Exhibit 4.1
PRIME HOSPITALITY CORP.
8 3/8% Senior Subordinated Notes due 2012
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INDENTURE
Dated as of April 29, 2002
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Xxxxx Fargo Bank Minnesota, NA
Trustee
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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).................................................................... 12.03
(c).................................................................... 12.03
313(a)...................................................................... 7.06
(b)(1)................................................................. N.A.
(b)(2)................................................................. 7.06; 7.07
(c).................................................................... 7.06; 12.02
(d).................................................................... 7.06
314(a)...................................................................... 4.03;12.02; 12.05
(b).................................................................... N.A.
(c)(1)................................................................. 12.04
(c)(2)................................................................. 12.04
(c)(3)................................................................. N.A.
(d).................................................................... N.A.
(e).................................................................... 12.05
(f).................................................................... N.A.
315(a)...................................................................... 7.01
(b).................................................................... 7.05,12.02
(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)...................................................................... 12.01
(b).................................................................... N.A.
(c).................................................................... 12.01
N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.................................................................................1
Section 1.02 Other Definitions..........................................................................18
Section 1.03 Incorporation by Reference of Trust Indenture Act..........................................19
Section 1.04 Rules of Construction......................................................................19
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating............................................................................19
Section 2.02 Execution and Authentication...............................................................20
Section 2.03 Registrar and Paying Agent.................................................................20
Section 2.04 Paying Agent to Hold Money in Trust........................................................21
Section 2.05 Holder Lists...............................................................................21
Section 2.06 Transfer and Exchange......................................................................21
Section 2.07 Replacement Notes..........................................................................33
Section 2.08 Outstanding Notes..........................................................................33
Section 2.09 Treasury Notes.............................................................................33
Section 2.10 Temporary Notes............................................................................33
Section 2.11 Cancellation...............................................................................34
Section 2.12 Defaulted Interest.........................................................................34
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.........................................................................34
Section 3.02 Selection of Notes to Be Redeemed or Purchased.............................................34
Section 3.03 Notice of Redemption.......................................................................35
Section 3.04 Effect of Notice of Redemption.............................................................36
Section 3.05 Deposit of Redemption or Purchase Price....................................................36
Section 3.06 Notes Redeemed or Purchased in Part........................................................36
Section 3.07 Optional Redemption........................................................................36
Section 3.08 Mandatory Redemption.......................................................................37
Section 3.09 Offer to Purchase by Application of Excess Proceeds........................................37
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes...........................................................................39
Section 4.02 Maintenance of Office or Agency............................................................39
Section 4.03 Reports....................................................................................40
Section 4.04 Compliance Certificate.....................................................................40
Section 4.05 Taxes......................................................................................40
Section 4.06 Stay, Extension and Usury Laws.............................................................41
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Section 4.07 Restricted Payments........................................................................41
Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries..................44
Section 4.09 Incurrence of Indebtedness and Issuance of Certain Capital Stock...........................45
Section 4.10 Asset Sales................................................................................47
Section 4.11 Transactions with Affiliates...............................................................48
Section 4.12 Liens......................................................................................49
Section 4.13 Line of Business...........................................................................49
Section 4.14 Corporate Existence........................................................................49
Section 4.15 Offer to Repurchase Upon Change of Control.................................................50
Section 4.16 Anti-Layering..............................................................................51
Section 4.17 Subsidiary Guarantees......................................................................51
Section 4.18 Designation of Restricted and Unrestricted Subsidiaries....................................52
Section 4.19 Convertible Note Indenture.................................................................52
Section 4.20 Payments for Consent.......................................................................52
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets...................................................53
Section 5.02 Successor Corporation Substituted..........................................................53
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default..........................................................................54
Section 6.02 Acceleration...............................................................................56
Section 6.03 Other Remedies.............................................................................56
Section 6.04 Waiver of Past Defaults....................................................................56
Section 6.05 Control by Majority........................................................................56
Section 6.06 Limitation on Suits........................................................................56
