Act with
respect to resales of the Notes is not declared effective by the Commission on
or before August 15, 2000 in accordance with the terms of the Notes Registration
Rights Agreement dated as of July 7, 1999, between the Company and Xxxxxx
Xxxxxxx & Co. Incorporated, interest (in addition to the accrual of original
discount during the period ending July 15, 2002 and in addition to the interest
otherwise due on the Notes after such date) shall accrue from August 15, 2000,
at an annual rate of .5 % of the Accreted Value of the Notes on the preceding
Semi-Annual Accrual Date, payable in cash semiannually, in arrears, on January
15 and July 15 of each year, commencing January 15, 2001, until (i) the exchange
offer is consummated, (ii) the Shelf Registration Statement is declared
effective or (iii) the date that the Notes become freely tradable without
registration under the Securities Act; provided that upon the request of any
Holder of the Notes, the Company shall, in accordance with the terms of the
Indenture, deliver to such Holder certificates evidencing such Holder's Notes
without the legends restricting the
B-5
transfer thereof. The Holder of this Note is entitled to the benefits of such
Notes Registration Rights Agreement.
The Company shall pay interest on overdue principal and premium, if
any, and (to the extent lawful) interest on overdue installments of interest at
the rate of 13)% per annum.
2. Method of Payment.
------------------
The Company shall pay principal as provided above and interest on each
Interest Payment Date to the persons who are Holders (as reflected in the
Register at the close of business on each January 1 and July 1 immediately
preceding the Interest Payment Date), in each case, even if the Note is canceled
on registration or transfer or exchange after such Regular Record Date; provided
that, with respect to payment of principal, the Company shall not make payment
to the Holder unless this Note is surrendered to the Paying Agent.
The Company shall pay principal, premium, if any, and as provided
above, interest in money of the United States of America that at the time of
payment is legal tender for payment of public and private debts. However, the
Company may pay principal, premium, if any, and interest by its check payable in
such money. The Company may mail an interest check to a Holder's registered
address (as reflected in the Register). If a payment date is a date other than a
business day at a place of payment, payment may be made at that place on the
next succeeding day that is a Business Day and no interest shall accrue for the
intervening period.
3. Paying Agent and Registrar.
--------------------------
Initially, the Trustee shall act as authenticating agent, Paying Agent
and Registrar. The Company may change any authenticating agent, Paying Agent and
Registrar without notice in accordance with the Indenture. The Company, any
Affiliate or any Subsidiary thereof may act as the Paying Agent or Registrar.
4. Indenture; Limitations.
----------------------
The Company issued the Notes under an Indenture dated as of July 12,
1999 (the "Indenture"), between the Company and The Bank of New York, trustee
---------
(the "Trustee"). Capitalized terms herein are used as defined in the Indenture
-------
unless otherwise indicated. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act. The Notes are subject to all such terms, and Holders are referred
to the Indenture and the Trust Indenture Act for a statement of all such terms.
To the extent permitted by applicable law, in the event of any inconsistency
between the terms of this Note and the terms of the Indenture, the terms of the
Indenture shall control.
5. Security.
--------
B-6
The Notes are secured by the First QuickBird Launch Insurance pursuant
to and as provided in the Security Documents.
6. Redemption.
-----------
The Notes may be redeemed at the election of the Company, in whole or
in part, on July 15, 2004 and from time to time thereafter prior to maturity,
upon not less than 30 nor more than 60 days' prior notice mailed by first-class
mail to each Holder's last address as it appears in the Register, in amounts
of $1,000 or an integral multiple of $1,000, at the Redemption Prices
(expressed as percentages of principal amount at maturity) set forth below, plus
accrued and unpaid interest to the Redemption Date, if redeemed during the 12-
month period beginning on July 15 of the years indicated below:
Year Redemption Price
---- ----------------
2004 ................... 106.500%
2005 ................... 104.333%
2006 ................... 102.167%
2007 ................... 100.000%
7. Notice of Redemption.
--------------------
Notice of any optional redemption shall be mailed at least 30 days
but not more than 60 days' before the Redemption Date to each Holder of Notes to
be redeemed at its last address as it appears in the Register. Notes in original
denominations larger than $1,000 may be redeemed in part. On and after the
Redemption Date, interest ceases to accrue on Notes or portions of Notes called
for redemption, unless the Company defaults in the payment of the Redemption
Price.
