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NEXTWAVE TELECOM INC.,
as Issuer,
THE GUARANTORS,
party hereto from time to time,
[NAME,
as Collateral Agent]
and
[NAME],
as Trustee
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INDENTURE
Dated as of _______ ___, 1999
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12% SENIOR SECURED SUBORDINATED NOTES DUE 2009
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INDENTURE dated as of _______ ___, 1999, between NextWave Telecom Inc., a
Delaware corporation (referred to herein as the "Company"), NextWave Personal
Communications Inc., a Delaware corporation ("NPCI"), NextWave Power Partners
Inc., a Delaware corporation ("NPPI") (NPPI and NPCI collectively referred to
herein as the "Guarantors") and ____________________, as trustee (the "Trustee")
[and ____________, as the collateral agent (the "Collateral Agent")].
GRANTING CLAUSE
THIS INDENTURE WITNESSETH, that, to secure the payment of the principal,
premium, if any, and interest on all the Notes (as hereinafter defined) from
time to time outstanding hereunder and the performance and observance of the
agreements, covenants and provisions contained herein, and in the other Security
Documents, and in consideration of the premises and of the issuance of the Notes
to the Holders (as hereinafter defined), the Company and the License Holding
Subsidiaries hereby irrevocably grant, assign, pledge, hypothecate, and create
in favor of the Collateral Agent, its successors and assigns, in the trust
created by the Security Documents for the ratable security and benefit of the
Holders of the Notes, a continuing security interest in and Lien on the
following described property, rights and privileges, whether now owned or
existing or hereafter acquired or arising and regardless of where located
(including, without limitation, all property, rights and privileges hereafter
subjected to the Lien of this Indenture); provided, however, that any such Liens
or security interests existing on, in or under the Collateral shall be subject
to the terms and the conditions of the Security Documents.
(a) The License Holding Subsidiary Shares of each License Holding
Subsidiary and the certificates representing such License Holding Subsidiary
Shares, and all dividends, distributions, cash, instruments and other property
or proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the License Holding Subsidiary
Shares of each such License Holding Subsidiary;
(b) subject to the exceptions set forth in this Indenture, all additional
shares of Capital Stock of any License Holding Subsidiary from time to time
acquired by the Company in any manner (which shares shall be deemed to be part
of the License Holding Subsidiary Shares), and the certificates representing
such additional shares, and all dividends, distributions, cash, instruments and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any and all such shares;
(c) all shares of any Person who, after the date of this Indenture,
becomes, as a result of any occurrence, a License Holding Subsidiary (which
shares shall be deemed to be part of the License Holding Subsidiary Shares) and
the certificates representing such shares, and all dividends, cash, instruments
and other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all such shares;
(d) all right, title and interest of the Company in, to and under the funds
on deposit, and the Permitted Investment Accounts held from time to time by the
Collateral Agent, in the Cash Collateral Account, including the rights of
enforcement with respect to the Permitted Investment Accounts, together with any
certificates or other instruments representing or evidencing such Permitted
Investment Accounts and all other rights, property and money at any
time and from time to time received, receivable or otherwise distributed on or
in respect of or in exchange for any or all of such Permitted Investment
Accounts;
(e) all Instruments hereafter acquired by the Company as part of the Net
Proceeds from any Permitted License Holding Subsidiary Transaction, including
rights of enforcement with respect to the Instruments, together with any
certificates or other instruments representing or evidencing such Instruments
and all other rights, property and money at any time and from time to time
received, receivable or exchange for any or all of such Instruments;
(f) all property hereafter delivered to or acquired by, or on behalf of,
the Collateral Agent in substitution for or in addition to any of the foregoing,
and all other rights whatsoever of the Company in and to the same and every part
thereof with respect to all such property and all other property from time to
time subjected or required to be subjected to this Indenture; and
(g) all Proceeds of the foregoing (all of the foregoing being referred to
herein as the "Collateral").
TO HAVE AND TO HOLD the Collateral unto the Collateral Agent, its
successors and assigns;
BUT IN TRUST, NEVERTHELESS, for the equal and ratable benefit and security
of the Holders from time to time of all the Notes, without priority of one
Holder over any other, and for the uses and purposes, and subject to the terms
and provisions, of this Indenture and the other Security Documents;
AND IT IS HEREBY COVENANTED, DECLARED AND AGREED that all the Notes are to
be issued and delivered, and that all property subject or to become subject
hereto is to be held, subject to further covenants, conditions, uses and trusts
hereinafter set forth, and the Company hereby binds itself and its successors
and assigns to warrant and forever defend to the Collateral Agent and its
successors and assigns all the properties included in the Collateral, and the
Company hereby further warrants and agrees to and with the Trustee for the equal
and proportionate benefit and security of those who shall hold the Notes, as
hereinafter set forth.
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 DEFINITIONS.
"Accounts Receivable Subsidiary" means an Unrestricted Subsidiary of the
Company to which the Company or any of its Restricted Subsidiaries sells any of
its accounts receivable pursuant to a Receivables Facility.
"Acquired Indebtedness" means, with respect to any specified Person, (a)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (b) Indebtedness secured by a Lien
encumbering an
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asset acquired by such specified Person at the time such asset is acquired by
such specified Person.
"Affiliate" of any specified Person means any other Person which, directly
or indirectly, controls, is controlled by or is under direct or indirect common
control with, such specified Person. For purposes of this definition, "control,"
when used with respect to any Person, means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depositary that apply to such transfer or exchange.
"Asset Sale" means the sale, conveyance, disposition or other transfer (a
"disposition") of any properties, assets or rights (provided that the sale,
conveyance or other disposition of all or substantially all of the assets of the
Company and its Subsidiaries taken as a whole, whether by sale, merger,
consolidation or otherwise, will be governed by the Section 5.01 and not by the
provisions of Section 4.07). Notwithstanding the foregoing, the following items
shall not be deemed to be Asset Sales: (a) dispositions in the ordinary course
of business; (b) a disposition of assets by the Company to a Restricted
Subsidiary or by a Restricted Subsidiary to the Company or to another Restricted
Subsidiary; (c) the sale and leaseback of any assets within 90 days of the
acquisition thereof; (d) foreclosures on assets; (e) any exchange of property
for use in a Permitted Business including, without limitation, pursuant to
Section 1031 of the Internal Revenue Code of 1986, as amended; (f) any lease or
lease transaction, including, without limitation, a financing lease or a
sale-leaseback transaction; (g) any Indebtedness or other securities of, an
Unrestricted Subsidiary; (h) a Permitted Investment or a Restricted Payment that
is permitted by Section 4.06 hereof; and (i) sales of accounts receivable, or
participations therein, in connection with any Receivables Facility.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company, or any
authorized committee of the Board of Directors.
"Business Day" means any day other than a Legal Holiday.
"Capital Expenditure Indebtedness" means Indebtedness incurred by any
Person to finance the purchase or construction of any property or assets
acquired or constructed by such Person which have a useful life of more than one
year so long as (a) the purchase or construction price for such property or
assets is included in "addition to property, plant or equipment" in accordance
with GAAP, (b) the acquisition or construction of such property or assets is not
part of any acquisition of a Person or line of business and (c) such
Indebtedness is incurred within 90 days of the acquisition or completion of
construction of such property or assets, and includes, without limitation, any
and all Indebtedness incurred pursuant to any Vendor Financing Facility.
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"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet in accordance with
GAAP.
"Capital Stock" means (a) in the case of a corporation, corporate stock,
(b) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
corporate stock, (c) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited) and (d) any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.
"Cash Equivalents" means (i) Government Securities, (ii) any certificate of
deposit maturing not more than 365 days after the date of acquisition issued by,
or demand deposit or time deposit of, an Eligible Institution, (iii) commercial
paper maturing not more than 365 days after the date of acquisition of an issuer
(other than an Affiliate of the Company) with a rating, at the time as of which
any investment therein is made, of "A-1" (or higher) according to S&P or "P-1"
(or higher) according to Moody's or carrying an equivalent rating by a
nationally recognized rating agency if both of the two named rating agencies
cease publishing ratings of investments, (iv) any bankers acceptances or money
market deposit accounts issued by an Eligible Institution, (v) any fund
investing substantially in investments of the types described in clauses (i)
through (iv) above and (vi) in the case of any Subsidiary organized or having
its principal place of business outside the United States, investments
denominated in the currency of the jurisdiction in which such Subsidiary is
organized or has its principal place of business which are similar to the items
specified in clauses (i) through (v) above (including, without limitation, any
deposit with a bank that is a lender to any Restricted Subsidiary).
"cash equivalents" means, for purposes of Article 10 of this Indenture,
Cash Equivalents of the type described in clause (i) of the definition thereof
maturing not more than 90 days after the date of the acquisition thereof.
"Change of Control" means the occurrence of any of the following: (a) the
sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Subsidiaries, taken as a
whole, to any "person" or "group" (as such terms are used in Section 13(d) of
the Exchange Act), other than the Principals and their Related Parties or (b)
the consummation of any transaction (including, without limitation, any merger
or consolidation) the result of which is that any "person" or "group" (as such
terms are used in Section 13(d) of the Exchange Act), other than the Principals
and their Related Parties, becomes the "beneficial owner" (as such term is
defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or
indirectly through one or more intermediaries, of 50% or more of the voting
power of the outstanding voting equity interests of the Company.
"Collateral Agency Agreement" means the Collateral Agency Agreement of even
date herewith among ___________________, substantially in the form attached
hereto as Exhibit ___, as the same may be amended or supplemented from time to
time in accordance with its terms.
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"Collateral Agent" means ___________ or such other institution or
institutions acting as collateral agent(s) under the Collateral Agency Agreement
as the Trustee may from time to time advise the Company in writing.
"Commission" means the Securities and Exchange Commission.
"Company" means NextWave Telecom Inc., a Delaware corporation, until a
successor corporation shall have become such pursuant to Section 5.02 and
thereafter "Company" shall mean such successor corporation.
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations, rights in or other equivalents (however designated,
whether voting or non-voting) of such Person's common stock, whether now
outstanding or issued after the date of this Indenture, including, without
limitation, all series and classes of such common stock.
"Consolidated EBITDA" means, with respect to any Person, for any period,
the sum (without duplication) of (i) Consolidated Net Income and (ii) to the
extent Consolidated Net Income has been reduced thereby, (a) all income taxes of
such Person and its Restricted Subsidiaries paid or accrued in accordance with
GAAP for such period (other than income taxes attributable to extraordinary or
nonrecurring gains or losses), (b) Consolidated Interest Expense and (c)
Consolidated Non-Cash Charges, all as determined on a consolidated basis for
such Person and its Restricted Subsidiaries in conformity with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for any
period, without duplication, the sum of (i) the interest expense of such Person
and its Restricted Subsidiaries for such period as determined on a consolidated
basis in accordance with GAAP, including, without limitation, (a) any
amortization of debt discount, (b) the net cost under Hedging Obligations
(including any amortization of discounts), (c) the interest portion of any
deferred payment obligation, (d) all commissions, discounts and other fees and
charges owed with respect to letters of credit, bankers' acceptance financing or
similar facilities, and (e) all accrued interest and (ii) the interest component
of Capital Lease Obligations paid or accrued by such Person and its Restricted
Subsidiaries during such period as determined on a consolidated basis in
accordance with GAAP; provided that Consolidated Interest Expense shall not
include accrued interest that is evidenced by Secondary Notes, "payment in kind"
securities or similar instruments in respect of such accrued interest.
"Consolidated Net Income" of any Person means, for any period, the
aggregate net income (or loss) of such Person and its Restricted Subsidiaries
for such period on a consolidated basis, determined in accordance with GAAP;
provided that there shall be excluded therefrom, without duplication, (a) gains
and losses from Asset Sales (without regard to the $___________ limitation set
forth in the definition thereof) or abandonments or reserves relating thereto
and the related tax effects, (b) items classified as extraordinary or
nonrecurring gains and losses, and the related tax effects according to GAAP,
(c) the net income (or loss) of any Person acquired in a pooling of interests
transaction accrued prior to the date it becomes a Restricted Subsidiary of such
first referred to Person or is merged or consolidated with it or any of its
Restricted Subsidiaries, (d) the net income of any Restricted Subsidiary to the
extent that the declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is restricted by contract, operation of law
or otherwise and (e) the net income of any Person, other than a
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Restricted Subsidiary, except to the extent of the lesser of (x) dividends or
distributions paid to such first referred to Person or its Restricted Subsidiary
by such Person and (y) the net income of such Person (but in no event less than
zero), and the net loss of such Person shall be included only to the extent of
the aggregate Investment of the first referred to Person or a consolidated
Restricted Subsidiary of such person. Notwithstanding the foregoing,
Consolidated Net Income shall not be reduced by accrued interest expense
evidenced by Secondary Notes, "payment in kind" securities or similar
instruments in respect of accrued interests.
"Consolidated Non-Cash Charges" means, with respect to any Person or any
period, the aggregate depreciation, amortization and other non-cash expenses of
such Person and its Restricted Subsidiaries reducing Consolidated Net Income of
such Person and its Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP (excluding any such charges
constituting an extraordinary or nonrecurring item). "Corporate Trust Office of
the Trustee" shall be at the address of the Trustee specified in Section 13.02
hereof or such other address as to which the Trustee may give notice to the
Company.
"Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
"Definitive Note" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, in the form of
Exhibit A hereto except that such Note shall not bear the Global Note Legend and
shall not have the "Schedule of Exchanges of Interests in the Global Note"
attached thereto.
"Depositary" means DTC or any successor thereto.
"Designated Noncash Consideration" means the fair market value of non-cash
consideration received by the Company or one of its Restricted Subsidiaries in
connection with an Asset Sale that is so designated as Designated Noncash
Consideration pursuant to an Officers' Certificate, setting forth the basis of
such valuation, executed by the principal executive officer and the principal
financial officer of the Company, less the amount of cash or Cash Equivalents
received in connection with a sale of such Designated Noncash Consideration.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable), or upon the happening of any event (other than any event solely
within the control of the issuer thereof), matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, is exchangeable for
Indebtedness (except to the extent exchangeable at the option of such Person
subject to the terms of any debt instrument to which such Person is a party) or
redeemable at the option of the Holder thereof, in whole or in part, on or prior
to the date on which the Notes mature; provided that any Capital Stock that
would constitute Disqualified Stock solely because the holders thereof have the
right to require the Company to repurchase such Capital Stock upon the
occurrence of an Asset Sale shall not constitute Disqualified Stock if the terms
of such Capital Stock provide that the
6
Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.06
hereof; provided further that, if such Capital Stock is issued to any plan for
the benefit of employees of the Company or its Subsidiaries or by any such plan
to such employees, such Capital Stock shall not constitute Disqualified Stock
solely because it may be required to be repurchased by the Company in order to
satisfy applicable statutory or regulatory obligations; and provided further
that in no event shall any of (i) the Series A Convertible Preferred Stock, par
value $0.01 per share, or (ii) the Senior Redeemable Preferred Stock, par value
$0.01 per share, of the Company constitute Disqualified Stock.
"Distribution", for purposes of Article 10 of this Indenture, may consist
of a distribution, payment or other transfer of assets by or on behalf of the
Company (including, without limitation, a redemption, repurchase or other
acquisition of the Notes) from any source, of any kind or character, whether in
cash, securities or other property, by set-off or otherwise.
"Eligible Institution" means a commercial banking institution that has
combined capital and surplus not less than $100.0 million or its equivalent in
foreign currency, whose short-term debt is rated "A-3" or higher according to
Standard & Poor's Ratings Group ("S&P") or "P-2" or higher according to Xxxxx'x
Investor Services, Inc. ("Moody's") or carrying an equivalent rating by a
nationally recognized rating agency if both of the two named rating agencies
cease publishing ratings of investments.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence on the Original Issuance Date, until such
amounts are repaid.
"Fair Market Value" means, with respect to any asset or property, the price
which could be negotiated in an arm's-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction. Unless the TIA
otherwise requires, Fair Market Value shall be determined by the Board of
Directors of the Company acting in good faith and shall be evidenced by a
resolution of the Board of Directors of the Company delivered to the Trustee.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the Original Issuance Date.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit or
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
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"Global Notes" means one or more permanent global Notes in substantially
the form of Exhibit A hereto bearing the Global Note Legend and having the
"Schedule of Exchanges of Interests in the Global Note" attached thereto and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee, issued in accordance with Section 2.01(b) or 2.06(d)(ii), as
applicable.
"Global Note Legend" means the legend set forth in Section 2.06(f), which
is required to be placed on all Global Notes issued under this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Hedging Obligations" means, with respect to any Person, the obligations of
such Person under (a) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements and (b) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates.
"Holder" means a Person in whose name a Note is registered.
"incur" means to, directly or indirectly, create, incur, issue, assume,
Guarantee or otherwise become directly or in indirectly liable, contingently or
otherwise with respect to any Indebtedness.
"Indebtedness" means, with respect to any Person, any indebtedness of such
Person in respect of borrowed money or evidenced by bonds, notes, debentures or
similar instruments or letters of credit (or reimbursement agreements in respect
thereof) or banker's acceptances or representing Capital Lease Obligations or
the balance deferred and unpaid of the purchase price of any property or
representing any Hedging Obligations, except any such balance that constitutes
an accrued expense or trade payable or customer advances, if and to the extent
any of the foregoing Indebtedness (other than letters of credit and Hedging
Obligations) would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP, as well as all Indebtedness of others secured
by a Lien on any asset of such Person (whether or not such Indebtedness is
assumed by such Person) and, to the extent not otherwise included, the Guarantee
by such Person of any Indebtedness of any other Person, provided that
Indebtedness shall not include the pledge by the Company of the Capital Stock of
an Unrestricted Subsidiary of the Company to secure Non-Recourse Debt of such
Unrestricted Subsidiary. The amount of any Indebtedness outstanding as of any
date shall be (a) the outstanding principal amount at any date of any
Indebtedness less the unamortized portion of such Indebtedness (together with
any interest thereon that is more than 30 days past due), in the case of any
Indebtedness that does not require current payments of interest, and (b) the
principal amount thereof, in the case of any other Indebtedness provided that
the principal amount of any Indebtedness that is denominated in any currency
other than United States dollars shall be the amount thereof, as determined
pursuant to the foregoing provision, converted into United States dollars at the
Spot Rate in effect on the date that such Indebtedness was incurred (or, if such
indebtedness was incurred prior to the Original Issuance Date, the Spot Rate in
effect on the Original Issuance Date). The incurrence by the Company or any of
its Restricted Subsidiaries of Indebtedness represented by (i) the accrual of
interest (including the issuance of Secondary Notes, "payment in kind"
securities or similar
8
instruments in respect of such accrued interest), (ii) the accretion of original
issue discount or (iii) the mere extension of the maturity of any Indebtedness
shall not be deemed to be an incurrence of Indebtedness).
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Instruments" means all "instruments", "chattel paper" or "letters of
credit" (each as defined in the Uniform Commercial Code) evidencing,
representing, arising from or existing in respect of, relating to, securing or
otherwise supporting the payment of any non-cash consideration to the extent
that such non-cash consideration consists of (i) publicly traded debt securities
of a Person, which securities are rated at least "BBB-" by S&P and at least
"Baa3" by Moody's or (ii) other Indebtedness or publicly traded Capital Stock of
a Person if (x) the lowest rated long-term, unsecured debt obligation issued by
such Person is rated at least "BBB-" by S&P and at least "Baa3" by Moody's or
(y) in the case of other Indebtedness, the payment of such other Indebtedness is
secured by an irrevocable letter of credit issued by a commercial bank having
capital and surplus in excess of $100,000,000 and long-term unsecured debt
obligations rated at least "A-" by S&P and least "A3" by Moody's. For purposes
of this definition, debt securities or Capital Stock of a Person shall be deemed
to be publicly traded if listed, or admitted to unlisted trading privileges, on
a national securities exchange or quoted in an automated interdealer quotation
system.
"Interest Payment Date" has the meaning assigned to such term in Exhibit A
hereto.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including, without limitation, Guarantees by the referent Person
of, and Liens on any assets of the referent Person securing, Indebtedness or
other obligations of other Persons), advances or capital contributions
(excluding commission, travel and similar advances to officers and employees
made in the ordinary course of business), purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities, together
with all items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP, provided that an investment by the Company for
consideration consisting of common equity securities of the Company shall not be
deemed to be an Investment (other than for purposes of clause (iii) of the
definition of "Qualified Proceeds"). If the Company or any Restricted Subsidiary
of the Company sells or otherwise disposes of any Equity Interests of any direct
or indirect Restricted Subsidiary of the Company such that, after giving effect
to any such sale or disposition, such Person is no longer a Subsidiary of the
Company, the Company shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the greater of book value or Fair Market
Value of the Equity Interests of such Restricted Subsidiary not sold or disposed
of in an amount determined as provided in the final paragraph of Section 4.06
hereof.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or the city in which the principal
corporate trust office of the Trustee is located, or at a place of payment, are
authorized by law, regulation or executive order to remain closed. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that
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place on the next succeeding day that is not a Legal Holiday, and no interest
shall accrue on such payment for the intervening period.