Section 6.07 Rights of Holders of Notes to Receive Payment..............................................57
Section 6.08 Collection Suit by Trustee.................................................................57
Section 6.09 Trustee May File Proofs of Claim...........................................................57
Section 6.10 Priorities.................................................................................58
Section 6.11 Undertaking for Costs......................................................................58
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee..........................................................................58
Section 7.02 Rights of Trustee..........................................................................59
Section 7.03 Individual Rights of Trustee...............................................................60
Section 7.04 Trustee's Disclaimer.......................................................................60
Section 7.05 Notice of Defaults.........................................................................60
Section 7.06 Reports by Trustee to Holders of the Notes.................................................60
Section 7.07 Compensation and Indemnity.................................................................61
Section 7.08 Replacement of Trustee.....................................................................61
Section 7.09 Successor Trustee by Merger, etc...........................................................62
Section 7.10 Eligibility; Disqualification..............................................................62
Section 7.11 Preferential Collection of Claims Against Company..........................................62
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ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance...................................63
Section 8.02 Legal Defeasance and Discharge.............................................................63
Section 8.03 Covenant Defeasance........................................................................63
Section 8.04 Conditions to Legal or Covenant Defeasance.................................................64
Section 8.05 Deposited Money and Government Securities to be Held in Trust; Other Miscellaneous
Provisions.................................................................................65
Section 8.06 Repayment to Company.......................................................................65
Section 8.07 Reinstatement..............................................................................66
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes........................................................66
Section 9.02 With Consent of Holders of Notes...........................................................67
Section 9.03 Compliance with Trust Indenture Act........................................................68
Section 9.04 Revocation and Effect of Consents..........................................................68
Section 9.05 Notation on or Exchange of Notes...........................................................68
Section 9.06 Trustee to Sign Amendments, etc............................................................68
ARTICLE 10.
SUBORDINATION
Section 10.01 Agreement to Subordinate...................................................................69
Section 10.02 Liquidation; Dissolution; Bankruptcy.......................................................69
Section 10.03 Default on Designated Senior Debt..........................................................69
Section 10.04 Acceleration of Notes......................................................................70
Section 10.05 When Distribution Must Be Paid Over........................................................70
Section 10.06 Notice by Company..........................................................................71
Section 10.07 Subrogation................................................................................71
Section 10.08 Relative Rights............................................................................71
Section 10.09 Subordination May Not Be Impaired by Company...............................................71
Section 10.10 Distribution or Notice to Representative...................................................71
Section 10.11 Rights of Trustee and Paying Agent.........................................................72
Section 10.12 Authorization to Effect Subordination......................................................72
Section 10.13 Amendments.................................................................................72
ARTICLE 11.
NOTE GUARANTEES
Section 11.01 Guarantee..................................................................................72
Section 11.02 Subordination of Note Guarantee............................................................73
Section 11.03 Limitation on Guarantor Liability..........................................................74
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms.........................................74
Section 11.05 Releases of Guarantor......................................................................75
ARTICLE 12.
satisfaction and discharge
Section 12.01 Satisfaction and Discharge.................................................................75
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Section 12.02 Application of Trust Money.................................................................76
ARTICLE 13.
MISCELLANEOUS
Section 13.01 Trust Indenture Act Controls...............................................................77
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...............................................................................79
Section 13.12 Counterpart Originals......................................................................79
Section 13.13 Table of Contents, Headings, etc...........................................................79
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of April 29, 2002 between Prime Hospitality Corp., a
Delaware corporation (the "Company") and Xxxxx Fargo Bank Minnesota, NA, as
trustee (the "Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders (as defined) of the
8 3/8% Senior Subordinated Notes due 2012 (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such
other Person merged with or into or became a Subsidiary of such
specified Person, including Indebtedness incurred in connection with,
or in contemplation of, such other Person merging with or into or
becoming a Subsidiary of such specified Person; and
(2) Indebtedness encumbering any asset acquired by such
specified Person.
"Additional Notes" means an unlimited amount of Notes (other than the
Initial Notes) issued under this Indenture in accordance with Sections 2.02 and
4.09 hereof, as part of the same series as the Initial Notes.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided, however,
that beneficial ownership of 10% or more of the voting securities of a Person
shall be deemed to be control.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"Applicable Procedures" means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.
"Asset Sale" means:
(1) the sale, lease (other than operating leases in respect of
facilities which are ancillary to the operation of the Company's or a
Restricted Subsidiary's hotel properties), conveyance or other
disposition of any property or assets of the Company or any Restricted
Subsidiary (including by way of a sale and leaseback transaction and
including a disposition by the Company or a Restricted Subsidiary of
Equity Interests in an Unrestricted Subsidiary);
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(2) the issuance or sale of Equity Interests of any of the
Company's Restricted Subsidiaries; or
(3) any Event of Loss.