8. Repurchase upon Change of Control.
---------------------------------
Upon the occurrence of any Change of Control, the Company shall be
obligated to make an offer to purchase all outstanding Notes pursuant to the
Offer to Purchase described in the Indenture at a purchase price equal to 101%
of the Accreted Value thereof at the relevant Payment Date, plus, without
duplication, accrued and unpaid interest, if any, to the Payment Date (the
"Change of Control Payment").
-------------------------
A notice of such Change of Control shall be mailed within 30 days
after any Change of Control occurs to each Holder of Notes at such Holder's
registered address as it appears in the Register. Notes in original
denominations larger than $1,000 may be sold to the Company in part; provided
that Notes shall only be issued in denominations of $1,000 principal
B-7
amount at maturity or integral multiples thereof. On and after the Payment Date,
interest ceases to accrue on Notes or portions of Notes surrendered for purchase
by the Company, unless the Company defaults in the payment of the Change of
Control Payment.
9. Repurchase of Notes upon an Insurance Proceeds Payment.
------------------------------------------------------
The Company must commence, within 30 days of receipt by the Collateral
Trustee of any proceeds under the First QuickBird Launch Insurance, and must
thereafter consummate an Offer to Purchase the Notes then outstanding, and an
offer to purchase the 12 1/2% Notes then outstanding, on a pro rata basis in an
aggregate amount equal to the Insurance Proceeds Payment Amount not previously
subject to an Offer to Purchase under Section 4.18 of the Indenture at a
purchase price for the Notes and the 12 1/2% Notes equal to 100% of the accreted
value thereof on the relevant payment date, plus accrued and unpaid interest, if
any, to such payment date. If the aggregate purchase price of the Notes and the
12 1/2% Notes tendered in connection with such offers to purchase is less than
the Insurance Proceeds Payment Amount, the remaining Insurance Proceeds Payment
Amount shall be paid over to the Company and may be used for general corporate
purposes.
10. Denomination; Transfer; Exchange.
--------------------------------
The Notes are in registered form without coupons in denominations of
$1,000 of principal amount at maturity or an integral multiple thereof. A Holder
may register the transfer or exchange of Notes in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
or exchange of any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before the mailing of
a notice of redemption of Notes to be redeemed is made. This Note is a Global
Note.
11. Persons Deemed Owners.
----------------------
The Holder of this Note shall be treated as the owner of this Note for
all purposes.
12. Unclaimed Money.
----------------
If money for the payment of principal, premium, if any, and interest
remains unclaimed for two years, the Trustee and the Paying Agent shall pay the
money back to the Company at its written request. After that, Holders entitled
to the money must look to the Company for payment, unless an applicable law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
B-8
13. Discharge Prior to Redemption or Maturity.
-----------------------------------------
If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Notes (a) to redemption or maturity, the
Company shall be discharged from the Indenture and the notes, except in certain
circumstances for certain sections thereof, and (b) to redemption to the Stated
Maturity, the Company shall be discharged from certain covenants set forth in
the Indenture.
14. Amendment, Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in aggregate principal amount at maturity of the Notes then outstanding, and any
existing default or compliance with any provision may be waived with the consent
of the Holders of at least a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or the consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency and make any change that
does not materially and adversely affect the rights of any Holder.
15. Restrictive Covenants.
---------------------
The Indenture imposes certain limitations on the ability of the
Company and the Restricted Subsidiaries, among other things, incur additional
Indebtedness, to create Liens; make certain Restricted Payments; or enter into
certain Sale-Leaseback transactions. Within 90 days after the end of the last
fiscal quarter of each year, the Company must report to the Trustee on
compliance with such limitations. Notwithstanding any other provision of the
Indenture or the Notes, neither the amendments to the Amended and Restated
Indenture dated as of April 8, 1999, relating to the 12 1/2% Notes, nor the
Collateral Pledge and Security Agreement dated as of April 8, 1999, as amended,
is prohibited or restricted by any term, covenant, condition or provision of the
Indenture, the Notes, the 12 1/2% Notes or the Security Documents, shall
constitute a Default or Event of Default or shall require the prepayment of the
Notes.