"License Holding Subsidiary" means any Restricted Subsidiary of the Company
that owns, leases or has a legal ownership interest, directly or indirectly, in
those certain C-, D-, E- or F-Block personal communications services licenses
granted by the FCC to any Subsidiary of the Company on or prior to the date
hereof or any substitute property therefor that the Company may, in its sole
discretion, expressly designate in writing from time to time hereafter. The
License Holding Subsidiaries existing on the Original Issuance Date are
identified on Schedule ____ hereto.
"License Holding Subsidiary Pledge Agreement" means each of the License
Holding Subsidiary Pledge Agreements, of even date herewith, between the Company
or a Restricted Subsidiary of the Company, as pledgor, and the Collateral Agent
as the secured party, to be executed in substantially the form of Exhibit __
hereto, as such agreement may be amended or supplemented from time to time
pursuant to the terms thereof, and any License Holding Subsidiary Pledge
Agreement hereafter entered into pursuant to Section 4.13 hereof pursuant to a
License Holding Subsidiary Pledge Agreement.
"License Holding Subsidiary Shares" means all shares of Capital Stock and
the certificates, if any, representing such Capital Stock, of the License
Holding Subsidiaries.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including, without limitation, any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement to
sell or give a security interest in and any filing of or agreement to give any
financing statement under the Uniform Commercial Code (or equivalent statutes)
of any jurisdiction).
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (a) any gain (or
loss), together with any related provision for taxes on such gain (or loss),
realized in connection with (i) any Asset Sale (including, without limitation,
dispositions pursuant to sale and leaseback transactions) or (ii) the
extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries; and (b) any extraordinary or nonrecurring gain (or loss), together
with any related provision for taxes on such extraordinary or nonrecurring gain
(or loss).
"Maturity Date" means, with respect to the Notes, ______ __, 2009.
"Net Proceeds" means, with respect to any Asset Sale (including any
Permitted License Holding Subsidiary Transaction that would otherwise constitute
an Asset Sale), the aggregate cash proceeds received by the Company or any of
its Restricted Subsidiaries in respect of any such Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of, without duplication,
(a) the direct costs relating to such Asset Sale (including, without limitation,
legal, accounting and investment banking fees, and sales commissions, recording
fees, title transfer fees and appraiser fees and cost of preparation of assets
for sale) and any relocation expenses incurred as a
10
result thereof, (b) taxes paid or payable as a result thereof , (c) amounts
required to be applied to the repayment of Indebtedness secured by a Lien on the
asset or assets that were the subject of such Asset Sale and (d) any reserve
established in accordance with GAAP or any amount placed in escrow, in either
case for adjustment in respect of the sale price of such asset or assets until
such time as such reserve is reversed or such escrow arrangement is terminated,
in which case Net Proceeds shall include only the amount of the reserve so
reversed or the amount returned to the Company or its Restricted Subsidiaries
from such escrow arrangement, as the case may be.
"Non-Recourse Debt" means Indebtedness (i) no default with respect to which
(including, without limitation, any rights that the holders thereof may have to
take enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any Indebtedness having a principal
amount or available undrawn commitment in excess of $_________ of the Company or
any of its Restricted Subsidiaries to declare a default on such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity; and (ii) as to which the lenders have been notified in
writing that they will not have any recourse to the stock (other than the stock
of an Unrestricted Subsidiary pledged by the Company to secure debt of such
Unrestricted Subsidiary) or assets of the Company or any of its Restricted
Subsidiaries; provided that in no event shall Indebtedness of any Unrestricted
Subsidiary fail to be Non-Recourse Debt solely as a result of any default
provisions contained in a guarantee thereof by the Company or any of its
Restricted Subsidiaries if the Company or such Restricted Subsidiary was
otherwise permitted to incur such guarantee pursuant to this Indenture.
"Note Custodian" means the Trustee, as custodian with respect to the Global
Notes, or any successor entity thereto.
"Notes" means the 12% Senior Secured Subordinated Notes due 2009 issued
pursuant to this Indenture, including, without limitation, all Secondary Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering" means the offering of the Notes issued on the Original Issuance
Date by the Company.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the Company
by two Officers of the Company, one of whom must be the principal executive
officer, the principal financial officer, the treasurer or the principal
accounting officer of the Company, that meets the requirements of Sections 13.04
and 13.05 hereof.
"Opinion of Counsel" means an opinion in form and substance reasonably
satisfactory to the Trustee and from legal counsel who is reasonably acceptable
to the Trustee, that meets the
11
requirements of Sections 13.04 and 13.05 hereof. The counsel may be an employee
of or counsel to the Company, any Subsidiary of the Company or the Trustee.
"Original Issuance Date" means _________, 1999, the date on which Notes are
first issued and authenticated under this Indenture.
"Pari Passu Indebtedness" means Indebtedness of the Company that ranks pari
passu in right of payment to the Notes.
"Participant" means, with respect to the Depositary, a Person who has an
account with the Depositary.
"Payment", for purposes of Article 10 of this Indenture, may consist of a
distribution, payment or other transfer of assets by or on behalf of the Company
(including, without limitation, a redemption, repurchase or other acquisition of
the Notes) from any source, of any kind or character, whether in cash,
securities or other property, by set-off or otherwise.
"Permitted Business" means _________________________________________.
"Permitted Investments" means (a) any Investment in the Company or in a
Restricted Subsidiary of the Company; (b) any Investment in cash or Cash
Equivalents; (c) any Investment by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investment (i) such Person
becomes a Restricted Subsidiary of the Company or (ii) such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Company or a Restricted
Subsidiary of the Company; (d) any Investment made as a result of the receipt of
non-cash consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.07 hereof; (e) any Investment acquired solely in
exchange for Equity Interests (other than Disqualified Stock) of the Company;
(f) any Investment in a Person engaged in a Permitted Business (other than an
Investment in an Unrestricted Subsidiary) having an aggregate Fair Market Value,
taken together with all other Investments made pursuant to this clause (f) that
are at that time outstanding, not to exceed the greater of (i) $20.0 million and
(ii) 15% of Total Assets at the time of such Investment (with the Fair Market
Value of each Investment being measured at the time made and without giving
effect to subsequent changes in value); and (g) Investments relating to any
special purpose Wholly Owned Subsidiary of the Company organized in connection
with a Receivables Facility that, in the good faith determination of the board
of directors of the Company, are necessary or advisable to effect such
Receivables Facility.
"Permitted Investment Accounts" means (a) certificates of deposit, time
deposits, Eurocurrency deposits and similar types of investments routinely
offered by commercial banks with final maturities of one year or less issued by
commercial banks having capital and surplus in excess of $100,000,000 or for
terms in excess of one year if such investment secures an obligation incurred in
the ordinary course of business; (b) commercial paper issued by any corporation,
if such commercial paper has credit ratings of at least A-1 by S&P and at least
P-1 by Xxxxx'x; (c) U.S. Government Obligations and other securities that are
obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America, with a maturity of one year or
less; provided that investments of the type described in (c) may be for terms in
excess of one year if such investment secures an obligation incurred in the
12
ordinary course of business; (d) purchase obligations having a term not
exceeding one year for instruments of the type described in (c); (e) shares of
money market mutual or similar funds having assets in excess of [$100,000,000];
provided that such funds are sponsored by commercial banks in which investments
pursuant to clause (a) of this definition have been made, and such shares do not
have an aggregate net asset value at any one time in excess of $[5,000,000]; (f)
certificates of deposit and time deposits in commercial banks made for the
purpose of supporting performance or surety bonds or letters of credit posted in
the ordinary course of business, to the extent any related Lien is a Permitted
Lien, or customs deposits made in the ordinary course of business; (g) accounts
receivable owing to the Company or any [Restricted] Subsidiary if created or
acquired in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms, and provided that nothing in this clause
shall prevent the Company or any [Restricted] Subsidiary from providing such
concessionary trade terms as management deems reasonable in the circumstances,
and Investments resulting from settlements or compromises of accounts
receivables or trade payables in the ordinary course of business; (h) payroll
advances in the ordinary course of business; (i) other advances and loans to
officers and employees of the Company or any [Restricted] Subsidiary[, so long
as the aggregate principal amount of such advances and loans (determined without
regard to any write-downs or write-offs) does not exceed $1,000,000 at any one
time outstanding]; (j) advances to officers and employees of the Company or any
[Restricted] Subsidiary to cover travel expenses; (k) Investments made after the
Original Issuance Date pursuant to binding agreements existing on the Original
Issuance Date in a cumulative amount not to exceed $1,000,000 from and after the
Original Issuance Date; and (l) Investments in Allowable Investments.
"Permitted Junior Securities" means Equity Interests in the Company or debt
securities of the Company that are subordinated to all Senior Indebtedness (and
any debt securities issued in exchange for Senior Indebtedness) to substantially
the same extent as, or to a greater extent than, the Notes are subordinated to
Senior Indebtedness.
"Permitted License Holding Subsidiary Transaction" means the sale
(including, without limitation, the issuance of Capital Stock or high-yield debt
securities in a public or private transaction), exchange, transfer, pledge or
any other disposition of the Collateral, in whole or in part, the execution,
delivery and performance of one or more joint venture agreements by one or more
of the License Holding Subsidiaries (or by the Company or any Subsidiary of the
Company that owns any Capital Stock in any respective License Holding
Subsidiary), the merger, consolidation or other business combination of any
nature of a License Holding Subsidiary with any other Person, or any other
similar such transaction.
"Permitted Liens" means: (i) Liens on property of a Person existing at the
time such Person is merged into or consolidated with the Company or any
Restricted Subsidiary, provided that such Liens were not incurred in
contemplation of such merger or consolidation and do not secure any property or
assets of the Company or any Restricted Subsidiary other than the property or
assets subject to the Liens prior to such merger or consolidation; (ii) Liens
existing on the Original Issuance Date; (iii) Liens securing Indebtedness
consisting of Capitalized Lease Obligations, purchase money Indebtedness,
mortgage financings, industrial revenue bonds or other monetary obligations, in
each case incurred solely for the purpose of financing all or any part of the
purchase price or cost of construction or installation of assets used in the
business of the Company or its Restricted Subsidiaries, or repairs, additions or
improvements to such assets, provided that (A) such Liens secure Indebtedness in
an amount not in excess of the original
13
purchase price or the original cost of any such assets or repair, additional or
improvement thereto (plus an amount equal to the reasonable fees and expenses in
connection with the incurrence of such Indebtedness), (B) such Liens do not
extend to any other assets of the Company or its Restricted Subsidiaries (and,
in the case of repair, addition or improvements to any such assets, such Lien
extends only to the assets (and improvements thereto or thereon) repaired, added
to or improved), (C) such Liens relate to or arise in connection with either the
incurrence or maintenance of such Indebtedness in connection with any Vendor
Financing Facilities, or Capital Expenditure Indebtedness and (D) such Liens
attach within 365 days of such purchase, construction, installation, repair,
addition or improvement; (iv) Liens to secure any refinancings, renewals,
extensions, modification or replacements (collectively, "refinancing") (or
successive refinancings), in whole or in part, of any Indebtedness secured by
Liens referred to in the clauses above so long as such Lien does not extend to
any other property (other than improvements thereto); (v) Liens securing letters
of credit entered into in the ordinary course of business and consistent with
past business practice; (vi) Liens on and pledges of the capital stock of any
Unrestricted Subsidiary securing Non-Recourse Debt of such Unrestricted
Subsidiary; (vii) Liens securing Indebtedness incurred pursuant to any Vendor
Financing Facility, (viii) Liens securing existing Indebtedness; and (ix) other
Liens securing Indebtedness that is permitted by the terms of this Indenture to
be outstanding having an aggregate principal amount at any one time outstanding
not to exceed $20.0 million.
"Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued within 120 days after repayment of,
in exchange for, or the net proceeds of which are used to extend, refinance,
renew, replace, defease or refund other Indebtedness of the Company or any of
its Restricted Subsidiaries; provided that (a) the principal amount (or accreted
value, if applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount of (or accreted value, if applicable), plus premium, if
any, and accrued interest on the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus the amount of reasonable expenses incurred
in connection therewith), (b) such Permitted Refinancing Indebtedness has a
final maturity date no earlier than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded, and (c) if the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded is subordinated in right of
payment to the Notes, such Permitted Refinancing Indebtedness is subordinated in
right of payment to, the Notes on terms at least as favorable, taken as a whole,
to the Holders of Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or agency or political subdivision thereof
(including, without limitation, any subdivision or ongoing business of any such
entity or substantially all of the assets of any such entity, subdivision or
business).
"Plan" means the Joint Plan of Reorganization Under Chapter 11 of the
Bankruptcy Code of the Company and certain of its Subsidiaries, dated
_______________, 1999, as amended and modified.
14
"Principals" means each "person" or "group" (as such terms are used in
Section 13(d) of the Exchange Act) that on the Original Issuance Date is the
"beneficial owner" (as such term is defined in Rule 13d-3 and Rule 13d-5 under
the Exchange Act), directly or indirectly through one or more intermediaries of
five percent or more of the voting power of the outstanding voting equity
interests of the Company or that is a member of the Board of Directors of the
Company.
"Proceeds" means all proceeds of, and all other profits, income or
receipts, in whatever form, arising from the ownership, collection, sale,
exchange, assignment or other disposition of, or realization upon, the
Collateral, including without limitation, all claims of the Company against
third parties for loss of, or for proceeds payable under, or unearned premiums
with respect to, any such Collateral, and all interest, dividends (cash or
otherwise) and other payments and distributions on or with respect to such
Collateral or in exchange for such Collateral, in each case whether now existing
or hereafter arising.
"Property" means, with respect to any Person, any interest of such Person
in any kind of property or asset, whether real, personal or mixed, or tangible
or intangible, including, without limitation, Capital Stock in any other Person.
"Qualified Proceeds" means any of the following or any combination of the
following: (i) cash; (ii) Cash Equivalents; (iii) assets (other than
Investments) that are used or useful in a Permitted Business; and (iv) the
Capital Stock of any Person engaged in a Permitted Business if, in connection
with the receipt by the Company or any Restricted Subsidiary of the Company of
such Capital Stock, (A) such Person becomes a Restricted Subsidiary of the
Company or any Restricted Subsidiary of the Company or (B) such Person is
merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or any
Restricted Subsidiary of the Company.
"Receivables Facility" means one or more receivables financing facilities,
as amended from time to time, pursuant to which the Company or any of its
Restricted Subsidiaries sells its accounts receivable to an Accounts Receivable
Subsidiary.
"Receivables Fees" means distributions or payments made directly or by
means of discounts with respect to any participation interests issued or sold in
connection with, and other fees paid to a Person that is not a Restricted
Subsidiary in connection with, any Receivables Facility.
"Related Party" means, with respect to any Principal, (i) any controlling
stockholder or partner of such Principal on the Original Issuance Date, or (ii)
any trust, corporation, partnership or other entity, the beneficiaries,
shareholders, partners, owners or Persons beneficially holding (directly or
through one or more Subsidiaries) a 51% or more controlling interest of which
consist of the Principals and/or such other Persons referred to in the
immediately preceding clauses (i) or (ii).
"Representative" means the indenture trustee or other trustee, agent or
representative for any Senior Indebtedness.
"Responsible Officer" when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any
15
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any direct or indirect Subsidiary
of the referent Person that is not an Unrestricted Subsidiary and shall include
any direct or indirect License Holding Subsidiaries.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Documents" means the Indenture, the Collateral Agency Agreement
and the License Holding Subsidiary Pledge Agreements.
"Secured Obligations" means (i) the obligations of the Company under this
Indenture and under the Notes, whether in respect of principal, premium, if any,
interest, or otherwise, (ii) the obligations of the Company under the Security
Documents and (iii) the obligations of the Company under each of its Vendor
Financing Facilities, to the extent the Collateral constitutes collateral
securing any such Vendor Financing Facility.
"Senior Indebtedness" means, with respect to any Person, (i) all
Indebtedness of such Person in existence on the Original Issuance Date permitted
by the Plan, (ii) Capital Expenditure Indebtedness, Capital Lease Obligations,
Indebtedness pursuant to any Vendor Financing Facility or other obligations, in
each case, the proceeds of which are used for the purpose of financing all or
any part of the purchase price or cost of construction or improvement of
property, plant or equipment (including, without limitation, acquisitions of
Capital Stock of a Person that becomes a Restricted Subsidiary to the extent of
the Fair Market Value of the property, plant or equipment so acquired) used in
the business of the Company or such Restricted Subsidiary, (iii) any other
Indebtedness consented to by the Trustee and by the Holders of at least 25% in
principal amount of the Notes then outstanding unless the instrument under which
such Indebtedness is incurred expressly provides that it is subordinated in
right of payment to any other Senior Indebtedness of such Person and (iv) all
Obligations with respect to the foregoing. Notwithstanding anything to the
contrary in the foregoing, Senior Indebtedness will not include (i) any
liability for federal, state, local or other taxes, (ii) any Indebtedness of
such Person to any of its Subsidiaries or (iii) any trade payables.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date
hereof.
"Solvent" means, when used with respect to any Person, that (a) the present
fair salable value of such Person's assets is in excess of the total amount of
such Person's liabilities; (b) such Person is able to pay its debts as they
become due; and (c) such Person does not have unreasonably small capital to
carry on such Person's business as theretofore operated and all businesses in
which such Person is about to engage.
16
"Spot Rate" means, for any currency, the spot rate at which such currency
is offered for sale against United States dollars as determined by reference to
the New York foreign exchange selling rates, as published in The Wall Street
Journal on such date of determination for the immediately preceding business day
or, if such rate is not available, as determined in any publicly available
source of similar market data.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subordinated Note Obligations" means all Obligations with respect to the
Notes, including, without limitation, principal, premium, if any, and interest
payable pursuant to the terms of the Notes (including, without limitation, upon
the acceleration or redemption thereof), together with and including, without
limitation, any amounts received or receivable upon the exercise of rights of
rescission or other rights of action (including, without limitation, claims for
damages) or otherwise.
"Subsidiary" means, with respect to any Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (b) any partnership or limited liability company (i) the sole
general partner or the managing general partner or managing member of which is
such Person or a Subsidiary of such Person or (ii) the only general partners or
managing members of which are such Person or of one or more Subsidiaries of such
Person (or any combination thereof).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA.
"Total Assets" means the total consolidated assets of the Company and its
Restricted Subsidiaries, as shown on the most recent balance sheet (excluding
the footnotes thereto) of the Company.
"Trustee" means, except solely for purposes of Section 8.05 as otherwise
specified therein, the party named as such above until a successor replaces it
in accordance with the applicable provisions of this Indenture and thereafter
means the successor serving hereunder.
"Unrestricted Subsidiary" means any Subsidiary that is designated by the
Board of Directors as an Unrestricted Subsidiary pursuant to a board resolution,
but only to the extent that such Subsidiary: (a) has no Indebtedness other than
Non-Recourse Debt; (b) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the Company
unless the terms of any such agreement, contract, arrangement or understanding
are no less favorable to the Company or such Restricted Subsidiary than those
that might be obtained at the time from Persons who are not Affiliates of the
Company; and (c) no Default or Event of Default is existing or will occur as a
consequence of such designation. Any
17
such designation by the board of directors shall be evidenced to the Trustee by
filing with the Trustee a certified copy of the board resolution giving effect
to such designation and an Officers' Certificate certifying that such
designation complied with the foregoing conditions and was permitted by Section
4.06 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as a Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date. The board of directors of the Company
may at any time designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that such designation shall be deemed to be an incurrence
of Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall only be
permitted if no Default or Event of Default would be in existence following such
designation.
"Uniform Commercial Code" means the Uniform Commercial Code as in effect
from time to time in the State of New York.
"Vendor Financing Facility" means any agreement(s) between the Borrower or
a Restricted Subsidiary of the Borrower and one or more vendors, lessors or
other third parties (or any affiliate of any such vendor, lessor or other third
party) providing financing for the acquisition (whether by lease, purchase or
otherwise), construction, installation, leasing or operation by the Borrower or
such Restricted Subsidiary of any equipment, capital assets, and shall include,
without, limitation, additional financing or working capital that is made
available to the Borrower as part of such "vendor financing".
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (b) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person, all of whose outstanding Capital Stock or other
ownership interests having by the terms thereof ordinary voting power to elect a
majority of the directors of such Restricted Subsidiary is at the time directly
or indirectly owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person or by such Person and one or more Wholly Owned
Restricted Subsidiaries of such Person.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
all of the outstanding Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be owned by such
Person or by one or more Wholly Owned Subsidiaries of such Person.