Notwithstanding the preceding, none of the following items will be
deemed to be an Asset Sale:
(1) the sale or disposition of personal property held for sale
in the ordinary course of business;
(2) the sale or disposal of damaged, worn out or other
obsolete property in the ordinary course of business so long as such
property is no longer necessary for the proper conduct of the business
of the Company or such Restricted Subsidiary, as applicable;
(3) the transfer of assets by the Company to a Restricted
Subsidiary of the Company or by a Restricted Subsidiary of the Company
to the Company or to another Restricted Subsidiary of the Company;
(4) the exchange of assets held by the Company or a Restricted
Subsidiary of the Company for one or more hotels and/or one or more
Hospitality-Related Businesses of any person or entity owning one or
more hotels and/or one or more Hospitality-Related Businesses;
provided, that the Board of Directors of the Company has determined
that the terms of any exchange are fair and reasonable and that the
fair market value of the assets received by the Company, as set forth
in an opinion of a Qualified Appraiser, are equal to or greater than
the fair market value of the assets exchanged by the Company or a
Restricted Subsidiary of the Company;
(5) any Restricted Payment, dividend or purchase or retirement
of Equity Interests permitted under Section 4.07;
(6) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of the Company in compliance with the
provisions of Sections 3.09, 4.10, 4.15 and 5.01;
(7) the conversion of or foreclosure on any mortgage or note,
provided that the Company or a Restricted Subsidiary receives the real
property underlying any such mortgage or note;
(8) the sale or disposition of those assets pledged as
collateral for the First Mortgage Notes, provided, that the proceeds
from the sale or disposition of such assets shall be used to
temporarily reduce revolving credit borrowings; or
(9) any transaction or series of related transactions that
would otherwise be an Asset Sale where the fair market value of the
assets, sold, leased, conveyed or otherwise disposed of was less than
$10.0 million or an Event of Loss or related series of Events of Loss
pursuant to which the aggregate value of property or assets involved
in such Event of Loss or Events of Loss is less than $10.0 million.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "Person" (as that
2
term is used in Section 13(d)(3) of the Exchange Act), such "Person" will be
deemed to have beneficial ownership of all securities that such "Person" has the
right to acquire by conversion or exercise of other securities, whether such
right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition. The terms "Beneficially Owns" and "Beneficially Owned"
have a corresponding meaning.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of
the corporation;
(2) with respect to a partnership, the Board of Directors of
the general partner of the partnership; and
(3) with respect to any other Person, the board or committee
of such Person serving a similar function.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at such time be so required to be capitalized on the balance sheet in
accordance with GAAP.
"Capital Stock" means any and all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock, including,
without limitation, with respect to partnerships, partnership interests (whether
general or limited) and 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, such partnership.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality thereof having maturities of not more than six months
from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers
acceptances with maturities not exceeding six months from the date of
acquisition and overnight bank deposits, in each case with any domestic
commercial bank having capital and surplus in excess of $500.0 million;
(4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2)
and (3) entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(5) commercial paper or commercial paper Master Notes having a
rating of P-2 or the equivalent thereof by Xxxxx'x Investors Service,
Inc. or A-2 or the equivalent thereof by Standard & Poor's Corporation
and in each case maturing within six months after the date of
acquisition;
3
(6) money market mutual funds that provide daily purchase and
redemption features; and
(7) corporate debt with maturities of not greater than six
months and with a rating of A or the equivalent thereof by Standard &
Poor's Corporation and a rating of A2 or the equivalent thereof by
Xxxxx'x Investors Service, Inc.
"Clearstream" means Clearstream Banking, S.A.