16. Successor Persons.
------------------
Generally, when a successor person or other entity assumes all the
obligations of its predecessor under the Notes and the Indenture, the
predecessor person shall be released from those obligations.
17. Defaults and Remedies.
----------------------
B-9
The following events shall be defined as "Events of Default" in the
-----------------
Indenture: (a) default in the payment of principal of (or premium, if any, on)
any Note when the same becomes due and payable at maturity, upon acceleration,
redemption or otherwise, (b) default in the payment of interest on any Note when
the same becomes due and payable, and such default continues for a period of 30
days; (c) failure to make or consummate an Offer to Purchase in accordance with
Sections 4.7, 4.11 and 4.18 of the Indenture; (d) the Company defaults in the
performance of or breaches any other covenant or agreement of the Company in the
Indenture or under the Notes (other than a default specified in clause (a), (b)
or (c) above) and such default or breach continues for a period of 30
consecutive days after written notice by the Trustee or the Holders of 25% or
more in aggregate principal amount at maturity of the Notes; (e) there occurs
with respect to any issue or issues of Indebtedness of the Company or any
Significant Subsidiary having an outstanding principal amount of $1,000,000 or
more in the aggregate for all such issues of all such Persons, whether such
Indebtedness now exists or shall hereafter be created, (I) an event of default
that has caused the holder thereof to declare such Indebtedness to be due and
payable prior to its Stated Maturity and such Indebtedness has not been
discharged in full or such acceleration has not been rescinded or annulled
within 30 days of such acceleration and/or (II) the failure to make a principal
payment at the final (but not any interim) fixed maturity and such defaulted
payment shall not have been made, waived or extended within 30 days of such
payment default-and/or (III) with respect to Indebtedness represented by the
12 1/2% Notes, there shall occur any default in the performance or observance of
any term, condition, covenant or agreement contained therein or in any agreement
relating thereto, or any other event specified in any such Indebtedness or
agreement, if the effect thereof is to cause, or permit the holder or holders of
such Indebtedness (or any trustee or other representative of any such holder(s))
to cause, such Indebtedness to become due prior to its stated maturity; (f) any
final judgment or order (not covered by insurance) for the payment of money in
excess of $1,000,000 in the aggregate for all such final judgments or orders
against all such Persons (treating any deductibles, self-insurance or retention
as not so covered) shall be rendered against the Company or any Significant
Subsidiary and shall not be paid or discharged, and there shall be any period of
30 consecutive days following entry of the final judgment or order that causes
the aggregate amount for all such final judgments or orders outstanding and not
paid or discharged against all such Persons to exceed $1,000,000 during which a
stay of enforcement of such final judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; (g) a court having jurisdiction in
the premises enters a decree or order for (A) relief in respect of the Company
or any Significant Subsidiary in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, (B)
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any Significant Subsidiary or
(for all or substantially all of the property and assets of the Company or any
Significant Subsidiary or (C) the winding up or liquidation of the affairs of
the Company or any Significant Subsidiary and, in each case, such decree or
order shall remain unstayed and in effect for a period of 60 consecutive days;
(h) the Company or any Significant Subsidiary (A) commences a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consents to the entry of an order for relief in an
involuntary case under any such law,
B-10
(B) consents to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
the Company or any Significant Subsidiary or for all or substantially all of the
property and assets of the Company or any Significant Subsidiary or (C) effects
any general assignment for the benefit of creditors or (i) with respect to the
First QuickBird Satellite, there shall occur the loss the of 15% or more of such
satellite's capacity or any other event that permits or requires the payment of
any proceeds of the First QuickBird Launch Insurance by the insurance company
thereunder and, in either such case, such proceeds are not paid over to the
Collateral Trustee within 90 days of the demand being made under the applicable
QuickBird Launch Insurance policy.