18
SECTION 1.02 OTHER DEFINITIONS.
Term Defined in Section
---- ------------------
"Affiliate Transaction" ................................... 4.08
"Allowable Investments" ................................... 4.07(c)
"Authentication Order" .................................... 2.02(d)
"Cash Collateral Account" ................................. 11.01
"Change of Control Offer" ................................. 4.15
"Change of Control Payment" ............................... 4.15
"Change of Control Payment Date" .......................... 4.15
"Computation Period" ...................................... 4.06(ii)
"Covenant Defeasance" ..................................... 8.03
"DTC" ..................................................... 2.06(f)
"Event of Default" ........................................ 6.01
"Fractional Secondary Note" ............................... 2.02(e)
"Guarantee Obligations" ................................... 12.01
"Issuing Subsidiary" ...................................... 4.14
"Legal Defeasance" ........................................ 8.02
"Paying Agent" ............................................ 2.03
"Payment Blockage Notice" ................................. 10.03
"Registrar" ............................................... 2.03
"Restricted Payments" ..................................... 4.06
"Secondary Notes" ......................................... 2.02(e)
"SEC Reports" ............................................. 4.03
SECTION 1.03 INCORPORATION OF TIA PROVISIONS.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor upon the
Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by Commission rule under the TIA
have the meanings so assigned to them.
SECTION 1.04 RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
19
(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the plural
include the singular;
(v) provisions apply to successive events and transactions; and
(vi) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the Commission from time to time.
ARTICLE 2
THE NOTES
SECTION 2.01 FORM AND DATING.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Indenture and the Company and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Global Notes. Notes (including Secondary Notes) shall be issued
initially in global form substantially in the form of Exhibit A attached hereto
(including, without limitation, the Global Note Legend and the "Schedule of
Exchanges of Interests in the Global Note" attached thereto), which shall be
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, at its [New York] office, as custodian for the Depositary, and
registered in the name of the Depositary or the nominee of the Depositary for
the accounts of Participants, duly executed by the Company and authenticated by
the Trustee as hereinafter provided. Each Global Note shall represent such of
the outstanding Notes as shall be specified therein and each shall provide that
it shall represent the aggregate principal amount of outstanding Notes from time
to time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and the issuance of Secondary
Notes. The aggregate principal amount of the Global Notes may from time to time
be increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as the case may be, as herein
provided. Any endorsement of a Global Note to reflect the amount of any increase
or decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the Note Custodian, at the direction of
the Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
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(c) Definitive Notes. Notes issued in definitive form shall be issued
substantially in the form of Exhibit A attached hereto (but without the Global
Note Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto), duly executed by the Company and authenticated
by Trustee as hereinafter provided.
SECTION 2.02 EXECUTION AND AUTHENTICATION.
(a) One Officer shall sign the Notes for the Company by manual or facsimile
signature.
(b) If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
(c) A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
At any time after the execution and delivery of this Indenture, the Company
may deliver Notes executed by the Company to the Trustee for authentication,
together with a written request or order signed in the name of the Company by
its chairman, its president, any vice president, its treasurer or an assistant
treasurer, its secretary or an assistant secretary, and delivered to the Trustee
for the authentication and delivery of such Notes; and the Trustee in accordance
with such a written order of the Company shall authenticate and deliver such
Notes as in this Indenture provided and not otherwise upon receipt by the
Trustee of the following:
(i) an Officer's Certificate complying with Section 13.05;
(ii) stock certificates representing all License Holding Subsidiary
Shares with respect to all License Holding Subsidiaries
identified in Schedule ___ hereto, registered in the name of the
Company [or a [Restricted] Subsidiary of the Company] and
accompanied by undated stock powers duly executed in blank, and
accompanied by any required transfer tax stamps, all in form and
substance reasonably satisfactory to the [Trustee];
(iii) the Collateral Agency Agreement executed and delivered by the
parties thereto setting forth, among other things, the relative
rights and remedies of the parties with respect to the
Collateral; and
(iv) the License Holding Subsidiary Pledge Agreements executed by the
Company [or one or more of the [Restricted] Subsidiaries of the
Company] and covering, in the aggregate, all of the Collateral.
(d) The Trustee shall, upon a written order of the Company signed by one
Officer (an "Authentication Order"), authenticate Notes for original issue up to
$225,000,000] in aggregate principal amount plus the aggregate principal amount
of any Secondary Notes issued pursuant to this Section 2.02. The aggregate
principal amount of Notes outstanding at any time may not exceed such amount
except as provided in Section 2.08 hereof.
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(e) On each Interest Payment Date, the Company shall, in lieu of a payment
in cash, execute and deliver to the Trustee for authentication, together with an
Authentication Order given not less than 15 nor more than 45 days prior to such
Interest Payment Date for the authentication and delivery thereof, additional
Notes ("Secondary Notes") in an aggregate principal amount equal to such
interest due and payable on the Notes on such Interest Payment Date in
accordance with Section 2.01(b). The Trustee, in accordance with such
Authentication Order, shall so authenticate and deliver to the Holders of record
on such record date such Secondary Notes requested in such Authentication Order
(such duly executed and authenticated Secondary Notes being of the same series
as the Notes), and the due issuance of such Secondary Notes shall constitute
full payment of such interest; provided, however, the Company may, at its
option, duly authorize the payment in cash of all or a portion of any interest
due on any such Interest Payment Date, in lieu of a payment in Secondary Notes,
by giving notice to the Holders and the Trustee not less than 15 nor more than
45 days prior to the record date for such Interest Payment Date; and provided
further, however, that in lieu of the issuance of any Secondary Notes the
principal amount of which (x) would be less than $1,000 or (y) would exceed the
largest integral multiple of $1,000 which is less than or equal to such
principal amount (in each case, a "Fractional Secondary Note"), the Company
shall, in the case of clause (y), issue a Secondary Note with a principal amount
equal to such largest integral multiple and shall, in the case of clauses (x)
and (y), in its sole discretion, either (1) on behalf of and for the accounts of
all Holders of Notes who would be entitled to Fractional Secondary Notes,
aggregate all such Fractional Secondary Notes and, on or before the tenth
Business Day following the applicable Interest Payment Date, sell such
aggregated Fractional Secondary Notes and, within six Business Days of such
sale, pay each such Holder its proportionate share of the net proceeds of such
sale, or (2) pay (on the applicable Interest Payment Date) each such Holder,
with respect to any Fractional Secondary Note that such Holder would otherwise
be entitled to receive, an amount in cash equal to the average closing price per
$1,000 principal amount of Notes for the ten trading days preceding the Business
Day immediately preceding the applicable Interest Payment Date multiplied by a
fraction, the numerator of which is the principal amount of such Fractional
Secondary Note otherwise issuable to such Holder and the denominator of which is
$1,000.
Each issuance of Secondary Notes in lieu of the payment in cash of all or
any portion of interest on the Notes shall be made pro rata with respect to the
outstanding Notes. All Secondary Notes shall be issued in the same series as the
Notes originally issued pursuant to this Indenture, and all Holders of Secondary
Notes shall be treated as Holders of Notes for any and all purposes of any
action of Holders or otherwise pursuant to this Indenture except as may
otherwise be required by law. Any such Secondary Notes shall be governed by this
Indenture and the terms of each such Secondary Note shall be identical to the
terms of the Notes except with respect to, as the case may be, the designation
of such Secondary Note (which may (but need not) indicate the Interest Payment
Date of its original issuance), its aggregate principal amount, its CUSIP number
or other required identifications, any required legends (including with respect
to taxation) and the date from which interest accrues and except as may
otherwise be required by law. Notwithstanding the foregoing, Secondary Notes may
be issued on any given Interest Payment Date in separate series if such is
required pursuant to a change in law after the date hereof, and, in such event,
the Holders of Secondary Notes shall continue to be treated in all respects as
Holders of Notes for all purposes of this Indenture (including with respect to
any action of Holders or otherwise pursuant to this Indenture) except as
required by such change in law.
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(f) The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes (including, without limitation, Secondary Notes,
if any). An authenticating agent may authenticate Notes whenever the Trustee may
do so. Each reference in this Indenture to authentication by the Trustee
includes authentication by such agent. An authenticating agent has the same
rights as an Agent to deal with Holders or an Affiliate of the Company.
SECTION 2.03 REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may appoint one or more co-registrars and one or more additional paying
agents. The term "Registrar" includes any co-registrar and the term "Paying
Agent" includes any additional paying agent. The Company may change any Paying
Agent or Registrar without notice to any Holder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints DTC to act as Depositary with respect to the
Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all money, if any, held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and will notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no further
liability for the money. If the Company or a Subsidiary acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee shall serve as Paying Agent for
the Notes.
SECTION 2.05 HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
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SECTION 2.06 TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if (i) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue as
Depositary for the Notes 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, (ii) the Company, at its option, elects to cause the Global Notes
(in whole but not in part) to be exchanged for Definitive Notes and delivers a
written notice to such effect to the Trustee or (iii) there shall have occurred
and be continuing a Default or Event of Default. In addition, beneficial
interests in a Global Note may be exchanged for Definitive Notes upon request
but only upon at least 20 days' prior written notice given to the Trustee by or
on behalf of DTC in accordance with customary procedures and subject to
compliance with Section 2.06(b)(ii) and Section 2.06(c). Upon the occurrence of
any of the preceding events upon which Definitive Notes are to be issued in
exchange for any Global Note or beneficial interests therein as specified above,
Definitive Notes shall be issued in such names and approved denominations as the
Depositary shall instruct the Trustee. Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof.
Every Note authenticated and delivered in exchange for, or in lieu of, a Global
Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or
2.10 hereof, shall be authenticated and delivered in the form of, and shall be,
a Global Note except as provided in this Section 2.06(a). A Global Note may not
be exchanged for another Note other than as provided in this Section 2.06(a) and
Sections 2.07 and 2.10; provided, however, that, beneficial interests in a
Global Note may be transferred and exchanged for beneficial interests in another
Global Note as provided in Section 2.06(b) hereof.
(b) Transfer and Exchange of Beneficial Interests in Global Notes for
Beneficial Interests in Global Notes or for Definitive Notes. The transfer and
exchange of beneficial interests in the Global Notes shall be effected through
the Depositary, in accordance with the provisions of this Indenture and the
Applicable Procedures. Transfers or exchanges of beneficial interests in Global
Notes for Definitive Notes shall also require compliance with Section 2.06(a),
Section 2.06(b)(ii) below and Section 2.06(c), and transfers or exchanges of
beneficial interests in Global Notes for beneficial interests in Global Notes
also shall require compliance with one or more of the other following
subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Global Note may be transferred to Persons who
take delivery thereof in the form of a beneficial interest in the same
Global Note. No written orders or instructions shall be required to be
delivered to the Registrar to effect the transfers described in this
Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests in a Global Note that are not subject to Section 2.06(b)(i)
above, the owner of such beneficial interest must deliver to the Registrar
either (A) (1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures
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directing the Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given in
accordance with the Applicable Procedures containing information regarding
the Participant account to be credited with such increase or (B) (1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an amount equal to
the beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Registrar containing information regarding
the Person in whose name such Definitive Note shall be registered to effect
the transfer or exchange referred to in clause (B)(1) above. Upon
satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities Act, the Trustee shall
adjust the principal amount of the relevant Global Note(s) pursuant to
Section 2.06(i) hereof.
(c) Transfer and Exchange of Beneficial Interests in Global Notes for
Definitive Notes. Subject to Section 2.06(a), if any holder of a beneficial
interest in a Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, then, upon satisfaction of
the conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall cause
the aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(g) hereof, and the Company shall execute
and the Trustee shall authenticate and deliver to the Person designated in the
instructions a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c) shall be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest shall
instruct the Registrar through instructions from the Depositary and the
Participant or Indirect Participant.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests in
Global Notes.
(i) Definitive Notes to Beneficial Interests in Global Notes. A Holder
of a Definitive Note may exchange such Note for a beneficial interest in a
Global Note or transfer such Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in a Global Note at any time.
Upon receipt of a request for such an exchange or transfer, the Trustee
shall cancel the applicable Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the Global Notes.
(ii) Issuance of Global Note. If any such exchange or transfer from a
Definitive Note to a beneficial interest is effected pursuant to Section
2.06(d)(i) above at a time when a Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or
more Global Notes in an aggregate principal amount equal to the principal
amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
provisions of this Section 2.06(e), the Registrar shall register the transfer or
exchange of Definitive Notes. Prior to such
25
registration of transfer or exchange, the requesting Holder shall present or
surrender to the Registrar the Definitive Notes duly endorsed or accompanied by
a written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing. In
addition, the requesting Holder shall provide any additional certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.06(e).
(i) Definitive Notes to Definitive Notes. A Holder of Definitive Notes
may transfer such Notes to a Person who takes delivery thereof in the form
of a Definitive Note. Upon receipt of a request to register such a
transfer, the Registrar shall register the Definitive Notes pursuant to the
instructions from the Holder thereof.
(f) Global Note Legend. The face of each Global Note issued under this
Indenture shall bear a legend (comprising two paragraphs) in substantially the
following form:
"Unless and until it is exchanged in whole or in part for Notes in
definitive form, this Note may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary or by the Depositary
or any such nominee to a successor Depositary or a nominee of such
successor Depositary. Unless this certificate is presented by an authorized
representative of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx) ("XXX"), to the issuer or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name
of Cede & Co. or such other name as may be requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or such other
entity as may be requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL in as much as the registered owner hereof, Cede & Co.,
has an interest herein.
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE OR CAUSE TO BE MADE SUCH
NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE
INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED PURSUANT TO SECTION
2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV)
THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE
PRIOR WRITTEN CONSENT OF NEXTWAVE TELECOM INC."
(g) Cancellation or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a
26
beneficial interest in another Global Note or for Definitive Notes, the
principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depositary at the direction of the Trustee to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a Person
who will take delivery thereof in the form of a beneficial interest in another
Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(h) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 3.06 and 4.08 hereof).
(iii) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global Notes
or Definitive Notes surrendered upon such registration of transfer or
exchange.
(v) The Company shall not be required (A) to issue, to register the
transfer of or to exchange any Notes during a period beginning at the
opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 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.
(vi) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent
or the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive Notes
in accordance with the provisions of Section 2.02 hereof.
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(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by
facsimile.
SECTION 2.07 REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the Company and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
SECTION 2.08 OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; provided, however, Notes held by the Company or a
Subsidiary of the Company shall not be deemed to be outstanding for purposes of
Section 3.07 hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.
Secondary Notes shall be deemed outstanding commencing as of the Interest
Payment Date with respect to which they are authenticated and delivered in lieu
of cash interest.
If the Paying Agent (other than the Company, a Subsidiary or an Affiliate
of any thereof) holds, on a redemption date or maturity date, money sufficient
to pay Notes payable on that date, then on and after that date such Notes shall
be deemed to be no longer outstanding and shall cease to accrue interest.
SECTION 2.09 TREASURY NOTES.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, including, without
limitation, for purposes of
28
Section 9.02, Notes owned by the Company, or by any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company, shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes that the Trustee
knows are so owned shall be so disregarded.
SECTION 2.10 TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery, the Company
may prepare, and the Trustee, upon receipt of an Authentication Order, shall
authenticate, temporary Notes. Temporary Notes shall be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as shall be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall, as soon as practicable upon receipt of an Authentication Order,
authenticate Definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of this
Indenture.
SECTION 2.11 CANCELLATION.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all cancelled Notes shall be delivered
to the Company. The Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
SECTION 2.12 DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, it shall pay
the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
SECTION 2.13 SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall upon a written request or order signed in the name of
the Company by its chairman, its president, any vice president, its treasurer or
any assistant treasurer, and delivered to the Trustee, cease to be of further
effect as to all outstanding Notes (except as to
29
surviving rights of exchange of the Notes, as expressly provided for herein or
pursuant hereto) and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture
when:
(a) either
(A) all Notes theretofore authenticated and delivered (other than (i)
Notes which have been destroyed, lost or stolen and which have been
replaced or repaid as provided in Section 2.07 and (ii) Notes for whose
payment money has theretofore been deposited in trust with the Trustee or
any Paying Agent or segregated and held in trust by the Company and
thereafter repaid to the Company or discharged from such trust, as provided
in Section 8.06) have been delivered to the Trustee for cancellation; or
(B) all Notes not theretofore delivered to the Trustee for
cancellation (other than Notes which have been destroyed, lost or stolen
and which have been replaced or paid as provided in Section 2.07)
(1) have become due and payable, or
(2) will become due and payable at their Stated Maturity within
one year, or
(3) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company, and the Company, in the case of (i), (ii) and (iii) above,
has irrevocably deposited or caused to be deposited with the Trustee
as trust funds in trust for such purpose in an amount sufficient to
pay and discharge the entire Indebtedness on such Notes not
theretofore delivered to the Trustee for cancellation, for principal,
premium, if any and accrued interest on the Notes to the date such
deposit (in the case of Notes which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be, together
with irrevocable written instructions from the Company directing the
Trustee to apply such funds to the payment thereof at Stated Maturity
or redemption, as the case may be;
(b) the Company has paid or cause to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officer's Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to compensate the Trustee under Section 7.07 and, if
money shall have been deposited with the Trustee pursuant to subclause (B) of
clause (a) of this Section 2.13, the obligations of the
30
Trustee to hold money in trust for the benefit of the holders of the Note,
including, without limitation, pursuant to Section 8.05 shall survive such
satisfaction and discharge.
ARTICLE 3
REDEMPTION AND PREPAYMENT
SECTION 3.01 NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 30
days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth (i) the clause of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
SECTION 3.02 SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, selection of
Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed, or, if the Notes are not so listed, on a pro rata basis, by
lot or by such method as the Trustee shall deem fair and appropriate; provided
that no Notes of $1,000 or less shall be redeemed in part.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
SECTION 3.03 NOTICE OF REDEMPTION.
Notices of redemption shall be mailed by first class mail at least 30 but
not more than 60 days before the redemption date to each Holder of Notes to be
redeemed at its registered address. If any Note is to be redeemed in part only,
the notice of redemption that relates to such Note shall state the portion of
the principal amount thereof to be redeemed. A new Note in principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Note. Notes called for redemption
become due on the date fixed for redemption. On and after the redemption date,
interest ceases to accrue on Notes or portions of them called for redemption.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
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(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy of the
CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense; provided, however, that the Company
shall have delivered to the Trustee, at least 30 days prior to the redemption
date, an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
SECTION 3.04 EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price.
SECTION 3.05 DEPOSIT OF REDEMPTION PRICE.
One Business Day prior to the redemption date, the Company shall deposit
with the Trustee or with the Paying Agent money sufficient to pay the redemption
price of and accrued interest on all Notes to be redeemed on that date. The
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption price of, and accrued interest on, all
Notes to be redeemed.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related Interest Payment Date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not
32
paid on such unpaid principal, in each case at the rate provided in the Notes
and in Section 4.01 hereof.
SECTION 3.06 NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and, upon receipt of the Company's written request, the Trustee shall as soon as
practicable authenticate for the Holder at the expense of the Company a new Note
equal in principal amount to the unredeemed portion of the Note surrendered.
SECTION 3.07 OPTIONAL REDEMPTION.
The Company may redeem the Notes, in whole or in part, at any time at the
option of the Company, upon not less than 30 nor more than 60 days' notice, in
cash at the redemption prices (expressed as percentages of principal amount) set
forth below, plus accrued and unpaid interest, if any, thereon to the applicable
redemption date, if redeemed during the twelve month period (or, with respect to
years (i) 1999, such shorter period beginning on the Original Issuance Date, and
(ii) 2009, such shorter period ending on the Maturity Date) beginning on April 1
of the years indicated below:
Year Percentage
---- ----------
1999............................................... 100.000%
2000............................................... 100.000%
2001............................................... 102.000%
2002............................................... 103.000%
2003............................................... 104.000%
2004............................................... 105.000%
2005............................................... 104.000%
2006............................................... 103.000%
2007............................................... 102.000%
2008............................................... 101.000%
2009............................................... 100.000%
Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08 MANDATORY REDEMPTION.
Except as provided in Section 4.07, the Company is not required to make
mandatory redemption of, or sinking fund payments with respect to, the Notes.
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ARTICLE 4
COVENANTS
SECTION 4.01 PAYMENT OF NOTES.
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
(i) holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due and (ii) is not prohibited
from paying such money to the Holders pursuant to the terms of this Indenture or
the Notes; provided, that any interest paid in Secondary Notes in lieu of cash
pursuant to Section 2.02 hereof shall be considered paid on the date due if such
Secondary Notes are executed, authenticated and delivered, and any cash payment
therein provided for is [paid] [deposited with the Paying Agent in immediately
available funds], in accordance with such Section 2.02.
SECTION 4.02 MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
the City of New York for such purposes. The Company shall give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03 hereof.
SECTION 4.03 REPORTS.