"Change of Control" means the occurrence of any of the following:
(1) the sale, lease or transfer, in one or a series of related
transactions, of all or substantially all of the Company's assets to
any person or group (as such term is used in Section 13(d) (3) of the
Exchange Act) other than to a Wholly Owned Restricted Subsidiary that
is a Guarantor;
(2) the adoption of a plan relating to the liquidation or
dissolution of the Company;
(3) the acquisition by any person or group (as such term is
used in Section 13(d) (3) of the Exchange Act) of a direct or indirect
interest in more than 50% of the ownership of the Company or the voting
power of the voting stock of the Company by way of purchase, merger or
consolidation or otherwise (other than a creation of a holding company
that does not involve a change in the beneficial ownership of the
Company as a result of such transaction);
(4) the merger or consolidation of the Company with or into
another corporation or the merger of another corporation into the
Company with the effect that immediately after such transaction the
stockholders of the Company immediately prior to such transaction hold
less than 50% of the total voting power of all securities generally
entitled to vote in the election of directors, managers, or trustees of
the Person surviving such merger or consolidation; or
(5) the first day on which a majority of the members of the
Board of Directors of the Company are not Continuing Directors.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus:
(1) an amount equal to any extraordinary loss plus any net
loss realized in connection with an Asset Sale, to the extent such
losses were deducted in computing Consolidated Net Income; plus
(2) provision for taxes based on income or profits of such
Person for such period, to the extent such provision for taxes was
included in computing Consolidated Net Income; plus
(3) Consolidated Interest Expense of such Person for such
period to the extent such expense was deducted in computing
Consolidated Net Income; plus
(4) Consolidated Depreciation and Amortization Expense of such
Person for such period, to the extent deducted in computing
Consolidated Net Income in each case, on a consolidated basis for such
Person and its Restricted Subsidiaries and determined in accordance
with GAAP; minus
4
(5) other income as reflected on such Person's consolidated
financial statements, as prepared in accordance with GAAP, to the
extent such other income was included in computing Consolidated Net
Income.
Notwithstanding the foregoing, the provision for taxes on the income or
profits of, the depreciation and amortization of and the interest expense of, a
Restricted Subsidiary of the referent Person shall be added to Consolidated Net
Income to compute Consolidated Cash Flow only to the extent (and in the same
proportion) that the Net Income of such Restricted Subsidiary was included in
calculating the Consolidated Net Income of such Person and only if a
corresponding amount would be permitted at the date of determination to be
dividended to such Person by such Restricted Subsidiary without prior
governmental approval (that has not been obtained), and without direct or
indirect restriction pursuant to the terms of its charter and all agreements,
instruments, judgments, decrees, orders, statutes, rules and governmental
regulations applicable to that Restricted Subsidiary or its stockholders.
Any calculation of the Consolidated Cash Flow of an individual hotel
property shall be calculated in a manner consistent with the foregoing.
"Consolidated Depreciation and Amortization Expense" means, with
respect to any Person for any period, the total amount of depreciation and
amortization expense (including amortization of goodwill and other intangibles
but excluding amortization of prepaid cash expenses that were paid in a prior
period) and the total amount of non-cash charges (other than non-cash charges
that represent an accrual or reserve for cash charges in future periods or which
involved a cash expenditure in a prior period) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis as determined in accordance
with GAAP.
"Consolidated Interest Expense" means, with respect to any Person for
any period, without duplication, the sum of:
(1) interest expense, whether paid or accrued, to the extent
such expense was deducted in computing Consolidated Net Income
(including amortization of original issue discount, non-cash interest
payments, the interest component of Capital Lease Obligations, and net
payments (if any) pursuant to Hedging Obligations, but excluding
amortization of deferred financing fees);
(2) commissions, discounts and other fees and charges paid or
accrued with respect to letters of credit and bankers acceptance
financing; and
(3) interest for which such Person or its Restricted
Subsidiaries is liable, whether or not actually paid, pursuant to
Indebtedness or under a Guarantee of Indebtedness of any other Person;
in each case, calculated for such Person and its Restricted
Subsidiaries for such period on a consolidated basis as determined in
accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that the following shall be excluded:
(1) the Net Income of any Person that is not a Restricted
Subsidiary or that is accounted for by the equity method of accounting
shall be excluded, whether or not distributed to the Company or one of
its Restricted Subsidiaries;
(2) the Net Income of any Person that is a Restricted
Subsidiary and that is restricted from declaring or paying dividends or
other distributions, directly or indirectly, by operation of
5
the terms of its charter, any applicable agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation or
otherwise shall be included only to the extent of the amount of
dividends or distributions paid to the referent Person or a Wholly
Owned Restricted Subsidiary;
(3) the Net Income of any Person acquired in a pooling of
interests transaction for any period prior to the date of such
acquisition; and
(4) the cumulative effect of change in accounting principles.