If an Event of Default (other than an Event of Default specified in
clause (g) or (h) above that occurs with respect to the Company) occurs and is
continuing under the Indenture, the Trustee or the Holders of at least 25% in
aggregate principal amount at maturity outstanding, by written notice to the
Company (and to the Trustee if such notice is given by the Holders), may, and
the Trustee at the request of such Holders shall, declare the principal amount
of, premium, if any, and accrued interest on the Notes to be immediately due and
payable. Upon a declaration of acceleration, such principal amount of, premium,
if any, and accrued interest shall be immediately due and payable. In the event
of a declaration of acceleration because an Event of Default set forth in clause
(e) above has occurred and is continuing, such declaration of acceleration shall
be automatically rescinded and annulled if the event of default triggering such
Event of Default pursuant to clause (e) shall be remedied or cured by the
Company or the relevant Significant Subsidiary or waived by the holders of the
relevant Indebtedness within 60 days after the declaration of acceleration with
respect thereto. If an Event of Default specified in clause (g) or (h) above
occurs with respect to the Company, the principal amount of, premium, if any,
and accrued interest on the Notes then outstanding shall ipso facto become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Holder. The Holders of at least a majority in principal
amount at maturity of the outstanding Notes by written notice to the Company and
to the Trustee, may waive all past defaults and rescind and annul a declaration
of acceleration and its consequences if (i) all existing Events of Default,
other than the nonpayment of the principal of, premium, if any, and interest on
the Notes that have become due solely by such declaration of acceleration, have
been cured or waived and (ii) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction.
The Holders of at least a majority in aggregate principal amount at
maturity of the outstanding Notes may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that conflicts with law or the Indenture, that may involve
the Trustee in personal liability, or that the Trustee determines in good faith
may be unduly prejudicial to the rights of Holders of Notes not joining in the
giving of such direction and may take any other action it deems proper that is
not inconsistent with any such direction received from Holders of Notes. A
Holder may not pursue any remedy with respect to
B-11
the Indenture or the Notes unless: (i) the Holder gives the Trustee written
notice of a continuing Event of Default; (ii) the Holders of at least 25% in
aggregate principal amount at maturity of outstanding Notes make a written
request to the Trustee to pursue the remedy; (iii) such Holder or Holders offer
the Trustee indemnity satisfactory to the Trustee against any costs, liability
or expense; (iv) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and (v) during such 60-
day period, the Holders of a majority in aggregate principal amount at maturity
of the outstanding Notes do not give the Trustee a direction that is
inconsistent with the request. However, such limitations do not apply to the
right of any Holder of a Note to receive payment of the principal of, premium,
if any, or interest on, such Note or to bring suit for the enforcement of any
such payment, on or after the due date expressed in the Notes, which right shall
not be impaired or affected without the consent of the Holder.
18. Trustee Dealings with Company.
-----------------------------
The Trustee under the Indenture, in its individual or any other
capacity, may become owner or pledgee of Notes and may otherwise deal with the
Company or its Affiliates with the same rights it would have if it were not the
Trustee.
19. No Recourse Against Others.
--------------------------
No recourse for the payment of the principal of, premium, if any, or
interest on any of the Notes or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture, or in any of the Notes or because of
the creation of any Indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer, director, employee or controlling person of
the Company or of any successor Person thereof. Each Holder, by accepting the
Notes, waives and releases all such liability.
20. Authentication.
--------------
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
21. CUSIP Numbers.
-------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Notes and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.
B-12
This Note shall be governed by and construed in accordance with the
internal laws of the State of New York.
The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to EarthWatch
Incorporated, 0000 Xxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: President.
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.7 or 4.12 of the Indenture, check the box: [_]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.7 of the Indenture, state the amount (in principal amount
at maturity): $___________________ ($1,000 or integral multiple thereof).
Date:________________
Your Signature:_________________________________________________________________
Signature Guarantee:________________
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.12 of the Indenture, state the amount (in principal amount
at maturity): $____________________ ($1,000 or integral multiple thereof).
Date:________________
Your Signature:_________________________________________________________________
Signature Guarantee:/2/ __________________
______________________
/2/ The Holder's signature must be guaranteed by a member firm of a registered
national securities exchange or of the National Association of Securities
Dealers, Inc., a commercial bank or trust company having an office or
correspondent in the United States or an "eligible guarantor institution"
as defined by Rule 17Ad-15 under the Exchange Act.