The Company shall file with the Trustee, within 15 days after it files them
with the Commission, copies of any information, documents or reports required to
be filed with the Commission pursuant to Section 13 or 15(d) of the Exchange Act
("SEC Reports"). The Company will furnish copies of the SEC Reports to the
Holders of Notes at the time the Company is required to file the same with the
Trustee and will make such information available to investors who request it in
writing and who execute a confidentiality agreement in form and substance
34
satisfactory to the Company. The Company and any obligor on the Notes shall also
comply with the other provisions of Section 314(a) of the TIA.
SECTION 4.04 COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest on the Notes is prohibited
or if such event has occurred, a description of the event and what action the
Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements when, and if, delivered pursuant to Section 4.03 above shall be
accompanied by a written statement of the Company's independent public
accountants (which shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Article 4 or Article 5 hereof or, if any
such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall, so long as any of the Notes are outstanding, deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default, an Officers' Certificate specifying such Default or Event of
Default and what action the Company is taking or proposes to take with respect
thereto.
SECTION 4.05 STAY, EXTENSION AND USURY LAWS.
The Company covenants that it shall not at any time insist upon, plead, or
in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company hereby expressly waives all benefit or advantage of any such law, and
covenants that it shall not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law has been enacted.
35
SECTION 4.06 RESTRICTED PAYMENTS.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, (a) declare or pay any dividend or make
any other payment or distribution on account of the Company's or any of its
Restricted Subsidiaries' Equity Interests (other than dividends or distributions
payable in Equity Interests (other than Disqualified Stock) of the Company or
dividends or distributions payable to the Company or any Wholly Owned Restricted
Subsidiary of the Company); (b) purchase, redeem, retire or otherwise acquire
for value any Equity Interests of the Company or any of its Restricted
Subsidiaries (other than any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company); (c) make any principal payment on or with
respect to, or purchase, redeem, defease, retire or otherwise acquire for value,
any Indebtedness of the Company that is subordinated in right of payment to the
Notes, except in accordance with the mandatory redemption or repayment
provisions set forth in the original documentation governing such Indebtedness;
or (d) make any Restricted Investment (all such payments and other actions set
forth in clauses (a) through (d) above being collectively referred to as
"Restricted Payments"), unless, at the time of and after giving effect to such
Restricted Payment:
(i) no Default or Event of Default shall have occurred and be continuing or
would occur as a consequence thereof; and
(ii) such Restricted Payment, together with the aggregate amount of all
other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Original Issuance Date (excluding Restricted
Payments permitted by clauses (a) (to the extent that the declaration of
any dividend referred to therein reduces amounts available for Restricted
Payments pursuant to this clause (ii)), (b) through (i), (l), (m), and (o)
of the next succeeding paragraph), is less than the sum, without
duplication, of (A) (x) the Consolidated EBITDA of the Company for the
period (taken as one accounting period) from the Original Issuance Date to
the last day of the last full fiscal quarter prior to the date of the
proposed Restricted Payment (the "Computation Period") minus (y) the
Consolidated Interest Expense of the Company for the Computation Period,
plus (B) 100% of the Qualified Proceeds received by the Company on or after
the Original Issuance Date from contributions to the Company's capital or
from the issue or sale on or after the Original Issuance Date of Equity
Interests (other than Disqualified Stock) of the Company or of Disqualified
Stock or convertible debt securities of the Company to the extent that they
have been converted into such Equity Interests (other than Equity
Interests, Disqualified Stock or convertible debt securities sold to a
Subsidiary of the Company and other than Disqualified Stock or convertible
debt securities that have been converted into Disqualified Stock), plus (C)
the amount equal to the net reduction in Investments in Persons after the
Original Issuance Date who are not Restricted Subsidiaries (other than
Permitted Investments) resulting from (x) Qualified Proceeds received as a
dividend, repayment of a loan or advance or other transfer of assets
(valued at the Fair Market Value thereof) to the Company or any Restricted
Subsidiary from such Persons, (y) Qualified Proceeds received upon the sale
or liquidation of such Investment and (z) the redesignation of Unrestricted
Subsidiaries (excluding any increase in the amount available for Restricted
Payments pursuant to clause (k) below arising from the redesignation of
such Unrestricted Subsidiary) whose assets are used or useful in, or which
is engaged in, one or more Permitted Businesses as Restricted Subsidiaries
(valued
36
(proportionate to the Company's Equity Interest in such Subsidiary) at the
Fair Market Value of the net assets of such Subsidiary at the time of such
redesignation).
The foregoing provisions will not prohibit:
(a) the payment of any non-cash dividend or other non-cash payment or
distribution;
(b) the redemption, repurchase, retirement, defeasance or other acquisition
of any subordinated Indebtedness or Equity Interests of the Company in exchange
for, or out of (i) the net cash proceeds of the substantially concurrent sale
(other than to a Subsidiary of the Company) of, other Equity Interests of the
Company (other than any Disqualified Stock) or (ii) a reserve, sinking fund or
other fund established for such purpose as part of the issuance, provided that
the amount of any such net cash proceeds or such sinking fund(s) or reserve(s)
that are utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition shall be excluded from clause (ii)(B) of the preceding
paragraph;
(c) the defeasance, redemption, repurchase, retirement or other acquisition
of subordinated Indebtedness of the Company with the net cash proceeds from an
incurrence of, or in exchange for, Permitted Refinancing Indebtedness;
(d) the repurchase, redemption or other acquisition or retirement for value
of any Equity Interests of the Company or held by any member of the Company's
(or any of its Restricted Subsidiaries') management pursuant to any management
equity subscription agreement or stock option agreement, provided that the
aggregate cash portion of the price paid for all such repurchased, redeemed,
acquired or retired Equity Interests shall not exceed (x) $5 million in any
calendar year (with unused amounts in any calendar year being carried over to
succeeding calendar years subject to a maximum of $10 million in any calendar
year), plus (y) the aggregate net cash proceeds received by the Company during
such calendar year from any issuance of Equity Interests by the Company to
members of management of the Company and its Restricted Subsidiaries (provided
that the amount of any such net cash proceeds that are used to permit an
acquisition or retirement for value pursuant to this clause (d) shall be
excluded from clause (ii)(B) of the preceding paragraph) and (ii) no Default or
Event of Default shall have occurred and be continuing immediately after such
transaction;
(e) payments and transactions in connection with the Plan, the Offering,
any Vendor Financing Facility, Capital Lease Obligations or similar obligations
(including, without limitation, commitment, syndication and arrangement fees
payable thereunder) and the application of the proceeds thereof, and the payment
of fees and expenses with respect thereto;
(f) the payment of dividends by a Restricted Subsidiary on any class of
common stock of such Restricted Subsidiary if (i) such dividend is paid pro rata
to all holders of such class of common stock and (ii) at least 51% of such class
of common stock is held by the Company or one or more of its Restricted
Subsidiaries;
(g) the repurchase of any class of common stock of a Restricted Subsidiary
if (i) such repurchase is made pro rata with respect to such class of common
stock and (ii) at least 51% of such class of common stock is held by the Company
or one or more of its Restricted Subsidiaries;
37
(h) the declaration and payment of dividends to holders of any class or
series of Disqualified Stock of the Company or any Restricted Subsidiary issued
on or after the Original Issuance Date; provided that no Default or Event of
Default shall have occurred and be continuing immediately after making such
Restricted Payment;
(i) repurchases by the Company or any Subsidiary of Equity Interests deemed
to occur upon exercise of stock options if such Equity Interests represent a
portion of the exercise price of such options;
(j) the payment of dividends or distributions on the Company's common
stock, following the first underwritten public offering of the Company's common
stock after the Original Issuance Date, of up to 6.0% per annum of the net
proceeds received by the Company from such underwritten public offering of its
common stock or the net proceeds received by the Company from such underwritten
public offering of its common stock as common equity other than with respect to
public offerings with respect to the Company's common stock registered on Form
S-8; provided that no Default or Event of Default shall have occurred and be
continuing immediately after any such payment of dividends or distributions;
(k) any other Restricted Payment which, together with all other Restricted
Payments made pursuant to this clause (k) since the Original Issuance Date, up
to $10 million (determined from time to time by giving effect to all subsequent
reductions in the amount of any Restricted Investment made pursuant to this
clause (k) either as a result of (i) the repayment or disposition thereof for
cash or (ii) the redesignation of an Unrestricted Subsidiary as a Restricted
Subsidiary (valued proportionate to the Company's Equity Interest in such
Subsidiary at the time of such redesignation) at the Fair Market Value of the
net assets of such Subsidiary at the time of such redesignation), in the case of
clause (i) and (ii), not to exceed the amount of such Restricted Investment
previously made pursuant to this clause (k); provided that no Default or Event
of Default shall have occurred and be continuing immediately after making such
Restricted Payment;
(l) the pledge by the Company of the Capital Stock of an Unrestricted
Subsidiary of the Company to secure Non-Recourse Debt of such Unrestricted
Subsidiary;
(m) the purchase, redemption or other acquisition or retirement for value
of any Equity Interests of any Restricted Subsidiary issued after the Original
Issuance Date, provided that the aggregate price paid for any such repurchased,
redeemed, acquired or retired Equity Interests shall not exceed the sum of (x)
the amount of cash and Cash Equivalents received by such Restricted Subsidiary
from the issue or sale thereof and (y) any accrued dividends thereon;
(n) any Investment in an Unrestricted Subsidiary that is funded by
Qualified Proceeds received by the Company on or after the Original Issuance
Date from contributions to the Company's capital or from the issue and sale on
or after the Original Issuance Date of Equity Interests of the Company or of
Disqualified Stock or convertible debt securities to the extent they have been
converted into such Equity Interests (other than Equity Interests, Disqualified
Stock or convertible debt securities sold to a Subsidiary of the Company and
other than Disqualified Stock or convertible debt securities that have been
converted into Disqualified Stock) in an amount (measured at the time such
Investment is made and without giving effect to subsequent changes in value)
that does not exceed the amount of such Qualified Proceeds (excluding any such
38
Qualified Proceeds to the extent utilized to permit a prior "Restricted Payment"
pursuant to clause (ii)(B) of the preceding paragraph); and
(o) distributions or payments of Receivables Fees.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Default or an
Event of Default. For purposes of making such designation, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under the first paragraph of this Section 4.06. All such
outstanding Investments will be deemed to constitute Restricted Investments in
an amount equal to the greater of (i) the net book value of such Investments at
the time of such designation and (ii) the Fair Market Value of such Investments
at the time of such designation. Such designation will only be permitted if such
Restricted Investment would be permitted at such time and if such Restricted
Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
The amount of (i) all Restricted Payments (other than cash) shall be the
Fair Market Value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment
and (ii) Qualified Proceeds (other than cash) shall be the Fair Market Value on
the date of receipt thereof by the Company of such Qualified Proceeds. The Fair
Market Value of any non-cash Restricted Payment shall be determined by the board
of directors of the Company whose resolution with respect thereto shall be
delivered to the Trustee. Not later than the date of making any Restricted
Payment, the Company shall deliver to the Trustee an Officers' Certificate
stating that such Restricted Payment is permitted and setting forth the basis
upon which the calculations required by this Section 4.06 were computed.
SECTION 4.07 ASSET SALES.
(a) Except as otherwise provided in clauses (c) and (d) below, the Company
shall not, and shall not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale unless (a) the Company or such Restricted Subsidiary,
as the case may be, receives consideration at the time of such Asset Sale at
least equal to the Fair Market Value (evidenced by a resolution of the board of
directors set forth in an Officers' Certificate delivered to the Trustee) of the
assets (excluding any Collateral) issued or sold or otherwise disposed of and
(b) at least 75% of the consideration therefor received by the Company or such
Restricted Subsidiary is in the form of (i) cash or Cash Equivalents or (ii)
property or assets that are used or useful in a Permitted Business, or the
Capital Stock of any Person engaged in a Permitted Business if, as a result of
the acquisition by the Company or any Restricted Subsidiary thereof, such Person
becomes a Restricted Subsidiary.
(b) For purposes of this Section 4.07 each of the following shall be deemed
cash: (x) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet), of the Company or any Restricted
Subsidiary (other than contingent liabilities and liabilities that are by their
terms subordinated to the Notes or any Guarantee thereof) that are assumed by
the transferee of any such assets pursuant to a customary novation agreement
that releases the Company or such Restricted Subsidiary from further liability,
(y) any securities, notes or other obligations received by the Company or any
such Restricted Subsidiary from such
39
transferee that are contemporaneously (subject to ordinary settlement periods)
converted by the Company or such Restricted Subsidiary into cash or Cash
Equivalents (to the extent of the cash or Cash Equivalents received), and (z)
any Designated Noncash Consideration received by the Company or any of its
Restricted Subsidiaries in such Asset Sale having an aggregate Fair Market
Value, taken together with all other Designated Noncash Consideration received
pursuant to this clause (z) that is at that time outstanding, not to exceed 15%
of Total Assets at the time of the receipt of such Designated Noncash
Consideration (with the Fair Market Value of each item of Designated Noncash
Consideration being measured at the time received and without giving effect to
subsequent changes in value); provided that the 75% limitation referred to in
clause (b) above will not apply to any Asset Sale in which the cash or Cash
Equivalents portion of the consideration received therefrom, determined in
accordance with subclauses (x), (y) and (z) above, is equal to or greater than
what the after-tax proceeds would have been had such Asset Sale complied with
the aforementioned 75% limitation.
(c) Notwithstanding anything to the contrary in this Indenture, and subject
only to the applicable requirements of the TIA, if any, the Company or any
Subsidiary of the Company may, at any time and from time to time, in its sole
and absolute discretion, without any other action whatsoever, effect and
consummate, or permit or cause to be effected and consummated, any Permitted
License Holding Subsidiary Transaction. In the event of the consummation of any
Permitted License Holding Subsidiary Transaction, the Company shall, except as
otherwise provided below, cause cash in an amount equal to the Net Proceeds from
such Permitted License Holding Subsidiary Transaction allocable to the
Collateral, if any, to be delivered and pledged to the Collateral Agent upon the
closing of such Permitted License Holding Subsidiary Transaction (i) for deposit
in the Cash Collateral Account pursuant to Section 11.01 or (ii) if the
consideration for any Permitted License Holding Subsidiary Transaction includes
Instruments, the Company shall cause such Instruments to be delivered and
pledged to the Collateral Agent on or prior to the third day after the closing
of such Permitted License Holding Subsidiary Transaction (or upon the closing
thereof, if the Capital Stock or Property disposed of therein is part of the
Collateral) for deposit in the Cash Collateral Account pursuant to Section
11.02, and pending such delivery, the Company shall hold such cash or
Instruments, as applicable, in trust for the Collateral Agent and the Holders;
provided, however, that notwithstanding the foregoing, the Company may promptly
apply (or cause to be applied), in its sole and absolute discretion, the Net
Proceeds of any one or more Permitted License Holding Subsidiary Transactions
allocable to the Collateral (as determined by the Board of Directors based upon
an opinion as to the fairness to the Holders from a financial point of view
issued by an accounting, appraisal or investment banking firm of national
standing; provided no such fairness opinion or valuation shall be required in
the event the value of the assets transferred does not exceed $10 million) to
either (i) redeem the Notes, provided that, in the event that the aggregate
principal amount of the Notes then outstanding exceeds the available Net
Proceeds of such Permitted License Holding Subsidiary Transaction(s), the
Trustee shall select the Notes to be purchased on a pro rata basis; (ii) invest
in any other assets, provided that such assets (or any other assets of
reasonably equivalent value as such assets) shall be or immediately become the
property of a License Holding Subsidiary and provision shall have been made to
create in favor of the Collateral Agent a pledge of the Capital Stock of such
License Holding Subsidiary in accordance with Section 4.13 hereof; or (iii) for
working capital and general corporate purposes, provided that provision shall
have been made to create in favor of the Collateral Agent a pledge of the
Capital Stock of such License Holding Subsidiary, which shall have acquired such
other assets of reasonably equivalent value, in
40
accordance with Section 4.13 hereof (subclauses (i), (ii) and (iii) shall be
referred to herein as a "Allowable Investments").
To the extent the Permitted License Holding Subsidiary Transaction
constitutes or involves the issuance or sale of Capital Stock or high-yield debt
securities in a public or private transaction, each Issuing Subsidiary (as
defined in Section 4.14) shall be entitled to retain 50% of the gross proceeds
from such transaction, net of attorneys fees, finders' 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, and the balance of such net proceeds shall
be used by the Company in accordance with subclauses (i) and (ii) of the
definition of Allowable Investments.
The Collateral Agent and the Trustee shall take, or cause to be taken, any
other action, including, without limitation, releasing any Liens in connection
with a Permitted License Holding Subsidiary Transaction, as may be reasonably
requested by the Company in connection with the consummation of a Permitted
License Holding Subsidiary Transaction.
(d) Notwithstanding anything to the contrary in this Indenture, the Company
may sell, lease, convey, dispose or transfer C-block licenses that are owned,
leased or otherwise held by License Holding Subsidiaries with a value up to 15%
of the Aggregate License Value (as defined below) to the Federal Communications
Commission ("FCC") or as otherwise directed by the FCC. Such 15% determination
shall be made by the Board of Directors and shall be based upon (i) the
aggregate value of the Company's C-block licenses, as determined by the
bankruptcy court by decision dated May 12, 1999, in Adversary Proceeding No.
98-5178A, as captioned NEXTWAVE PERSONAL COMMUNICATIONS INC. against FEDERAL
COMMUNICATIONS COMMISSION (the "Aggregate License Value") and (ii) valuation
reports prepared on behalf of the Company in connection with such adversary
proceeding.
The consent of fifty-one percent of the Holders shall be required for the
Company to sell, lease, convey, dispose or transfer C-block licenses with a
value exceeding 15% of the Aggregate License Value to the FCC or as otherwise
directed by the FCC.
(e) To the extent the Company or any of its Restricted Subsidiaries
forecloses on any of its assets and such foreclosure yields a surplus, the
Company or such Restricted Subsidiary shall apply such surplus to an Allowable
Investment.
SECTION 4.08 TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or Guarantee with, or for the benefit
of, any Affiliate of the Company (each of the foregoing, an "Affiliate
Transaction"), unless (a) such Affiliate Transaction is on terms that are no
less favorable to the Company or such Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Restricted Subsidiary with an unrelated Person and (b) the Company delivers to
the Trustee, with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of $10
million, either (i) a resolution of the Board of Directors set forth in
41
an Officers' Certificate certifying that such Affiliate Transaction complies
with clause (a) above and that such Affiliate Transaction has been approved by a
majority of the disinterested members of the Board of Directors or (ii) an
opinion as to the fairness to the Holders of such Affiliate Transaction from a
financial point of view issued by an accounting, appraisal or investment banking
firm of national standing; provided, further, that, if the Affiliate Transaction
involves the transfer of cash proceeds from one Restricted Subsidiary to another
Restricted Subsidiary, it shall be a condition precedent to such transfer that
the transferee Restricted Subsidiary is Solvent as determined by the Board of
Directors in its sole and absolute discretion.
Notwithstanding the foregoing, the following items shall not be deemed to
be Affiliate Transactions: (a) customary directors' fees, indemnification or
similar arrangements or any employment agreement or other compensation plan or
arrangement entered into by the Company or any of its Restricted Subsidiaries in
the ordinary course of business (including, without limitation, loans made to
employees in the ordinary course of business) and consistent with the past
practice of the Company or such Restricted Subsidiary; (b) transactions between
or among the Company and/or its Restricted Subsidiaries; (c) any agreement as in
effect on the Original Issuance Date or any amendment thereto (so long as such
amendment is not disadvantageous to the Holders of the Notes in any material
respect) or any transaction contemplated thereby as more specifically set forth
on Schedule __ hereto; (d) payments and transactions in connection with the
Plan, and the Offering and the application of the proceeds thereof, and the
payment of the fees and expenses with respect thereto; (e) Restricted Payments
that are permitted by Section 4.06 hereof and any Permitted Investments; (f)
transactions that are permitted or implemented in accordance with the Plan; and
(g) any issuance of capital stock of the Company other than Disqualified Stock.
SECTION 4.09 LIENS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien, other than a Permitted Lien; provided that, in any case
involving a Lien securing subordinated Indebtedness of the Company, such Lien is
subordinated to the Lien securing the Notes to the same extent that such
subordinated Indebtedness is subordinated to the Notes. With the exception of
Liens securing Senior Indebtedness, the Company shall grant no additional Liens
on Capital Stock of a License Holding Subsidiary that is pledged pursuant to a
License Holding Subsidiary Pledge Agreement without the prior consent of the
Holders, which consent shall not be unreasonably withheld.