"Consolidated Net Worth" means, with respect to any Person, as of any
date of determination, the sum of:
(1) the consolidated equity of the common stockholders of such
Person and its consolidated Subsidiaries as of such date plus
(2) the respective amounts reported on such Person's balance
sheet as of such date with respect to any series of Preferred Stock
(other than Disqualified Stock) that by its terms is not entitled to
the payment of dividends unless such dividends may be declared and paid
only out of net earnings in respect of the year of such declaration and
payment, but only to the extent of any cash received by such Person
upon issuance of such Preferred Stock, less (x) all write-ups (other
than write-ups resulting from foreign currency translations and
write-ups of tangible assets of a going concern business made within 12
months after the acquisition of such business) subsequent to the
Issuance Date in the book value of any asset owned by such Person or a
consolidated Subsidiary of such Person, (y) all Investments as of such
date in unconsolidated Subsidiaries and in Persons that are not
Subsidiaries (except, in each case, Permitted Investments) and (z) all
unamortized debt discount and expense and unamortized deferred charges
as of such date, all of the foregoing determined in accordance with
GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who:
(1) was a member of such Board of Directors on the date of
this Indenture; or
(2) was nominated for election or elected to such Board of
Directors with the affirmative vote of at least a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" will 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.
"Credit Facilities" means one or more borrowing arrangements, to be
entered into, by and between the Company and/or one or more Restricted
Subsidiaries and a commercial bank or other institutional lender, including any
related notes, security documentation, guarantees, collateral documents,
instruments and agreements executed in connection therewith, in each case as
amended, modified, supplemented, restructured, renewed, restated, refunded,
replaced or refinanced or extended from time to time on one or more occasions.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
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"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,
substantially in the form of Exhibit A hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Designated Senior Debt" means:
(1) Indebtedness under or in respect of a Credit Facility;
(2) Indebtedness under or in respect of the Company's 9 1/4%
First Mortgage Notes due 2006; and
(3) any other Indebtedness constituting Senior Debt which, at
the time of determination, has an aggregate principal amount of at
least $25.0 million and is specifically designated in the instrument
evidencing such Senior Debt as "Designated Senior Debt" by the Company.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.07.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for Capital Stock).
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
"Event of Loss" means, with respect to any property or asset (tangible
or intangible, real or personal), any of the following: (A) any loss,
destruction or damage of such property or asset; or (B) any actual condemnation,
seizure or taking by the power of eminent domain or otherwise of such property
or asset, or confiscation of such property or asset or the requisition of the
use of such property or asset.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
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"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence on the date of this Indenture (after giving
effect to the use of proceeds of the Offering), excluding, for this purpose,
amounts committed for under Credit Facilities as in effect on the date of this
Indenture.
"Existing Real Estate" means any real estate owned, leased or optioned
by the Company or any of its Subsidiaries on the date of this Indenture, or any
real estate on which the Company or any of its Subsidiaries holds a mortgage on
the date of this Indenture.
"Fixed Charge Coverage Ratio" means with respect to any Person for any
period, the ratio of the Consolidated Cash Flow of such Person for such period
to the Fixed Charges of such Person for such period. In the event that the
Company or any of its Restricted Subsidiaries incurs, assumes, guarantees or
redeems any Indebtedness (other than revolving credit borrowings that provide
working capital in the ordinary course of business) or issues or redeems
Preferred Stock subsequent to the commencement of the period for which the Fixed
Charge Coverage Ratio is being calculated but prior to the date on which the
event for which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated
giving pro forma effect to such incurrence, assumption, guarantee or redemption
of Indebtedness, or such issuance or redemption of Preferred Stock, as if the
same had occurred at the beginning of the applicable four-quarter reference
period.
For purposes of making the computation referred to above, acquisitions,
dispositions and discontinued operations (as determined in accordance with GAAP)
that have been made by the Company or any of its Restricted Subsidiaries,
including all mergers, consolidations and dispositions, during the four-quarter
reference period or subsequent to such reference period and on or prior to the
Calculation Date shall be calculated on a pro forma basis assuming that all such
acquisitions, dispositions, discontinued operations, mergers, consolidations
(and the reduction of any associated fixed charge obligations resulting
therefrom) had occurred on the first day of the four-quarter reference period.