EXHIBIT C
FORM OF CERTIFICATE OF TRANSFER
EarthWatch Incorporated
0000 Xxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: President
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
[CHECK ONE IF TRANSFEROR IS AN INSTITUTIONAL ACCREDITED INVESTOR (AND
NOT A QIB)]
The Transferor hereof hereby certifies that this Transfer is being made through
the Placement Agent through which the Holder acquired the Notes or Book-Entry
Interests so transferred. The Placement Agent through which this Transfer is
being made, and that is receiving this certificate, is:
[_] Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: 13% Senior Discount Notes due 2007 of EarthWatch Incorporated
Reference is hereby made to the Indenture dated as of July 12, 1999
(the "Indenture"), between EarthWatch Incorporated (the "Company") and The Bank
---------- -------
of New York, trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
______________ (the "Transferor") owns and proposes to transfer the
----------
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount at maturity of in such Note[s] or interests (the "Transfer"),
--------
to ______________ (the "Transferee"), as further specified in Annex A hereto. In
----------
connection with the Transfer, the Transferor hereby certifies that:
C-2
[CHECK ALL THAT APPLY]
1. [_] Check if Transferee will take delivery of Book-Entry Interests in the
---------------------------------------------------------------------
144A Global Note or Definitive Registered Notes pursuant to Rule 144A. The
---------------------------------------------------------------------
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
--------------
and, accordingly, the Transferor hereby further certifies that the Book-Entry
Interests or Definitive Registered Notes are being transferred to a Person that
the Transferor reasonably believes is purchasing the Book-Entry Interests or
Definitive Registered Notes for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Any such Transfer of a Book-Entry Interest in
the Regulation S Global Note for Definitive Registered Notes shall only occur on
a date in compliance with Regulation S. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture the transferred Book-
Entry Interest or Definitive Registered Note will be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the 144A
Global Note and/or the Definitive Registered Note and in the Indenture and the
Securities Act.
2. [_] Check and complete if Transferee will take delivery of Book-Entry
-----------------------------------------------------------------
Interests in Definitive Registered Notes pursuant to any provision of the
-------------------------------------------------------------------------
Securities Act other than Rule 144A. The Transfer is being effected in
-----------------------------------
compliance with the transfer restrictions applicable to Book-Entry Interests in
Registered Global Notes and Definitive Registered Notes bearing the Private
Placement Legend and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any State of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) [_] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [_] such Transfer is being effected to the Company or a
subsidiary thereof,
or
(c) [_] such Transfer is being effected pursuant to an effective
registration statement or under the Securities Act;
C-3
or
(d) [_] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that the Transfer complies with the
transfer restrictions applicable to Definitive Registered Notes bearing the
Private Placement Legend and the requirements of the exemption claimed, which
certification is supported by (x) if such Transfer is in respect of a principal
amount at maturity of Notes at the time of Transfer of $250,000 or more, a
certificate executed by the Transferee in the form of Exhibit E to the
Indenture, or (y) if such Transfer is in respect of a principal amount at
maturity of Notes at the time of transfer of less than $250,000, (1) a
certificate executed by the Transferee in the form of Exhibit E to the Indenture
and (2) an Opinion of Counsel provided by the Transferor or the Transferee (a
copy of which the Transferor has attached to this certification), to the effect
that (1) such Transfer is in compliance with the Securities Act and (2) such
Transfer complies with any applicable blue sky securities laws of any state of
the United States. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred Definitive Registered Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Definitive Registered Notes and in the Indenture and the
Securities Act.
3. [_] Check if Transferee will take delivery of Book-Entry Interests in the
---------------------------------------------------------------------
Definitive Registered Notes that do not bear the Private Placement Legend.
-------------------------------------------------------------------------
(a) [_] Check if Transfer is pursuant to Rule 144. (i) The Transfer
-----------------------------------------
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States, and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred Book-Entry Interests or
Definitive Registered Notes will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Definitive Registered Notes bearing the Private Placement
Legend and in the Indenture.
(b) [_] Check if Transfer is pursuant to other Exemption. (i) The
------------------------------------------------
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144 and in
compliance with the transfer restrictions contained in the Indenture and any
applicable blue sky securities laws of any State of the United States and (ii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act.
C-4
Upon consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred Book-Entry Interests or Definitive Registered Notes
will not be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Definitive Registered
Notes bearing the Private Placement Legend and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
_________________________________________
[Insert Name of Transferor]
By:______________________________________
Name:
Title:
Dated: ___________
FORM OF ANNEX A TO CERTIFICATE
OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] Book-Entry, Interests in the:
(i) [_] 144A Global Note (CUSIP ), or
(b) [_] Definitive Registered Note.