SECTION 4.10 CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) the
corporate, partnership or other existence of itself and each of its
Subsidiaries, in accordance with the respective organizational documents (as the
same may be amended from time to time) of the Company or any such Subsidiary and
(ii) the rights (charter and statutory), licenses and franchises of the Company
and its Subsidiaries; provided, however, that the Company shall not be required
to preserve any such right, license or franchise, or the corporate, partnership
or other existence of itself and any of its Subsidiaries, if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and its Subsidiaries, taken as a
whole, and that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
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SECTION 4.11 NO SENIOR SUBORDINATED INDEBTEDNESS.
The Company shall not incur any Indebtedness that is subordinate or junior
in right of payment to any Senior Indebtedness and senior in right of payment to
the Notes.
SECTION 4.12 PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or is
paid to all Holders of the Notes that consent, waive or agree to amend in the
time frame set forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.13 ESTABLISHMENT OF SUBSIDIARIES.
If any new License Holding Subsidiary is established or acquired, or the
Company designates a Subsidiary as a "License Holding Subsidiary" (in accordance
the definition of the term License Holding Subsidiary), or ownership of one or
more of the FCC licenses described in the definition of License Holding
Subsidiary is transferred from a License Holding Subsidiary to any Subsidiary
which is not then a party to a License Holding Subsidiary Pledge Agreement
[(other than in an Asset Sale complying with Section 4.07)], the Company shall[,
as a condition precedent to such establishment, acquisition, designation or
transfer,] execute and deliver to the Collateral Agent (or cause any Subsidiary
of the Company that holds of record all or part of the Capital Stock of any such
new License Holding Subsidiary or Subsidiary to execute and deliver) a License
Holding Subsidiary Pledge Agreement and to deliver and pledge to the Collateral
Agent pursuant to such License Holding Subsidiary Pledge Agreement all such
License Holding Subsidiary Shares, in the form required by the License Holding
Subsidiary Pledge Agreement, and free of all Liens other than the Lien of such
License Holding Subsidiary Pledge Agreement. [For purposes of this Section 4.13,
if the License Holding Subsidiary Shares being pledged are the Capital Stock of
a Subsidiary organized under the laws of a jurisdiction other than the United
States, a State thereof or the District of Columbia, the License Holding
Subsidiary Pledge Agreement with respect thereto shall be substantially in the
form of Exhibit ___ hereto, with such changes therein (which shall be
satisfactory to the Collateral Agent), as are required by the law of the
jurisdiction in which such License Holding Subsidiary is organized in order to
grant a security interest in such Capital Stock comparable to that provided for
in Exhibit ___ hereto, as evidenced by an Opinion of Counsel (which shall also
address the validity of such agreement and the creation, perfection and
enforceability of such security interest).]
SECTION 4.14 ISSUANCE OF SUBSIDIARY CAPITAL STOCK.
Except as provided in Section 4.07(c) and in the proviso to this sentence,
the Company will cause each License Holding Subsidiary not to issue any Capital
Stock in such License Holding Subsidiary or any debt securities exchangeable or
convertible for or into such Capital Stock, provided that (i) such License
Holding Subsidiary (the "Issuing Subsidiary") may issue additional Capital Stock
to the Company or a License Holding Subsidiary, which Capital Stock shall be
delivered and pledged to the Collateral Agent pursuant to Section 11.03(a) of
this Indenture or [Section ___ ] of the applicable License Holding Subsidiary
Pledge Agreement, as
43
the case may be[, and (ii) if the Issuing Subsidiary is not a Wholly Owned
Subsidiary, the Issuing Subsidiary may also simultaneously issue additional
shares of Capital Stock of the same class to other shareholders of the Issuing
Subsidiary, provided that the issuance of Capital Stock pursuant to this clause
(ii), when combined with the issuance pursuant to clause (i), will not reduce
the percentage of Capital Stock of the Issuing Subsidiary which was owned
directly or indirectly by the Company immediately prior to such issuances].
SECTION 4.15 OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder of Notes will
have the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple thereof) of such Holder's Notes pursuant to the
offer described below (the "Change of Control Offer") at an offer price in cash
equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid
interest, if any, thereon to the date of repurchase (the "Change of Control
Payment"). Within 60 days following any Change of Control, the Company will (or
will cause the Trustee to) mail a notice to each Holder describing the
transaction or transactions that constitute the Change of Control and offering
to repurchase Notes on the date specified in such notice, which date shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed (the "Change of Control Payment Date"), pursuant to the procedures
required by this Indenture and described in such notice. The Company shall
comply with the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such laws and
regulations are applicable in connection with the repurchase of the Notes as a
result of a Change of Control. To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Indenture
relating to such Change of Control Offer, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations described in this Indenture by virtue thereof.
On the Change of Control Payment Date, the Company shall, to the extent
lawful, (a) accept for payment all Notes or portions thereof properly tendered
pursuant to the Change of Control Offer, (b) deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions thereof so tendered and (c) deliver or cause to be delivered to the
Trustee the Notes so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Company. The Paying Agent will promptly mail to each Holder of Notes so tendered
the Change of Control Payment for such Notes, and the Trustee will promptly
authenticate and mail (or cause to be transferred by book-entry) to each Holder
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered, if any; provided that each such new Note will be in a principal
amount of $1,000 or an integral multiple thereof. Prior to complying with the
provisions of this Section 4.15, but in any event within 90 days following a
Change of Control, the Company shall use commercially reasonable efforts to
obtain the requisite consents, if any, under all agreements governing
outstanding Senior Indebtedness to permit the repurchase of Notes required by
this Section 4.15. The Company shall publicly announce the results of the Change
of Control Offer on or as soon as practicable after the Change of Control
Payment Date.
Notwithstanding anything to the contrary in this Section 4.15, the Company
will not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times
and otherwise in compliance with the requirements set forth in this Indenture
applicable to a Change of Control Offer made by the
44
Company and purchases all Notes validly tendered and not withdrawn under such
Change of Control Offer.
SECTION 4.16 GUARANTEES BY LICENSE HOLDING SUBSIDIARIES.
If any new License Holding Subsidiary is established, or the Company
designates a Subsidiary as a "License Holding Subsidiary" (in accordance the
definition of the term License Holding Subsidiary), or ownership of one or more
of the FCC licenses described in the definition of License Holding Subsidiary is
transferred from a License Holding Subsidiary to any Subsidiary which has not
executed a Guarantee in favor of the Holders, the Company shall[, as a condition
precedent to such establishment, designation or transfer, execute and deliver to
the Collateral Agent (or cause any Subsidiary of the Company that holds of
record all or part of the Capital Stock of any such new License Holding
Subsidiary or Subsidiary to execute and deliver) a Guarantee Agreement in
accordance with Article 12 of this Indenture; provided that the Company shall
have the option to designate from time to time any Subsidiary as a guarantor for
the purposes of Article 12 of this Indenture.
SECTION 4.17 CONSUMMATION OF PLAN OF REORGANIZATION.
No provision of this Indenture shall prevent the Company or any Subsidiary
of the Company from consummating the Plan and the transactions contemplated
thereby.
ARTICLE 5
SUCCESSORS
SECTION 5.01 MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company may not consolidate or merge with or into (whether or not the
Company is the surviving corporation), or sell, assign, transfer, convey or
otherwise dispose of all or substantially all of its properties or assets in one
or more related transactions to, another Person, unless (a) the Company is the
surviving corporation or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, conveyance or other disposition shall have been made is a
corporation organized or existing under the laws of the United States, any state
thereof or the District of Columbia, (b) the Person formed by or surviving any
such consolidation or merger (if other than the Company) or the Person to which
such sale, assignment, transfer, conveyance or other disposition shall have been
made assumes all the obligations of the Company under the Notes and this
Indenture pursuant to a supplemental indenture in a form reasonably satisfactory
to the Trustee and (c) immediately after such transaction no Default or Event of
Default exists. The foregoing will not prohibit the consummation of any
transaction(s) contemplated by the Plan or (i) a merger between the Company and
a Wholly Owned Restricted Subsidiary or (ii) a merger between the Company and an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another State of the United States so long as, in each case, the amount of
Indebtedness of the Company and its Restricted Subsidiaries is not increased
thereby. The Company shall not lease all or substantially all of its assets to
any Person.
45
SECTION 5.02 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation of the Company with or any merger of the Company
into another Person, or any sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 EVENTS OF DEFAULT.
Each of the following constitutes an Event of Default:
(a) default for 10 days in the payment when due of interest on the Notes
(whether or not prohibited by Article 10 hereof); or
(b) default in payment when due of the principal of or premium, if any, on
the Notes (whether or not prohibited by Article 10 hereof) and such default
continues for a period of five Business Days; or
(c) failure by the Company for 60 days after notice from the Trustee or the
Holders of at least 33-1/3% in principal amount of the Notes then outstanding to
comply with any of its other agreements in this Indenture or the Notes; or
(d) default under any mortgage, indenture or instrument under which there
may be issued or by which there may be secured or evidenced any Indebtedness for
money borrowed by the Company or any of its Restricted Subsidiaries (or the
payment of which is guaranteed by the Company or any of its Restricted
Subsidiaries), whether such Indebtedness or Guarantee now exists, or is created
after the Original Issuance Date, which default results in the acceleration of
such Indebtedness prior to its stated final maturity and the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness the maturity of which has been so accelerated, aggregates $50.0
million or more; or
(e) failure by the Company or any of its Restricted Subsidiaries to pay
final judgments aggregating in excess of $50.0 million (net of any amounts with
respect to which a reputable and creditworthy insurance company has acknowledged
liability in writing), which judgments are not paid, discharged or stayed for a
period of 60 days; or
46
(f) the Company or any of its Restricted Subsidiaries that is a Significant
Subsidiary:
(i) commences a voluntary case under any applicable Bankruptcy Law,
(ii) consents to the entry of an order for relief against it in an
involuntary case under any applicable Bankruptcy Law,
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property,
(iv) makes a general assignment for the benefit of its creditors, or
(v) generally is not paying its debts as they become due; or
(g) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary or for all or substantially
all of the property of the Company or any of its Restricted Subsidiaries
that is a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive days.
SECTION 6.02 ACCELERATION.
If any Event of Default (other than an Event of Default specified in clause
(g) or (h) of Section 6.01 hereof with respect to the Company) occurs and is
continuing, the Holders of at least 25% in principal amount of the then
outstanding Notes may, only on the terms and subject to the conditions set forth
in the Collateral Agency Agreement, direct the Trustee to declare all the Notes
to be due and payable immediately; provided, that so long as any Senior
Indebtedness shall be outstanding, such acceleration shall not be effective
until five Business Days after receipt by the Company and the lender under any
Senior Indebtedness of written notice of such acceleration. Upon any such
declaration, the Notes shall become due and payable immediately. Notwithstanding
the foregoing, if an Event of Default specified in clause (f) or (g) of Section
6.01 hereof occurs with respect to the Company, (i) all outstanding Notes shall,
ipso facto, be due and payable immediately without further action or notice and
(ii) the Company shall promptly notify the Trustee of such Event of Default
(although the Notes shall become due and payable immediately upon the occurrence
of such Event of Default as specified in clause (i) regardless of whether the
Company so notifies the Trustee). The Holders of a majority in aggregate
principal amount of the then outstanding Notes by written notice to the Trustee
may on behalf of all of the Holders rescind an acceleration and its consequences
if the rescission would not conflict with any judgment or decree and if all
existing Events of Default (except nonpayment of principal, interest
47
or premium, if any, that has become due solely because of the acceleration) have
been cured or waived, provided that, in the event of a declaration of
acceleration of the Notes because an Event of Default has occurred and is
continuing as a result of the acceleration of any Indebtedness described in
clause (d) of Section 6.01 hereof, the declaration of acceleration of the Notes
shall be automatically annulled if the holders of any Indebtedness described in
clause (d) of Section 6.01 hereof have rescinded the declaration of acceleration
in respect of such Indebtedness within 30 days of the date of such declaration
and if (i) the annulment of the acceleration of the Notes would not conflict
with any judgment or decree of a court of competent jurisdiction and (ii) all
existing Events of Default, except non-payment of principal or interest on the
Notes that became due solely because of the acceleration of the Notes, have been
cured or waived.
SECTION 6.03 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may, only on
the terms and subject to the conditions set forth in the Collateral Agency
Agreement, pursue any available remedy to collect the payment of principal,
premium, if any, and interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
SECTION 6.04 WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by notice to the Trustee may on behalf of the Holders of
all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium, if any, or interest on, the Notes
(including, without limitation, in connection with an offer to purchase)
(provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Notes may rescind an acceleration and its consequences,
including, without limitation, any related payment default that resulted from
such acceleration). Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereon.
SECTION 6.05 CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding Notes may
direct the time, method and place of conducting any proceeding for exercising
any remedy available to the Trustee or exercising any trust or power conferred
on it. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture that the Trustee determines may be unduly prejudicial
to the rights of other Holders of Notes or that may result in the incurrence of
liability by the Trustee.
48
SECTION 6.06 LIMITATION ON SUITS.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 33-1/3% in principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder of a Note or Holders of Notes offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal amount
of the then outstanding Notes do not give the Trustee a direction inconsistent
with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
SECTION 6.07 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and interest
on the Note, on or after the respective due dates expressed in the Note
(including, without limitation, in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.08 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest, if any, on overdue principal and, to the extent lawful, interest and
such further amount as shall be sufficient to cover the costs and expenses of
collection, including, without limitation, the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including, without limitation, any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders of the Notes allowed in any judicial proceedings
relative to the Company (or any other obligor upon the Notes), its creditors or
its property and shall be entitled and empowered to collect, receive and
distribute any money or
49
other property payable or deliverable on any such claims and any custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee, and in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 6.10 PRIORITIES.
If the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including, without limitation, payment of all compensation,
expense and liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to holders of Senior Indebtedness to the extent required by the
Collateral Agency Agreement and Article 10 hereof;
Third: to Holders of Notes for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes for
principal, premium, if any, and interest, respectively; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes 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 a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including, without limitation,
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Trustee, a suit by a
Holder of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in principal amount of the then outstanding Notes.
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ARTICLE 7
TRUSTEE
SECTION 7.01 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture but need
not verify the contents thereof.
(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section 7.01;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02, 6.04 or 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c), (e) and (f) of this Section 7.01 and Section 7.02 hereof.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
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(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
(g) Except with respect to Section 4.01 hereof, the Trustee shall have no
duty to inquire as to the performance of the Company's covenants in Article 4
hereof. In addition, the Trustee shall not be deemed to have knowledge of any
Default or Event of Default except (i) any Event of Default occurring pursuant
to Sections 6.01(a), 6.01(b) and 4.01 or (ii) any Default or Event of Default of
which the Trustee shall have received written notification or obtained actual
knowledge.
(h) 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
may, in its discretion, 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.
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(i) The Trustee shall not be required to give any bond or surety in respect
of the performance of its powers and duties hereunder.
(j) Delivery of reports, information and documents to the Trustee under
Section 4.03 is for informational purposes only and the Trustee's receipt of the
foregoing shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Company's compliance with any of their covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 7.03 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee may become the owner or pledgee of Notes and may otherwise deal
with the Company or any Affiliate of the Company with the same rights it would
have if it were not Trustee. However, in the event that the Trustee acquires any
conflicting interest it must eliminate such conflict within 90 days, apply to
the Commission for permission to continue as trustee or resign. Any Agent may do
the same with like rights and duties. The Trustee is also subject to Sections
7.10 and 7.11 hereof.
SECTION 7.04 TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
SECTION 7.05 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of Notes a notice of the
Default or Event of Default within 45 days after such Default or Event Default
becomes known to the Trustee. Except in the case of a Default or Event of
Default in payment of principal of, premium, if any, or interest on any Note,
the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders of the Notes.
SECTION 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES.
Within 60 days after each March 1 beginning with the March 1 following the
Original Issuance Date, and for so long as Notes remain outstanding, the Trustee
shall mail to the Holders of the Notes a brief report dated as of such reporting
date that complies with TIA ss. 313(a) (but if no event described in TIA ss.
313(a) has occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Trustee also shall comply with TIA ss. 313(b).
The Trustee shall also transmit by mail all reports as required by TIA ss.
313(c).
A copy of each report at the time of its mailing to the Holders of Notes
shall be mailed to the Company and filed with the Commission and each stock
exchange on which the Notes are
53
listed in accordance with TIA ss. 313(d). The Company shall promptly notify the
Trustee when the Notes are listed on any stock exchange.
SECTION 7.07 COMPENSATION AND INDEMNITY.
The Company shall pay the Trustee from time to time reasonable compensation
for its acceptance of this Indenture and services hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company shall reimburse the Trustee promptly upon request for
all reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Company shall indemnify the Trustee and its agents, employees,
officers, directors and shareholders for, and hold the same harmless against,
any and all losses, liabilities or expenses (including, without limitation,
reasonable attorneys' fees and expenses) incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including, without limitation, the costs and expenses of enforcing
this Indenture against the Company (including, without limitation, this Section
7.07) and defending itself against any claim (whether asserted by the Company or
any Holder or any other person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its negligence or bad
faith. The Trustee shall notify the Company promptly of any claim for which it
may seek indemnity. Failure by the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall defend the
claim with counsel reasonably satisfactory to the Trustee, and the Trustee shall
cooperate in the defense at the Company's expense. The Trustee may have separate
counsel and the Company shall pay the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent,
which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive the
resignation or removal of the Trustee and/or the satisfaction and discharge or
termination of this Indenture.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the resignation or removal
of the Trustee and/or the satisfaction and discharge or termination of this
Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(f) hereof occurs, the expenses and the
compensation for the services (including, without limitation, the fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to the
extent applicable.
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SECTION 7.08 REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Holders of Notes of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder of a Note who has been
a Holder of a Note for at least six months, fails to comply with Section 7.10
hereof, such Holder of a Note may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Holders of the Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
55
SECTION 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the requirements
of TIAss. 310(a)(1), (2) and (5). The Trustee is subject to TIAss. 310(b).
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
SECTION 8.02 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder:
56
(a) the rights of Holders of outstanding Notes to receive payments in
respect of the principal of, premium, if any, and interest, if any, on such
Notes when such payments are due from the trust referred to below,
(b) the Company's obligations with respect to the Notes concerning issuing
temporary Notes, registration of Notes, mutilated, destroyed, lost or stolen
Notes and the maintenance of an office or agency for payment and money for
security payments held in trust,
(c) the rights, powers, trusts, duties and immunities of the Trustee, and
the Company's obligations in connection therewith and
(d) the Legal Defeasance provisions of this Indenture.
SECTION 8.03 COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.06, 4.07, 4.08, 4.09,
4.11 and 4.12 hereof with respect to the outstanding Notes on and after the date
the conditions set forth in Section 8.04 are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. In addition, upon the Company's exercise
under Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(c) through 6.01(e) hereof shall not constitute Events of Default.
SECTION 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance,
(a) the Company must irrevocably deposit with the Trustee, in trust, for
the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Notes on the stated maturity or on the applicable redemption date,
as
57
the case may be, and the Company must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(b) in the case of Legal Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel in the United States reasonably acceptable to
the Trustee confirming that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (ii) since the Original
Issuance Date, there has been a change in the applicable federal income tax law,
in either case to the effect that, and based thereon such Opinion of Counsel
shall confirm that, subject to customary assumptions and exclusions, the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of Covenant Defeasance, the Company shall have delivered to
the Trustee an Opinion of Counsel in the United States reasonably acceptable to
the Trustee confirming that, subject to customary assumptions and exclusions,
the Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Covenant Defeasance had not
occurred;
(d) no Default or Event of Default shall have occurred and be continuing on
the date of such deposit (other than a Default or Event of Default resulting
from the borrowing of funds to be applied to such deposit);
(e) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;
(f) the Company must have delivered to the Trustee an Opinion of Counsel to
the effect that, subject to customary assumptions and exclusions, after the
123rd day following the deposit, the trust funds will not be subject to the
effect of Section 547 of the United States Bankruptcy Code or any analogous New
York State law provision or any other applicable federal or New York bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally;
(g) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and
(h) the Company must deliver to the Trustee an Officers' Certificate and an
Opinion of Counsel (which opinion may be subject to customary assumptions and
exclusions), each stating that all conditions precedent provided for relating to
the Legal Defeasance or the Covenant Defeasance have been complied with.
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SECTION 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including, without limitation, the proceeds thereof) deposited with
the Trustee (or other qualifying trustee, collectively for purposes of this
Section 8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of the
outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including, without limitation, the
Company acting as Paying Agent) as the Trustee may determine, to the Holders of
such Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
8.04(a) hereof), are in excess of the amount thereof that would then be required
to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.06 REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
and premium, if any, or interest has become due and payable shall be paid to the
Company on its request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Note shall thereafter, as a secured creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustees thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 8.07 REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining,
59
restraining or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, premium, if
any, or interest on any Note following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company and the Trustee
may amend or supplement this Indenture or the Notes without the consent of any
Holder of a Note:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof (including,
without limitation, the related definitions) in a manner that does not
materially adversely affect any Holder;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Notes by a successor to the Company pursuant to Article 5 hereof;
(d) to make any change that would provide any additional rights or benefits
to the Holders of the Notes or that does not adversely affect the legal rights
hereunder of any Holder of the Note;
(e) to comply with requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the TIA; or
(f) to provide for Guarantees of the Notes and the execution of License
Holding Subsidiary Pledge Agreements in accordance with Section 4.13.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
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SECTION 9.02 WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and the Trustee
may amend or supplement this Indenture (including, without limitation, Section
4.08 hereof) and the Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount of the Notes (including,
without limitation, Secondary Notes, if any) then outstanding voting as a single
class (including, without limitation, consents obtained in connection with a
purchase of, or tender offer or exchange offer for, the Notes), and, subject to
Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (other
than a Default or Event of Default in the payment of the principal of, premium,
if any, or interest on the Notes, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of this
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including, without
limitation, Secondary Notes, if any) voting as a single class (including,
without limitation, consents obtained in connection with the purchase of, or
tender offer or exchange offer for, the Notes). Sections 2.08 and 2.09 hereof
shall determine which Notes are considered to be "outstanding" for purposes of
this Section 9.02.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Company in the execution of such amended or supplemental Indenture
unless such amended or supplemental Indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated to, enter into
such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes (including, without
limitation, Secondary Notes, if any) then outstanding voting as a single class
may waive compliance in a particular instance by the Company with any provision
of this Indenture or the Notes. However, without the consent of each Holder
affected, an amendment or waiver under this Section 9.02 may not (with respect
to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to an
amendment, supplement or waiver,
(b) reduce the principal of or change the fixed maturity of any Note or
alter the provisions with respect to the redemption or repurchase of the Notes
(other than Section 4.07 hereof),
61
(c) reduce the rate of or extend the time for payment of interest on any
Note,
(d) waive a Default or Event of Default in the payment of principal of or
premium, if any, or interest on the Notes (except a rescission of acceleration
of the Notes by the Holders of at least a majority in aggregate principal amount
of the Notes and a waiver of the payment default that resulted from such
acceleration),
(e) make any Note payable in money other than that stated in the Notes,
(f) make any change in the provisions of this Indenture relating to waivers
of past Defaults,
(g) waive a redemption or repurchase payment with respect to any Note
(other than Section 4.07 hereof), or
(h) make any change in the foregoing amendment and waiver provisions.
SECTION 9.03 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amended or supplemental Indenture that complies with the TIA as then
in effect.
SECTION 9.04 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement, waiver or other action permitted by this Indenture, which record
date shall be the date so fixed by the Company notwithstanding the provisions of
the TIA. If a record date is fixed, then notwithstanding the second sentence of
the immediately preceding paragraph, those Persons who were Holders at such
record date, and only those Persons (or their duly designed proxies), shall be
entitled to revoke any consent previously given, whether or not such Persons
continue to be Holders after such record date. No such consent shall be valid or
effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder of a Note, unless it makes a change described in any of clauses (a)
through (h) of Section 9.02, in which case, the amendment, supplement or waiver
shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note; provided that any such waiver shall not impair or
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affect the right of any Holder to receive payment of principal and premium of
and interest on a Note, on or after the respective dates set for such amounts to
become due and payable expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates.
SECTION 9.05 NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until its Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in relying upon, in addition to the documents required by Section
13.04 hereof, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
ARTICLE 10
SUBORDINATION
SECTION 10.01 AGREEMENT TO SUBORDINATE AND PRIORITY.
The Company agrees, and each Holder by accepting a Note agrees, that the
Payment of Subordinated Note Obligations are subordinated in right of Payment,
to the extent and in the manner set forth in this Article 10, to the prior
Payment in full in cash or cash equivalents of all Senior Indebtedness, whether
outstanding on the Original Issuance Date or thereafter incurred and that the
subordination is for the benefit of the holders of Senior Indebtedness. The
provisions of this Article 10 shall constitute a continuing offer to all Persons
that, in reliance upon such provisions, become holders of, or continue to hold
Senior Indebtedness, and they or each of them may enforce the rights of holders
of Senior Indebtedness hereunder, subject to the terms and provisions hereof.
Each of the Trustee and each of the Holders agrees that, notwithstanding
any terms or rights in this Indenture or at equity or in law to the contrary,
the Trustee, for the benefit of the Holders, shall exercise no rights and
remedies against the Collateral except as expressly permitted in the Collateral
Agency Agreement.
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SECTION 10.02 LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any Distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property, an
assignment for the benefit of creditors or any marshaling of the Company's
assets and liabilities, (a) the holders of Senior Indebtedness will be entitled
to receive Payment in full in cash or cash equivalents of all Obligations due in
respect of such Senior Indebtedness (including, without limitation, interest
after the commencement of any such proceeding at the rate specified in the
applicable Senior Indebtedness) before the Holders of Notes will be entitled to
receive any Payment with respect to the Subordinated Note Obligations (except
that Holders of Notes may receive and retain Permitted Junior Securities and
Payments and other Distributions made from the trust described in Section 8.04
hereof), and (b) until all Obligations with respect to Senior Indebtedness are
paid in full in cash or cash equivalents, any Distribution to which the Holders
of Notes would be entitled but for this Article 10 shall be made to the holders
of Senior Indebtedness (except that Holders of Notes may receive and retain
Permitted Junior Securities and Payments and other Distributions made from the
trust described Section 8.04 hereof) as their interests appear; provided,
however, that nothing in this Section 10.02 shall prevent the issuance of
Secondary Notes in lieu of a cash payment of any or all interest due on any
Interest Payment Date.
SECTION 10.03 DEFAULT ON ANY SENIOR INDEBTEDNESS.
The Company may not make any Payment or Distribution to the Trustee or any
Holder upon or in respect of the Subordinated Note Obligations (except in
Permitted Junior Securities or from the trust described in Section 8.04 hereof)
until all principal and other obligations with respect to Senior Indebtedness
have been paid in full in cash or cash equivalents, if
(a) a default in the Payment of the principal (including, without
limitation, reimbursement obligations in respect of letters of credit) of,
premium, if any, or interest on or commitment, letter of credit or
administrative fees relating to, any other Senior Indebtedness occurs and is
continuing beyond any applicable period of grace in the agreement, indenture or
other document governing such Senior Indebtedness, or
(b) any other default occurs and is continuing with respect to the Senior
Indebtedness that permits holders of the Senior Indebtedness as to which such
default relates to accelerate its maturity and the Trustee receives a notice of
such default (a "Payment Blockage Notice") from the Company or the holders of
any Senior Indebtedness (or their Representative);
provided, however, that nothing in this Section 10.03 shall prevent the issuance
of Secondary Notes in lieu of a cash payment of any or all interest due on any
Interest Payment Date.
Payments on the Notes may and shall be resumed (a) in the case of a payment
default, upon the date on which such default is cured or waived and (b) in case
of a nonpayment default, the earlier of the date on which such nonpayment
default is cured or waived or 179 days after the date on which the applicable
Payment Blockage Notice is received, unless the maturity of any Senior
Indebtedness has been accelerated. No new period of payment blockage may be
commenced unless and until 360 days have elapsed since the effectiveness of the
immediately prior Payment Blockage Notice. No nonpayment default that existed or
was continuing on the
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date of delivery of any Payment Blockage Notice to the Trustee shall be, or be
made, the basis for a subsequent Payment Blockage Notice unless such default
shall have been waived or cured for a period of not less than 90 days.
SECTION 10.04 ACCELERATION OF SECURITIES.
If Payment of the Notes is accelerated because of an Event of Default, the
Company shall promptly notify holders of Senior Indebtedness of the
acceleration.
SECTION 10.05 WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee or any Holder receives any Payment of any
Subordinated Note Obligations at a time when the Trustee or such Holder, as
applicable, has actual knowledge that such Payment is prohibited by Section
10.02 or 10.03 hereof, such Payment shall be held by the Trustee or such Holder,
in trust for the benefit of, and shall be paid forthwith over and delivered,
upon written request, to, the holders of Senior Indebtedness as their interests
may appear or their Representative under the indenture or other agreement (if
any) pursuant to which Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the Payment of all
Obligations with respect to Senior Indebtedness remaining unpaid to the extent
necessary to pay such Obligations in full in accordance with their terms, after
giving effect to any concurrent Payment or Distribution to or for the holders of
Senior Indebtedness; provided, however, that nothing in this Section 10.05 shall
prevent the issuance of Secondary Notes in lieu of a cash payment of any or all
interest due on any Interest Payment Date.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform only such obligations on the part of the Trustee as are specifically
set forth in this Article 10, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Indebtedness, and shall not be liable to any such
holders if the Trustee shall pay over or distribute to or on behalf of Holders
or the Company or any other Person money or assets to which any holders of
Senior Indebtedness shall be entitled by virtue of this Article 10, except if
such Payment is made as a result of the willful misconduct or gross negligence
of the Trustee.
SECTION 10.06 NOTICE BY COMPANY.
The Company shall promptly notify the Trustee and the Paying Agent of any
facts known to the Company that would cause a Payment of any Obligations with
respect to the Notes to violate this Article 10, but failure to give such notice
shall not affect the subordination of the Notes to the Senior Indebtedness as
provided in this Article 10.
SECTION 10.07 SUBROGATION.
After all Senior Indebtedness is paid in full in cash or cash equivalents
and until the Notes are paid in full, Holders of Notes shall be subrogated
(equally and ratably with all other Indebtedness pari passu with the Notes) to
the rights of holders of Senior Indebtedness to receive Distributions applicable
to Senior Indebtedness to the extent that Distributions otherwise payable to the
Holders of Notes have been applied to the Payment of Senior Indebtedness. A
Distribution
65
made under this Article 10 to holders of Senior Indebtedness that otherwise
would have been made to Holders of Notes is not, as between the Company and
Holders, a Payment by the Company on the Notes.
SECTION 10.08 RELATIVE RIGHTS.
This Article 10 defines the relative rights of Holders of Notes and holders
of Senior Indebtedness. Nothing in this Indenture shall:
(1) impair, as between the Company and holders of notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(2) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of Senior
Indebtedness; or
(3) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Indebtedness to receive
Distributions and Payments otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay principal of or
interest on a Note on the due date, the failure is still a Default or Event of
Default.
SECTION 10.09 SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Indebtedness to enforce the subordination
of the Indebtedness evidenced by the Notes shall be impaired by any act or
failure to act by the Company or any Holder or by the failure of the Company or
any Holder to comply with this Indenture.
SECTION 10.10 DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a Distribution is to be made or a notice given to holders of
Senior Indebtedness, the Distribution may be made and the notice given to their
Representative.
Upon any Payment or Distribution of assets of the Company referred to in
this Article 10, the Trustee and the Holders of Notes shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction or upon any
certificate of such Representative or of the liquidating trustee or agent or
other Person making any Distribution to the Trustee or to the Holders of Notes
for the purpose of ascertaining the Persons entitled to participate in such
Distribution, the holders of the Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
10.
SECTION 10.11 RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 10 or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any facts that would prohibit
66
the making of any Payment or Distribution by the Trustee, and the Trustee and
the Paying Agent may continue to make Payments on the Notes, unless the Trustee
shall have received at its Corporate Trust Office at least five Business Days
prior to the date of such payment written notice of facts that would cause the
Payment of any Obligations with respect to the Notes to violate this Article 10.
Only the Company or a Representative may give the notice. Nothing in this
Article 10 shall impair the claims of, or payments to, the Trustee under or
pursuant to Section 7.07 hereof.
The Trustee may hold Senior Indebtedness with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights.
SECTION 10.12 AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of Notes, by the Holder's acceptance thereof, authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 10, and appoints the Trustee to act as such Holder's attorney-in-fact
for any and all such purposes. If the Trustee does not file a proper proof of
claim or proof of debt in the form required in any proceeding referred to in
Section 6.09 hereof at least 30 days before the expiration of the time to file
such claim, the Representative is hereby authorized to file an appropriate claim
for and on behalf of the Holders of the Notes.
SECTION 10.13 NO WAIVER OF SUBORDINATION PROVISIONS.
(a) No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act by any such holder.
(b) Without in any way limiting the generality of paragraph (a) of this
Section 10.13, the holders of Senior Indebtedness may, at any time and from time
to time, without the consent of or notice to the Trustee or any Holder, without
incurring responsibility to any Holder and without impairing or releasing the
subordination provided in this Article 10 or the obligations hereunder of the
Holders to the holders of Senior Indebtedness, do any one or more of the
following: (i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, any Senior Indebtedness or any instrument
evidencing the same or any agreement under which Senior Indebtedness is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of Senior Indebtedness; and (iv)
exercise or refrain from exercising any rights against either Company or any
other Person.
SECTION 10.14 AMENDMENTS.
The provisions of this Article 10 shall not be amended or modified without
the written consent of the holders of all Senior Indebtedness.
SECTION 10.15 TRUSTEE'S COMPENSATION NOT PREJUDICED.
Nothing in this Article 10 shall apply to amounts due to the Trustee pursuant to
other sections of this Indenture.
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ARTICLE 11
COLLATERAL AND SECURITY
SECTION 11.01 CASH COLLATERAL ACCOUNT.
(a) There is hereby established by the Trustee for the benefit of the
Collateral Agent and the Holders a cash collateral account, subject to such
applicable laws and such applicable regulations of the Board of Governors of the
Federal Reserve System and of any other appropriate banking or governmental
authority as may now or hereafter be in effect (the "Cash Collateral Account"),
in the name and under the sole dominion and control of the Collateral Agent. The
Company shall, except as provided in Section 4.07(c), deposit from time to time
into the Cash Collateral Account all Net Proceeds of any Permitted License
Holding Subsidiary Transaction allocable to the Collateral. Any income received
by the Collateral Agent with respect to the balance from time to time standing
to the credit of the Cash Collateral Account, including any interest or capital
gains on Permitted Investment Accounts or Instruments, shall remain, or be
deposited, in the Cash Collateral Account. All such income, interest or capital
gains which are received by the Company shall be received in trust for the
benefit of the Collateral Agent and the Holders and shall be paid over to the
Collateral Agent as Collateral in the same form as received (with any necessary
endorsement) to be released or disposed of only as specified in subsection (b),
and the Company shall deposit any such interest and other payments that are in
the form of cash into the Cash Collateral Account. All right, title and interest
in and to the cash amounts on deposit from time to time in the Cash Collateral
Account, together with any Permitted Investment Accounts from time to time made
pursuant to this Section 11.01 and any Instruments deposited therein, shall vest
in the Collateral Agent, shall constitute part of the Collateral hereunder and
shall not constitute payment of the Secured Obligations until applied thereto as
provided in the applicable Security Document(s).
(b) The balance from time to time standing to the credit of the Cash
Collateral Account shall be distributed to the Company entitled thereto only as
permitted under Section 4.07 or the Collateral Agency Agreement; provided that
the Collateral Agent shall not distribute to the Company or such other Person
any such funds upon the occurrence and continuation of a Default except pursuant
to the express terms of the Collateral Agency Agreement. If immediately
available cash on deposit in the Cash Collateral Account is not sufficient to
make any such permitted distribution, the Collateral Agent shall liquidate as
promptly as practicable Permitted Investment Accounts as required to obtain
sufficient cash to make such distribution and, notwithstanding any other
provision of Sections 4.07 and 6.01 or this Section 11.01 or any other Security
Document, such distribution shall not be made until such liquidation has taken
place.
(c) Amounts on deposit in the Cash Collateral Account shall be invested and
reinvested from time to time in such Permitted Investment Accounts as are
described in clauses (a), (b), (c) and (d) of the definition of such term, as
the Company shall instruct the Collateral Agent in writing, provided, however,
that if a Default shall have occurred and be continuing, the Collateral Agent
shall have the exclusive right to make investment decisions with respect to
amounts on deposit in the Cash Collateral Account. Such Permitted Investment
Accounts shall be held in the name and be under the sole dominion and control of
the Collateral Agent, subject to the right of the Trustee under Article 6 and
the Security Documents. In order to provide the Collateral Agent, for the
benefit of the Holders, with a perfected security interest therein, each such
Permitted Investment Account, or, in the case of the Permitted
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Investment Accounts described in clause (d) of the definition of that term, each
security which is the subject of a repurchase obligation, shall be either:
(i) evidenced by negotiable certificates or instruments, or if
non-negotiable then issued in the name of the Collateral Agent, which (i)
are delivered (together with any appropriate instruments of transfer) to,
and held by, the Collateral Agent or an agent thereof (which shall not be
the Company or any of its Affiliates) in the State of ___________ or (ii)
held by or on behalf of DTC ("Clearing Corporation") and credited to a
securities account of the Collateral Agent maintained with such Clearing
Corporation; or
(ii) maintained in book-entry form on the records of a Federal Reserve
Bank and registered in the name of the Collateral Agent, as depositary, in
a book-entry securities account maintained with respect to such Permitted
Investment with the Federal Reserve Bank in the Federal Reserve District in
which the Corporate Trust Office is located.
SECTION 11.02 INSTRUMENTS.
(a) The Company and, if applicable, any License Holding Subsidiary will
within the time period specified in Section 4.07(c), deliver and pledge to the
Collateral Agent [or its nominee] each Instrument acquired by it [or any of its
License Holding Subsidiaries] at any time as part of the noncash consideration
for any Permitted License Holding Subsidiary Transaction, appropriately endorsed
to the Collateral Agent, provided that the Collateral Agent may, upon request of
the Company, make appropriate arrangements for making any Instrument pledged by
the Company available to it for purposes of presentation, collection or renewal
(any such arrangement to be effected, to the extent deemed appropriate to the
Collateral Agent, against trust receipt or like document); subject, however, to
the Lien on such Instruments and the proceeds thereof. All Instruments required
under this subsection (a) to be delivered to the Collateral Agent shall be so
delivered by the Company pursuant hereto endorsed in suitable form for transfer
by endorsement and delivery by the Collateral Agent, and accompanied by any
required transfer tax stamps, all in form and substance reasonably satisfactory
to the Collateral Agent.
(b) Except as otherwise provided in this subsection (b), the Company shall
continue to enforce, at its own expense, any and all obligations of any Persons
to it arising out of Instruments received as noncash consideration and shall
continue to collect, at its own expense, all amounts due, if any, or to become
due, that arise out of such Instruments; provided, however, that the Collateral
Agent shall have the right at any time, and from time to time, upon the
occurrence and during the continuance of a Default, to direct the obligors to
the Company under such Instruments to make payment of all amounts or other
property due or to become due to the Company thereunder directly to the
Collateral Agent and, at the expense of the Company, to enforce such
Instruments, and to adjust, settle or compromise the amount or payment thereof,
if any, in the same manner and to the same extent as the Company might have
done. Upon the occurrence and during the continuance of a Default, all property
received by the Company in respect of such Instruments shall be received in
trust for the benefit of the Collateral Agent hereunder, shall be segregated
from other property of the Company and shall be forthwith delivered to the
Collateral Agent in the same form as so received (with any necessary endorsement
or assignment) to be held
69
as Collateral and either (i) released or disposed of according to Section 11.01,
so long as no Default shall be continuing, or (ii) if any Event of Default shall
have occurred and the Notes have been accelerated, applied as provided by
Section 6.02.
(c) Upon the occurrence and during the continuance of a Default, the
Company will promptly notify (and hereby authorizes the Trustee and the
Collateral Agent so to notify) each account debtor in respect of any Instrument
received as noncash consideration that such Collateral has been assigned to the
Collateral Agent hereunder, and that any payments due or to become due in
respect of such Collateral are to be made directly to the Collateral Agent or
its designee.
SECTION 11.03 PLEDGED SUBSIDIARY SHARES.
(a) The Company will, and as applicable, will cause its Restricted
Subsidiaries to, immediately deliver and pledge to the Collateral Agent
certificates acquired by it at any time representing License Holding Subsidiary
Shares. All certificates representing License Holding Subsidiary Shares listed
on Schedule ___ hereto or otherwise delivered to the Collateral Agent by the
Company pursuant hereto shall be accompanied by undated, duly executed stock
powers in blank, and accompanied by any required transfer tax stamps, all in
form and substance reasonably satisfactory to the Collateral Agent but subject
to the terms and conditions of the License Holding License Holding Subsidiary
Pledge Agreements.
(b) The Company will promptly give to the Collateral Agent copies of any
notices or other communications received by it with respect to License Holding
Subsidiary Shares registered in the name of the Company or any Subsidiary of the
Company and the Collateral Agent will promptly give to the Company copies of any
notices and communications received by the Collateral Agent with respect to
License Holding Subsidiary Shares registered in the name of the Collateral Agent
or its nominee.