2. that the Transferee will hold:
[CHECK ONE]
(a) [_] Book-Entry Interests in the:
(i) [_] 144A Global Note (CUSIP ), or
(b) [_] Restrictive Definitive Registered Notes,
(c) [_] Definitive Registered Note that does not bear the Private
Placement Legend;
in accordance with the terms of the Indenture.
EXHIBIT D
FORM OF CERTIFICATE OF EXCHANGE
EarthWatch Incorporated
0000 Xxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: President
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
[CHECK ONE IF HOLDER IS AN INSTITUTIONAL ACCREDITED INVESTOR (AND NOT A QIB)]
The Holder acquired the Notes or Book-Entry Interests
and is receiving this certificate through
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: 13% Senior Discount Notes due 2007 of EarthWatch
Incorporated
(CUSIP, )
Reference is hereby made to the Indenture, dated as of July 12, 1999
(the "Indenture"), between EarthWatch Incorporated (the "Company") and The Bank
--------- -------
of New York, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
____________________ (the "Holder"), owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount at
maturity of $ ________ in such Note[s] or interests (the "Exchange"). In
--------
connection with the Exchange, the Holder hereby certifies that:
Exchange of Restricted Definitive Registered Notes for Definitive Registered
Notes that do not bear the Private Placement Legend
[_] Check if Exchange is from Restricted Definitive Registered Notes
----------------------------------------------------------------
to Definitive Registered Notes that do not bear the Private Placement Legend. In
----------------------------------------------------------------------------
connection with the Holder's Exchange of a Restricted Definitive Registered Note
for Definitive Registered Notes that do not bear the Private Placement Legend,
the Holder hereby certifies (1) the Definitive Registered Notes that do not bear
the Private Placement Legend are being acquired for the Holder's own account
without transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Registered Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Notes are being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
_________________________________
[Insert Name of Holder]
By:______________________________
Name:
Title:
Dated:________________
D-2
EXHIBIT E
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
EarthWatch Incorporated
0000 Xxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
XXXXXX XXXXXXX & CO. INCORPORATED
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with our proposed purchase of 13% Senior Discount Notes
due 2007 (collectively, the "Notes"), of EarthWatch Incorporated (the
"Company"), we confirm that:
-------
1. We understand that, any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture (the "Indenture"), dated as of July 12, 1999 relating to the Notes
----------
and the undersigned agrees to be bound by, and not to resell, pledge or
otherwise transfer the Notes or any interest therein except in compliance with,
such restrictions and conditions and the Securities Act of 1933, as amended (the
"Securities Act").
---------------
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
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 permitted
in the following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we should sell
the Notes or any interest therein, we will do so only (A) to the Company or any
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to the Trustee under
the Indenture (the "Trustee"), (i) a signed letter containing certain
-------
representations and agreements relating to the restrictions or transfer of the
Notes (the form of which letter can be obtained from the Trustee) and (ii), if
such transfer is in respect of a principal amount at maturity of Notes at the
time of transfer of less than $250,000, an Opinion of Counsel acceptable to the
Issuer that such transfer is in compliance with the Securities Act, (D) outside
the United States in accordance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the exemption from registration provided by Rule
144 under the Securities Act or (F) pursuant to an effective registration
statement under the Securities Act, and, in each case, in accordance with
applicable state securities laws and securities laws of any other applicable
Jurisdictions, and we further agree to provide to any person purchasing any of
the Notes from us a notice advising such purchaser that resales of the Notes are
restricted as stated herein. We understand that if we are an Institutional
Accredited Investor and not a QIB we will need to effect any, transfer of
Securities (other than pursuant to an effective registration statement) through
the Placement Agent (as defined in the Offering Memorandum).
3. We understand that, on any proposed resale of the Notes, we will
be required to furnish to the Company such certifications, legal opinions and
other information as the Company and the Trustee may reasonably require
to confirm that the proposed sale complies with the foregoing restrictions. We
further understand that the Notes purchased by us will bear a legend to the
foregoing effect.
4. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes purchased by us for our own account
or for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
You, the Company and the Trustee are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby.
Very truly yours.
[Insert Name of Accredited Transferor]
By:________________________________________
Name:
Title:
Dated:_______________
E-2