(c) Unless a Default shall have occurred and be continuing and as provided
in the License Holding License Holding Subsidiary Pledge Agreements, the Company
shall have the right to receive any and all dividends permitted by Section 4.06
of this Indenture paid on the License Holding Subsidiary Shares other than any
dividends in the form of additional License Holding Subsidiary Shares, which
shall be immediately delivered and pledged to the Collateral Agent pursuant to
subsection (a); provided that until the Collateral Agent has received an
Officer's Certificate stating (i) the source, type and amount of such dividend
and (ii) that no Default has occurred and is continuing, any such cash dividend
(unless paid in the form of License Holding Subsidiary Shares) will be held by
the Company in trust for the benefit of the Collateral Agent and the Holders. If
a Default shall have occurred, the Company shall deposit any such cash dividends
with the Collateral Agent to be held as part of the Collateral.
(d) Unless and until (i) an Event of Default shall have occurred and be
continuing and (ii) written notice thereof shall have been given by the Trustee
to the Company, the Company shall have the right, from time to time, to vote and
give consents, ratifications and waivers with respect to the License Holding
Subsidiary Shares solely to the extent provided in the License Holding
Subsidiary Pledge Agreements. If an Event of Default shall have occurred, the
Collateral Agent shall have the right during the continuation of such Event of
Default, solely to the extent permitted by law and as provided in the License
Holding License Holding Subsidiary
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Pledge Agreements, and the Company shall take all such action as may be
necessary or appropriate to give effect to such right, to vote and to give
consents, ratifications or waivers and take any other action with respect to any
or all of the License Holding Subsidiary Shares with the same force and effect
as if the Collateral Agent were the sole and absolute owner thereof, including
without limitation, causing the registration thereof in the name of the
Collateral Agent. For purposes of subsection (a) of this Section 11.03, if the
License Holding Subsidiary Shares being pledged are the Capital Stock of a
Subsidiary organized under the laws of a jurisdiction other than the United
States, a State thereof or the District of Columbia, the Company shall (or shall
cause, as applicable, its Subsidiary to) execute and deliver to the Collateral
Agent a License Holding Subsidiary Pledge Agreement with respect thereto, which
shall be substantially in the form of Exhibit __ hereto, with such changes
therein (which shall be reasonably satisfactory to the Collateral Agent), as are
required by the law of the jurisdiction in which such subsidiary is organized in
order to grant a security interest in such Capital Stock comparable to that
provided for in Exhibit ____ hereto, as evidenced by an Opinion of Counsel
(which shall also address the validity of such agreement and the creation,
perfection and enforceability of such security interest).
SECTION 11.04 GENERAL AUTHORITY.
Each of the Company and the Trustee hereby irrevocably appoints the
Collateral Agent its true and lawful attorney (as provided in the License
Holding License Holding Subsidiary Pledge Agreements), with full power of
substitution, in the name of the Company, the Trustee, the Holders or otherwise,
for the sole use and benefit of the Trustee and the Holders, but at the
Company's expense, to the extent permitted by law to exercise, at any time and
from time to time while an Event of Default has occurred and is continuing, all
or any of the following powers with respect to all or any of the Collateral:
(i) to demand, xxx for, collect, receive and give acquittance for any
and all monies due or to become due thereon or by virtue thereof;
(ii) to settle, compromise, compound, prosecute or defend any action
or proceeding with respect thereto;
(iii) if the Notes have been declared, or have become, due and payable
and such declaration and its consequences have not been rescinded and
annulled, to sell, transfer, assign or otherwise deal in or with the same
or the proceeds or avails thereof, as fully and effectually as if the
Collateral Agent were the absolute owner thereof; and
(iv) to extend the time of payment of any or all thereof and to make
any allowance and other adjustments with reference thereto;
provided that the Collateral Agent shall give the Company not less than ten
days' prior written notice of the time and place of any sale or other intended
disposition of any of the Collateral. The Company agrees that such notice
constitutes "reasonable notification" within the meaning of Section 9-504(3) of
the Uniform Commercial Code.
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SECTION 11.05 LIMITATION ON DUTY OF TRUSTEE IN RESPECT OF COLLATERAL;
INDEMNIFICATION.
(a) Beyond the exercise of reasonable care in the custody thereof, the
Collateral Agent shall have no duty as to any Collateral in its possession or
control or in the possession or control of any agent or bailee or any income
thereon or as to the preservation of rights against prior parties or any other
rights pertaining thereto. The Collateral Agent shall be deemed to have
exercised reasonable care in the custody of the Collateral in its possession if
the Collateral is accorded treatment substantially equal to that which it
accords its own property, and shall not be liable or responsible for any loss or
diminution in the value of any of the Collateral, by reason of the act or
omission of any carrier, forwarding agency, or other agent or bailee selected by
the Collateral Agent in good faith.
(b) The Collateral Agent shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the validity, perfection,
priority or enforceability of the Liens in any of the Collateral, whether
impaired by operation of law or by reason of any action or omission to act on
its part hereunder. The Collateral Agent shall have no duty to ascertain or
inquire as to the performance or observance of any of the terms of this
Indenture by the Company.
(c) In the event that the Company fails to comply with the provisions of this
Indenture such that the value of any Collateral or the validity, perfection,
rank or value of any Lien is thereby diminished or potentially diminished or put
at risk, the Collateral Agent may, but shall not be required to, effect such
compliance on behalf of the Company, and the Company shall reimburse the
Collateral Agent for the costs thereof on demand. All expenses of protecting,
storing, insuring, handling and shipping the Collateral, any and all excise,
property, sales and use taxes imposed by any state, federal or local authority
on any of the Collateral, or expenses in respect of (i) the sale or other
disposition thereof, (ii) the administration or enforcement of this Indenture,
(iii) the exercise by the Collateral Agent of any of the rights conferred upon
it hereunder, including, without limitation, the preservation of the validity,
perfection, rank or value of any Lien or (iv) any Default or Event of Default,
shall be borne and paid by the Company; and if the Company fails to promptly pay
any portion of such expenses when due, the Collateral Agent may, at its option,
but shall not be required to, pay the same and charge the Company's account
therefor, and the Company agrees to reimburse the Collateral Agent therefor on
demand. All sums so paid or incurred by the Collateral Agent for any of the
foregoing and any and all other sums for which the Company may become liable
hereunder and all costs and expenses (including attorneys' fees, legal expenses
and court costs) reasonably incurred by the Collateral Agent in enforcing or
protecting the Liens or any of its rights or remedies under this Indenture,
shall, together with interest thereon until paid [at the rate applicable to the
Notes], be additional Secured Obligations hereunder.
SECTION 11.06 SECURITY DOCUMENTS; PRIORITY.
Each Holder, by its acceptance of a Note, (i) consents and agrees to all of
the terms and conditions of the Security Documents and authorizes and directs
the Trustee and the Collateral Agent to enter into each of the Security
Documents and to perform its respective obligations and exercise its respective
rights thereunder in accordance therewith; provided, however, that if any
provision of the Security Documents limits, qualifies, or conflicts with the
duties imposed by the provisions of the TIA, the TIA controls, and (ii)
acknowledges that, as more fully set forth in the
72
Collateral Agency Agreement and the License Holding Subsidiary Pledge Agreement,
the rights of the Holders in and to the Collateral shall be subordinate to the
rights of the creditors under any Senior Indebtedness existing from time to time
hereafter to the Collateral.
SECTION 11.07 CERTIFICATES OF THE COMPANY.
The Company will furnish to [the Trustee and the Collateral Agent] prior to
each proposed release of Collateral pursuant to this Indenture or any other
Security Document, (i) all documents required by Section 314(d) of the TIA, if
any, (ii) an Officers' Certificate requesting a release of Collateral and
describing the property to be so released and (iii) an Opinion of Counsel to the
effect that such accompanying documents constitute all documents required by
Section 314(d) of the TIA.
SECTION 11.08 MISCELLANEOUS.
(a) The Liens are granted as security only and not a transfer of title and
shall not subject the Collateral Agent, Trustee or any Holder to, or transfer or
in any way affect or modify, any obligation or liability of the Company or any
Subsidiary of the Company with respect to any of the Collateral or any
transaction in connection therewith.
(b) The Company will not effect any Permitted License Holding Subsidiary
Transaction with respect to any Collateral except as permitted under Section
4.07 of this Indenture.
(c) The Trustee and the Collateral Agent shall take, or cause to be taken,
any action reasonably requested by the Company to release any and all Liens in
connection with a Permitted License Holding Subsidiary Transaction in accordance
with the terms and conditions of the Security Documents.
(d) The Company will, promptly upon request, provide to the Trustee all
information and evidence it may reasonably request concerning the Collateral and
any other information the Trustee may reasonably request to enable the Trustee
to enforce the provisions of this Indenture.
(e) The Company shall comply, in all material respects, with all acts,
rules, regulations, orders, decrees and directions of any court or governmental
instrumentality applicable to the Collateral.
(f) The Company will deliver to the Collateral Agent a copy of each
material demand, notice or document received by it relating in any way to the
Collateral if failure to so deliver might adversely affect the Collateral
Agent's ability to safeguard the Lien on such Collateral.
ARTICLE 12
NOTE GUARANTEES
SECTION 12.01 GUARANTEE.
Subject to this Article 12, the Guarantors hereby unconditionally guarantee
to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee (a) the full and punctual payment of principal of and interest on the
then outstanding Notes when due (taking into
73
account all applicable grace periods provided hereunder), whether at maturity,
by acceleration, by redemption or otherwise, and all other amounts payable by
the Company under this Indenture and the Notes, and (b) the full and punctual
performance of all other obligations of the Company under this Indenture and the
Notes (all the foregoing described in (a) and (b) being hereafter collectively
called the "Guarantee Obligations"). The Guarantors further agree that the
Guarantee Obligations may be extended or renewed, in whole or in part, without
notice or further assent from each of the Guarantors, and that the Guarantors
will remain bound under this Article 12 notwithstanding any extension or renewal
of any Guarantee Obligation.
Each Guarantor further agrees that the Guarantee herein constitutes a
guarantee of payment, performance and compliance when due (and not a guarantee
of collection) and waives any right to require that any resort be had by any
Holder, the Trustee or the Collateral Agent to any security held for payment of
the Guarantee Obligations.
The Guarantors waive presentation to, demand of payment from and protect to
the Company of any of the Guarantee Obligations and also waive notice of any
default under the Obligations not provided for herein. The obligations of the
Guarantors hereunder, subject to Article 8, shall not be subject to any
reduction, limitation, impairment or termination for any reason, including any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense of setoff, counterclaim, recoupment or termination
whatsoever or by reason of the invalidity, illegality or unenforceability of the
Guarantee Obligations or otherwise.
Without limiting the generality of the foregoing, except as provided in
Article 8, the obligations of the Guarantors hereunder shall not be discharged
or impaired or otherwise affected by (a) the failure of any Holder or the
Trustee to assert any claim or demand or to enforce any right or remedy against
the Company or any other person under this Indenture and the Notes; (b) any
extension or renewal of any thereof; (c) any rescission, waiver, amendment or
modification of any of the terms or provisions of this Indenture and the Notes
(except as to the Guarantees or this Article 12); (d) the release of any
security held by any Holder, the Trustee or the Collateral Agent for the
Guarantee Obligations or any of them; (e) the failure of any Holder or Trustee
to exercise any right or remedy against any other guarantor of the Guarantee
Obligations; (f) any change in the ownership of the Guarantors; (g) any default,
failure of delay, willful or otherwise, in the performance of the Guarantee
Obligations; or (h) by any other act or thing or omission or delay to do any
other act or thing which may or might in any manner or to any extent vary the
risk of the Guarantors or would otherwise operate as a discharge of the
Guarantors as a matter of law or equity.
The Guarantors further agree that if at any time payment, or any part
thereof, of principal of or interest on any Guarantee Obligation is rescinded or
must otherwise be restored by any Holder or the Trustee upon the bankruptcy or
reorganization of the Company and or the Restricted Subsidiaries or otherwise,
its Guarantees herein as to each such amount shall continue to be effective or
be reinstated, as the case may be.
In furtherance of the foregoing and not in limitation of any other right
which any Holder or the Trustee has at law or in equity against the Guarantors
by virtue hereof, upon the failure of the Company and or the Restricted
Subsidiaries to pay the principal of or interest on any Guarantee Obligation
when and as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, or to perform or comply with any other Guarantee
74
Obligation (in each case taking into account all applicable grace periods
provided hereunder), the Guarantors hereby promise to and will, upon receipt of
written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to
the Holders or the Trustee such amount not so paid.
Notwithstanding any provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment of monies to or by the Trustee, or the taking of any other
action by the Trustee, until three Business Days after a trust officer of the
Trustee shall have actually received written notice thereof from the Company,
the Guarantors, any Holder of the Notes, any Paying Agent or any bank.
The Guarantors agree that they shall not be entitled to any right of
subrogation in relation to the Holders in respect of any Guarantee Obligations
guaranteed hereby. The Guarantors further agree that, as between the Guarantors,
on the one hand, and the Holders and the Trustee, on the other hand, (a) the
maturity of the Guarantee Obligations guaranteed hereby may be accelerated as
provided in Article 6 for the purposes of the Guarantors' Guarantees herein, and
(b) in the event of any declaration of acceleration of such Guarantee
Obligations as provided in Article 6 and if the Guarantee Obligations thereby
become due and payable, such Guarantee Obligations shall forthwith become due
and payable by the Guarantors for the purpose of this Section.
SECTION 12.02 NO WAIVER, ETC.
Neither a failure nor a delay on the part of either the Trustee or the
Holders in exercising any right, power or privilege under this Article 12 shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any right, power or privilege. The
rights, remedies and benefits of the Trustee and the Holders herein expressly
specified are cumulative and not exclusive of any other rights, remedies or
benefits which either may have under this Article 12 at law, in equity, by
statute or otherwise.
SECTION 12.03 SUBORDINATION OF NOTE GUARANTEES.
Each Guarantor agrees, and each Holder by accepting a Note agrees, that the
Guarantee Obligations of the Guarantors pursuant to this Article 12 shall be
junior and subordinated to the rights of any Senior Indebtedness of the Company
or any Guarantor existing from time to time hereafter in the Collateral on the
same basis as the Notes are junior and subordinated to the rights of any Senior
Indebtedness as provided in Articles 10 and 11 hereof and in the Collateral
Agency Agreement. For the purposes of the foregoing sentence, the Trustee and
the Holders shall have the right to receive and/or retain payments by any such
Guarantor only at such times as they may receive and/or retain payments in
respect of the Notes pursuant to this Indenture.
SECTION 12.04 LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor and, by its acceptance of the Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Guarantee
Obligations not constitute a fraudulent transfer or conveyance for purposes of
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state laws to the extent applicable to
the Guarantee Obligations. To effectuate the foregoing intention, the Trustee,
the Holders and each of the Guarantors hereby irrevocably agree that the
obligations of each of the
75
Guarantors under the Guarantee Obligations and this Article 12 shall be limited
to the maximum amounts as will, after giving effect to such maximum amount and
all other contingent and fixed liabilities of the Guarantors that are relevant
under such laws, result in the obligations of the Guarantors under the Guarantee
Obligations not constituting a fraudulent transfer or conveyance.
SECTION 12.05 EXECUTION AND DELIVERY OF NOTE GUARANTEES.
To evidence the Guarantee Obligations set forth in Section 12.01, each
Guarantor hereby agrees that this Indenture shall be executed on its behalf by
the president or one of its vice presidents.
If an officer whose signature is on this Indenture no longer holds that
office at the time the Trustee authenticates the Notes, the Guarantee
Obligations shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Guarantee Obligations set forth
in this Indenture on behalf of the Guarantor.
SECTION 12.06 RELEASES FOLLOWING SALE FOR ASSETS.
In the event a Guarantor sells or otherwise disposes of all of its License
Holding Subsidiary Shares by way of merger, consolidation or otherwise, then
such Guarantor in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of its License Holding Subsidiary Shares
shall be released and relieved of any obligations under the Guarantee
Obligations; provided that the Net Proceeds of such sale or other disposition
are applied in accordance with the applicable provisions of this Indenture,
including, without limitation, Section 4.07 hereof. Upon delivery by the Company
to the Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale or other disposition was made by the Company in accordance
with the applicable provisions of this Indenture, the Trustee shall execute any
documents reasonably required in order to evidence the release of the Guarantor
from its obligations under the Guarantee Obligations.
SECTION 12.07 NO PERSONAL LIABILITY OF PARTNERS, STOCKHOLDERS, OFFICERS OR
DIRECTORS.
No direct or indirect stockholder, partner, employee, officer or director,
as such, past, present or future of any Guarantor or any successor entity shall
have any personal liability in respect of the obligations of any Guarantor or
any successor entity under this Agreement by reason of his or its status as such
stockholder, partner, employee, officer or director.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss. 318(c), the imposed duties shall control.
76
SECTION 13.02 NOTICES.
Any notice or communication by the Company or the Trustee to the others is
duly given if in writing and delivered in Person or mailed by first class mail
(registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address.
If to the Company or to the Guarantors:
NextWave Telecom Inc.
0 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
With a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
If to the Trustee:
[Name]
[Address]
Telecopier No.: __________
Attention: [Corporate Trust Administration]
With a copy to:
[Name]
[Address]
Telecopier No.: ______________
Attention: _______________, Esq.
[If to the Collateral Agent:
[Name]
[Address]
Telecopier No.: __________
Attention: _______________, Esq.]
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
77
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA ss. 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders. If a notice or
communication is mailed in the manner provided above within the time prescribed,
it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
SECTION 13.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
SECTION 13.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 13.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee (which shall include the statements set forth in Section 13.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
SECTION 13.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA ss.
314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has read
such covenant or condition;
78
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
SECTION 13.06 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 13.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No member, director, officer, employee, incorporator or stockholder of the
Company, as such, shall have any liability for any obligations of the Company
under the Notes or this Indenture or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and release
are part of the consideration for issuance of the Notes.
SECTION 13.08 GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 13.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 13.10 SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 13.11 SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
79
SECTION 13.12 COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
SECTION 13.13 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
80
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the date first written above.
NEXTWAVE TELECOM INC., as Issuer
By: _________________________________________________
Name: ____________________________________________
Title: __________________________________________
NEXTWAVE PERSONAL COMMUNICATIONS INC., as Guarantor
By: _________________________________________________
Name: ____________________________________________
Title:___________________________________________
NEXTWAVE POWER PARTNERS INC., as
Guarantor
By: _________________________________________________
Name: ____________________________________________
Title:___________________________________________
[NAME OF TRUSTEE]
By: _________________________________________________
Name: ____________________________________________
Title: __________________________________________
[[NAME OF COLLATERAL AGENT]
By: _________________________________________________
Name: ____________________________________________
Title: _________________________________________]
81
EXHIBIT A
(Face of Global or Definitive Note)
================================================================================
CUSIP ____________
12% Senior Secured Subordinated Notes due 2009
No. _____ $___________
NEXTWAVE TELECOM INC.
promises to pay to _______________, or registered assigns, the principal sum of
___________ Dollars on _____________, 2009.
Interest Payment Dates: __________ and __________
Record Dates: __________ and __________
[Insert the Global Note Legend, if applicable, pursuant to Section 2.06(f) of
the Indenture]
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Dated:
NEXTWAVE TELECOM INC.
By: _________________________________
Name: _________________________
Title: ________________________
This is one of the Notes referred to
in the within-mentioned Indenture:
[NAME],
as Trustee
By: _________________________________
Name: _________________________
Title: ________________________
================================================================================
A-F-1
(Back of Note)
12% Senior Secured Subordinated Notes due 2009
Capitalized terms used herein shall have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
1. Security Interest. The Notes are secured by the Collateral subject to
the Lien of the Security Documents and subject to the terms and the conditions
of the Collateral Agency Agreement.
2. Interest. NextWave Telecom Inc., a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Note at 12% per annum
from __________, 1999 until maturity. The Company will pay interest
semi-annually on __________ and __________ of each year, or if any such day is
not a Business Day, on the next succeeding Business Day (each, an "Interest
Payment Date"). Interest on the Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; and provided further
that the first Interest Payment Date shall be _____________. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
On each Interest Payment Date, the Company shall, in lieu of a payment in
cash, execute and deliver to the Trustee for authentication, together with an
Authentication Order given not less than 15 nor more than 45 days prior to such
Interest Payment Date for the authentication and delivery thereof, additional
Notes ("Secondary Notes") in an aggregate principal amount equal to such
interest due and payable on the Notes on such Interest Payment Date in
accordance with Section 2.01(b) of the Indenture. The Trustee, in accordance
with such Authentication Order, shall so authenticate and deliver to the Holders
of record on such record date such Secondary Notes requested in such
Authentication Order (such duly executed and authenticated Secondary Notes being
of the same series as the Notes), and the due issuance of such Secondary Notes
shall constitute full payment of such interest; provided, however, the Company
may, at its option, duly authorize the payment in cash of all or a portion of
any interest due on any such Interest Payment Date, in lieu of a payment in
Secondary Notes, by giving notice to the Holders and the Trustee not less than
15 nor more than 45 days prior to the record date for such Interest Payment
Date; provided further, however, that in lieu of the issuance of any Secondary
Note the principal amount of which (x) would be less than $1,000 or (y) would
exceed the largest integral multiple of $1,000 which is less than or equal to
such principal amount (in each case, a "Fractional Secondary Note"), the Company
shall, in the case of clause (y), issue a Secondary Note with a principal amount
equal to such largest integral multiple and shall, in the case of clauses (x)
and (y), in its sole discretion, either (1) on behalf of and for the accounts of
all Holders of Notes who would be entitled to Fractional Secondary Notes,
aggregate all such Fractional Secondary Notes and, on or before the tenth
Business Day following the applicable Interest Payment Date, sell such
aggregated Fractional Secondary Notes and, within six Business Days of such
sale, pay each such Holder its proportionate share of the net proceeds of such
sale, or (2) pay (on the Interest Payment Date) each such Holder, with respect
to any Fractional Secondary Note that such Holder would otherwise be entitled to
receive, an amount in cash equal to the average closing price per $1,000
principal amount of Notes for the ten trading days preceding the Business Day
immediately preceding the applicable Interest Payment Date multiplied by a
fraction, the numerator of which is the principal amount of such Fractional
Secondary Note otherwise issuable to such Holder and the denominator of which is
$1,000. Each issuance of Secondary Notes in lieu of the payment of all or any
portion of interest in cash on the Notes shall be made pro rata with respect to
the outstanding Notes.
3. Method of Payment. The Company will pay interest on the Notes (except
defaulted interest) to the Persons who are registered Holders of Notes at the
close of business on the __________ or __________ next preceding the Interest
Payment Date, even if such Notes are cancelled after such record
A-R-1
date and on or before such Interest Payment Date, except as provided in Section
2.12 of the Indenture with respect to defaulted interest. The Notes will be
payable as to principal, premium, if any, and interest at the office of the
Paying Agent and Registrar. Holders of Notes must surrender their Notes to the
Paying Agent to collect principal payments, and the Company may pay principal
and interest, if any, by check and may mail checks to a Holder's registered
address; provided that all payments with respect to Global Notes will be paid by
wire transfer of immediately available funds to the account of the Depositary.
Such payment shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
4. Paying Agent and Registrar. Initially, _____________________, the
Trustee under the Indenture, will act as Paying Agent and Registrar. The Company
may change any Paying Agent or Registrar without notice to any Holder. The
Company or any of its Subsidiaries may act in any such capacity.
5. Indenture. The Company issued the Notes under an Indenture dated as of
________, 1999 ("Indenture"), between the Company and the Trustee. The terms of
the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.
Code xx.xx. 77aaa-77bbbb). The Notes are subject to all such terms, and Holders
are referred to the Indenture and such Act for a statement of such terms. To the
extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling. The
Notes are obligations of the Company limited in aggregate principal amount to
$225,000,000 plus the aggregate principal amount of any Secondary Notes issued
pursuant to Section 2.02 of the Indenture.
6. Optional Redemption.
(a) The Company may redeem the Notes, in whole or in part, at any time at
the option of the Company, upon not less than 30 nor more than 60 days' notice,
in cash at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period (or, with
respect to years (i) 1999, such shorter period beginning on the Original
Issuance Date, and (ii) 2009, such shorter period ending on the Maturity Date)
beginning on April 1 of the years indicated below:
Year Percentage
---- ----------
1999............................................... 100.000%
2000............................................... 100.000%
2001............................................... 102.000%
2002............................................... 103.000%
2003............................................... 104.000%
2004............................................... 105.000%
2005............................................... 104.000%
2006............................................... 103.000%
2007............................................... 102.000%
2008............................................... 101.000%
2009............................................... 100.000%
(b) Any redemption pursuant to this subparagraph 6 shall be made pursuant
to the provisions of Section 3.01 through 3.06 of the Indenture.
7. Notice of Redemption. Notice of redemption will be mailed by first class
mail at least 30 days but not more than 60 days before the redemption date to
each Holder of Notes to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
A-R-2
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on Notes or
portions thereof called for redemption.
8. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Company may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Note may be treated as
its owner for all purposes.
10. Amendment, Supplement and 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 principal amount of the then outstanding Notes
and any existing Default or compliance with any provision of the Indenture or
the Notes may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes. Without the consent of any
Holder of a Note, the Indenture or the Notes may be amended or supplemented to
cure any ambiguity, defect or inconsistency, to provide for uncertificated Notes
in addition to or in place of certificated Notes in a manner that does not
materially adversely affect any Holder, to provide for the assumption of the
Company's obligations to Holders of the Notes by a successor to the Company in
case of a merger or consolidation, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights under the Indenture of any such Holder, to
comply with the requirements of the Commission in order to effect or maintain
the qualification of the Indenture under the Trust Indenture Act, or to provide
for guarantees of the Notes.
11. Defaults and Remedies. Each of the following constitutes an "Event of
Default": (a) default for 30 days in the payment when due of interest on the
Notes (whether or not prohibited by Article 10 of the Indenture); (b) default in
payment when due of the principal of or premium, if any, on the Notes (whether
or not prohibited by Article 10 of the Indenture); (c) failure by the Company
for 60 days after notice from the Trustee or the Holders of at least 33-1/3% in
principal amount of the Notes then outstanding to comply with any of its other
agreements in the Indenture or the Notes; (d) default under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company or any
of its Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries), whether such Indebtedness or
guarantee now exists, or is created after the Original Issuance Date, which
default results in the acceleration of such Indebtedness prior to its stated
final maturity and the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness the maturity of which has
been so accelerated, aggregates $50.0 million or more; (e) failure by the
Company or any of its Restricted Subsidiaries to pay final judgments aggregating
in excess of $50.0 million (net of any amounts with respect to which a reputable
and creditworthy insurance company has acknowledged liability in writing), which
judgments are not paid, discharged or stayed for a period of 60 days; and (f)
certain events of bankruptcy or insolvency as described in the Indenture.
If any Event of Default (other than certain events of bankruptcy or
insolvency) occurs and is continuing, the Holders of at least 25% in principal
amount of the then outstanding Notes may, only on the terms and subject to the
conditions set forth in the Collateral Agency Agreement, direct the Trustee to
declare all the Notes to be due and payable immediately. Upon any such
declaration, the Notes shall become due and payable immediately, provided, that
so long as any Senior Indebtedness shall be
A-R-3
outstanding, such acceleration shall not be effective until five Business Days
after receipt by the Company and the lender under any Senior Indebtedness of
written notice of such acceleration. Notwithstanding the foregoing, in the case
of an Event of Default arising from certain events of bankruptcy or insolvency,
all outstanding Notes shall be due and payable immediately without further
action or notice. The Holders of a majority in aggregate principal amount of the
then outstanding Notes by written notice to the Trustee may on behalf of all of
the Holders rescind an acceleration and its consequences if the rescission would
not conflict with any judgment or decree and if all existing Events of Default
(except nonpayment of principal, interest or premium, if any, that has become
due solely because of the acceleration) have been cured or waived. The Company
is required to deliver to the Trustee annually a statement regarding compliance
with the Indenture, and the Company is required upon becoming aware of any
Default or Event of Default to deliver to the Trustee a statement specifying
such Default or Event of Default.
12. Subordination. The payment of Subordinated Note Obligations will be
subordinated in right of payment, as set forth in the Indenture, to the prior
payment in full in cash or cash equivalents of all Senior Indebtedness, whether
outstanding on the Original Issuance Date or thereafter incurred. The Company
agrees, and each Holder by accepting a Note agrees, that the payment of
principal of, premium and interest, if any, on the Notes is subordinated in
right of payment, to the extent and in the manner provided in the Indenture, to
the prior payment in full in cash or cash equivalents of all Senior Indebtedness
(whether outstanding on the date hereof or thereafter created, incurred, assumed
or guaranteed), and that the subordination is for the benefit of the holders of
Senior Indebtedness.
13. Defeasance. The Indenture contains provisions for defeasance at any
time of (i) the entire indebtedness of the Notes or (ii) certain restrictive
covenants and Events of Default with respect to the Notes, in each case upon
compliance with certain conditions set forth therein.
14. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if it were not the Trustee.
15. No Recourse Against Others. No member, director, officer, employee or
incorporator of the Company, as such, shall have any liability for any
obligations of the Company under the Notes or the Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the Notes.
16. Authentication. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
17. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
18. 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-R-4
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
NEXTWAVE TELECOM INC.
0 Xxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
A-R-5
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint to transfer this Note on the books of the Company. The
agent may substitute another to act for him.
Date: Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No:__________________________
Signature Guarantee.
A-R-6
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or a Definitive Note for an interest in this Global Note, have been
made:
Principal Amount of this Signature of
Amount of decrease in Amount of increase in Global Note following authorized officer
Principal Amount Principal Amount of such decrease (or of Trustee or Note
Date of Exchange of this Global Note this Global Note increase) Custodian
---------------- ------------------- ---------------- --------- ---------
A-R-7
CROSS-REFERENCE TABLE*
Trust Indenture Act Section Indenture Section
310 (a)(1).................................................................................7.10
(a)(2) ................................................................................7.10
(a)(3).................................................................................N.A.
(a)(4).................................................................................N.A.
(a)(5).................................................................................7.10
(b)....................................................................................7.10
(c)....................................................................................N.A.
311 (a)....................................................................................7.11
(b)....................................................................................7.11
(c)....................................................................................N.A.
312 (a)....................................................................................2.05
(b)...................................................................................13.03
(c)...................................................................................13.03
313 (a)....................................................................................7.06
(b)....................................................................................7.06
(b)(1).................................................................................N.A.
(b)(2)...........................................................................7.06; 7.07
(c)...................................................................................13.02
(d)....................................................................................7.06
314 (a).............................................................................4.03; 13.05
(b)....................................................................................N.A.
(c)(1)................................................................................13.04
(c)(2)................................................................................13.04
(c)(3).................................................................................N.A.
(d)....................................................................................N.A.
(e)...................................................................................11.05
(f)....................................................................................N.A.
315 (a)....................................................................................7.01
(b)....................................................................................7.05
(c)....................................................................................7.01
(d)....................................................................................7.01
(e)....................................................................................6.11
316 (a)(last sentence).....................................................................2.09
(a)(1)(A)..............................................................................6.05
(a)(1)(B)..............................................................................6.04
(a)(2).................................................................................N.A.
(b)....................................................................................6.07
(c)....................................................................................2.12
317 (a)(1).................................................................................6.08
(a)(2).................................................................................6.09
(b)....................................................................................2.04
318 (a)...................................................................................13.01
(b)....................................................................................N.A.
(c)...................................................................................13.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE...................................................2
SECTION 1.01 DEFINITIONS ......................................................................2
SECTION 1.02 OTHER DEFINITIONS................................................................18
SECTION 1.03 INCORPORATION OF TIA PROVISIONS..................................................19
SECTION 1.04 RULES OF CONSTRUCTION............................................................19
ARTICLE 2 THE NOTES ..................................................................................20
SECTION 2.01 FORM AND DATING..................................................................20
SECTION 2.02 EXECUTION AND AUTHENTICATION.....................................................21
SECTION 2.03 REGISTRAR AND PAYING AGENT.......................................................23
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST..............................................23
SECTION 2.05 HOLDER LISTS ....................................................................23
SECTION 2.06 TRANSFER AND EXCHANGE............................................................24
SECTION 2.07 REPLACEMENT NOTES................................................................28
SECTION 2.08 OUTSTANDING NOTES................................................................28
SECTION 2.09 TREASURY NOTES...................................................................28
SECTION 2.10 TEMPORARY NOTES..................................................................29
SECTION 2.11 CANCELLATION ....................................................................29
SECTION 2.12 DEFAULTED INTEREST...............................................................29
SECTION 2.13 SATISFACTION AND DISCHARGE OF INDENTURE..........................................29
ARTICLE 3 REDEMPTION AND PREPAYMENT...................................................................31
SECTION 3.01 NOTICES TO TRUSTEE...............................................................31
SECTION 3.02 SELECTION OF NOTES TO BE REDEEMED................................................31
SECTION 3.03 NOTICE OF REDEMPTION.............................................................31
SECTION 3.04 EFFECT OF NOTICE OF REDEMPTION...................................................32
SECTION 3.05 DEPOSIT OF REDEMPTION PRICE......................................................32
SECTION 3.06 NOTES REDEEMED IN PART...........................................................33
SECTION 3.07 OPTIONAL REDEMPTION..............................................................33
SECTION 3.08 MANDATORY REDEMPTION.............................................................33
ARTICLE 4 COVENANTS ..................................................................................34
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SECTION 4.01 PAYMENT OF NOTES.................................................................34
SECTION 4.02 MAINTENANCE OF OFFICE OR AGENCY..................................................34
SECTION 4.03 REPORTS .........................................................................34
SECTION 4.04 COMPLIANCE CERTIFICATE...........................................................35
SECTION 4.05 STAY, EXTENSION AND USURY LAWS...................................................35
SECTION 4.06 RESTRICTED PAYMENTS..............................................................36
SECTION 4.07 ASSET SALES .....................................................................39
SECTION 4.08 TRANSACTIONS WITH AFFILIATES.....................................................41
SECTION 4.09 LIENS ...........................................................................42
SECTION 4.10 CORPORATE EXISTENCE..............................................................42
SECTION 4.11 NO SENIOR SUBORDINATED INDEBTEDNESS..............................................43
SECTION 4.12 PAYMENTS FOR CONSENT.............................................................43
SECTION 4.13 ESTABLISHMENT OF SUBSIDIARIES....................................................43
SECTION 4.14 ISSUANCE OF SUBSIDIARY CAPITAL STOCK.............................................43
SECTION 4.15 [OFFER TO REPURCHASE UPON CHANGE OF CONTROL......................................44
SECTION 4.16 GUARANTEES BY LICENSE HOLDING SUBSIDIARIES.......................................45
SECTION 4.17 CONSUMMATION OF PLAN OF REORGANIZATION...........................................45
ARTICLE 5 SUCCESSORS .................................................................................45
SECTION 5.01 MERGER, CONSOLIDATION, OR SALE OF ASSETS.........................................45
SECTION 5.02 SUCCESSOR CORPORATION SUBSTITUTED................................................46
ARTICLE 6 DEFAULTS AND REMEDIES.......................................................................46
SECTION 6.01 EVENTS OF DEFAULT................................................................46
SECTION 6.02 ACCELERATION ....................................................................47
SECTION 6.03 OTHER REMEDIES...................................................................48
SECTION 6.04 WAIVER OF PAST DEFAULTS..........................................................48
SECTION 6.05 CONTROL BY MAJORITY..............................................................48
SECTION 6.06 LIMITATION ON SUITS..............................................................49
SECTION 6.07 RIGHTS OF HOLDERS OF NOTES TO RECEIVE PAYMENT....................................49
SECTION 6.08 COLLECTION SUIT BY TRUSTEE.......................................................49
SECTION 6.09 TRUSTEE MAY FILE PROOFS OF CLAIM.................................................49
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(continued)
Page
SECTION 6.10 PRIORITIES ......................................................................50
SECTION 6.11 UNDERTAKING FOR COSTS............................................................50
ARTICLE 7 TRUSTEE ....................................................................................51
SECTION 7.01 DUTIES OF TRUSTEE................................................................51
SECTION 7.02 RIGHTS OF TRUSTEE................................................................52
SECTION 7.03 INDIVIDUAL RIGHTS OF TRUSTEE.....................................................53
SECTION 7.04 TRUSTEE'S DISCLAIMER.............................................................53
SECTION 7.05 NOTICE OF DEFAULTS...............................................................53
SECTION 7.06 REPORTS BY TRUSTEE TO HOLDERS OF THE NOTES ......................................53
SECTION 7.07 COMPENSATION AND INDEMNITY.......................................................54
SECTION 7.08 REPLACEMENT OF TRUSTEE...........................................................55
SECTION 7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.................................................56
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION....................................................56
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY................................56
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE....................................................56
SECTION 8.01 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.........................56
SECTION 8.02 LEGAL DEFEASANCE AND DISCHARGE...................................................56
SECTION 8.03 COVENANT DEFEASANCE..............................................................57
SECTION 8.04 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.......................................57
SECTION 8.05 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD
IN TRUST; OTHER MISCELLANEOUS PROVISIONS ........................................59
SECTION 8.06 REPAYMENT TO COMPANY.............................................................59
SECTION 8.07 REINSTATEMENT....................................................................59
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER............................................................60
SECTION 9.01 WITHOUT CONSENT OF HOLDERS OF NOTES..............................................60
SECTION 9.02 WITH CONSENT OF HOLDERS OF NOTES.................................................61
SECTION 9.03 COMPLIANCE WITH TRUST INDENTURE ACT..............................................62
SECTION 9.04 REVOCATION AND EFFECT OF CONSENTS................................................62
iii
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(continued)
Page
SECTION 9.05 NOTATION ON OR EXCHANGE OF NOTES.................................................63
SECTION 9.06 TRUSTEE TO SIGN AMENDMENTS, ETC..................................................63
ARTICLE 10 SUBORDINATION..............................................................................63
SECTION 10.01 AGREEMENT TO SUBORDINATE AND PRIORITY..........................................63
SECTION 10.02 LIQUIDATION; DISSOLUTION; BANKRUPTCY...........................................64
SECTION 10.03 DEFAULT ON ANY SENIOR INDEBTEDNESS.............................................64
SECTION 10.04 ACCELERATION OF SECURITIES.....................................................65
SECTION 10.05 WHEN DISTRIBUTION MUST BE PAID OVER............................................65
SECTION 10.06 NOTICE BY COMPANY..............................................................65
SECTION 10.07 SUBROGATION ...................................................................65
SECTION 10.08 RELATIVE RIGHTS................................................................66
SECTION 10.09 SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY...................................66
SECTION 10.10 DISTRIBUTION OR NOTICE TO REPRESENTATIVE.......................................66
SECTION 10.11 RIGHTS OF TRUSTEE AND PAYING AGENT.............................................66
SECTION 10.12 AUTHORIZATION TO EFFECT SUBORDINATION..........................................67
SECTION 10.13 NO WAIVER OF SUBORDINATION PROVISIONS..........................................67
SECTION 10.14 AMENDMENTS ....................................................................67
SECTION 10.15 TRUSTEE'S COMPENSATION NOT PREJUDICED..........................................67
ARTICLE 11 COLLATERAL AND SECURITY....................................................................68
SECTION 11.01 CASH COLLATERAL ACCOUNT........................................................68
SECTION 11.02 INSTRUMENTS ...................................................................69
SECTION 11.03 PLEDGED SUBSIDIARY SHARES......................................................70
SECTION 11.04 GENERAL AUTHORITY..............................................................71
SECTION 11.05 LIMITATION ON DUTY OF TRUSTEE IN RESPECT OF COLLATERAL; INDEMNIFICATION........72
SECTION 11.06 SECURITY DOCUMENTS; PRIORITY...................................................72
SECTION 11.07 CERTIFICATES OF THE COMPANY....................................................73
SECTION 11.08 MISCELLANEOUS..................................................................73
ARTICLE 12 [NOTE GUARANTEES...........................................................................73
SECTION 12.01 GUARANTEE .....................................................................73
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(continued)
Page
SECTION 12.02 NO WAIVER, ETC.................................................................75
SECTION 12.03 SUBORDINATION OF NOTE GUARANTEES...............................................75
SECTION 12.04 LIMITATION ON GUARANTOR LIABILITY..............................................75
SECTION 12.05 EXECUTION AND DELIVERY OF NOTE GUARANTEES......................................76
SECTION 12.06 RELEASES FOLLOWING SALE FOR ASSETS.............................................76
SECTION 12.07 NO PERSONAL LIABILITY OF PARTNERS, STOCKHOLDERS, OFFICERS OR DIRECTORS.........76
ARTICLE 13 MISCELLANEOUS..............................................................................76
SECTION 13.01 TRUST INDENTURE ACT CONTROLS...................................................76
SECTION 13.02 NOTICES .......................................................................77
SECTION 13.03 COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES..................78
SECTION 13.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.............................78
SECTION 13.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION..................................78
SECTION 13.06 RULES BY TRUSTEE AND AGENTS....................................................79
SECTION 13.07 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS.......79
SECTION 13.08 GOVERNING LAW..................................................................79
SECTION 13.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS..................................79
SECTION 13.10 SUCCESSORS ....................................................................79
SECTION 13.11 SEVERABILITY ..................................................................80
SECTION 13.12 COUNTERPART ORIGINALS..........................................................80
SECTION 13.13 TABLE OF CONTENTS, HEADINGS, ETC...............................................80
v