"Fixed Charges" means, with respect to any Person for any period, the
sum of:
(1) Consolidated Interest Expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, to
the extent such expense was deducted in computing Consolidated Net
Income; plus
(2) the product of (i) all cash dividend payments (and
non-cash dividend payments in the case of a Person that is a Restricted
Subsidiary) on any series of Preferred Stock of such Person or its
Restricted Subsidiaries (other than Preferred Stock owned by such
Person or its Restricted Subsidiaries), times (ii) a fraction, the
numerator of which is one and the denominator of which is one, minus
the then current combined federal, state and local statutory tax rate
of such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
8
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, substantially in the
form of Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section 2.06(g)(2),
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 for the payment of which obligations
or guarantee the full faith and credit of the United States of America is
pledged.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business) or otherwise
incurring, assuming or becoming liable for the payment of any principal, premium
or interest, direct or indirect, in any manner (including, without limitation,
letters of credit and reimbursement agreements in respect thereof), of all or
any part of any Indebtedness.
"Guarantors" means such Persons that become a guarantor of the notes
pursuant to the terms of this Indenture, and each of their respective
successors.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under:
(1) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements; and
(2) 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.
"Hospitality-Related Business" means the hotel business and other
businesses necessary for, incident to, in support of, connected with or arising
out of the hotel business, including, without limitation, (i) developing,
managing, operating, improving or acquiring lodging facilities, restaurants and
other food-service facilities, sports or entertainment facilities, and
convention or meeting facilities, and marketing services related thereto, (ii)
acquiring, developing, operating, managing or improving the Existing Real
Estate, any real estate taken in foreclosure (or similar settlement) by the
Company or any of its Restricted Subsidiaries, or any real estate ancillary or
connected to any hotel owned, managed or operated by the Company or any of its
Restricted Subsidiaries, (iii) owning and managing mortgages in, or other
Indebtedness secured by Liens on hotels and real estate related or ancillary to
hotels or (iv) other related activities thereto.
"IAI Global Note" means a Global Note substantially in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with or on behalf of and registered in the name of the Depositary
or its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
"Indebtedness" means, with respect to any Person, any indebtedness of
such Person, whether or not contingent:
9
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in
respect thereof),
(3) representing Capital Lease Obligations;
(4) the balance deferred and unpaid of the purchase price of
any property; or
(5) representing any Hedging Obligations,
except any such balance that constitutes an accrued expense or trade payable, if
and to the extent any of the foregoing 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, and also includes, to the
extent not otherwise included, the Guarantee of any Indebtedness of such Person
or any other Person.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means the first $200 million aggregate principal amount
of Notes issued under this Indenture on the date hereof.
"Initial Purchaser" means Bear, Xxxxxxx & Co. Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of loans
(including Guarantees), advances or capital contributions (excluding commission,
travel and similar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities and all other items that are
or would be classified as investments on a balance sheet prepared in accordance
with GAAP. 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, the Company no longer owns, directly or indirectly, greater than
50% of the outstanding Common Stock of such Restricted Subsidiary, the Company
shall be deemed to have made an Investment on the date of any such sale or
disposition equal to the fair market value of the Common Stock of such
Restricted Subsidiary not sold or disposed of.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be prepared
by the Company and sent to all Holders of the Notes for use by such Holders in
connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the
10
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).
"Liquidated Damages" means all liquidated damages then owing pursuant
to the Registration Rights Agreement.
"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, any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with any Asset Sale, and excluding any
extraordinary gain (but not loss), together with any related provision for taxes
on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale, net
of the direct costs relating to such Asset Sale (including, without limitation,
legal, accounting and investment banking fees, and sales commissions), and any
relocation expenses incurred as a result thereof, taxes paid or payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), amounts required to be applied to
the repayment of Indebtedness secured by a Lien on the asset or assets the
subject of such Asset Sale and any reserve for adjustment in respect of the sale
price of such asset or assets.
"Non-Recourse Indebtedness" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries:
(a) provides credit support (other than in the form
of a Lien on an asset serving as security for Non-Recourse
Indebtedness) pursuant to any undertaking, agreement or
instrument that would constitute Indebtedness;
(b) is directly or indirectly liable (other than in
the form of a Lien on an asset serving as security for
Non-Recourse Indebtedness); or
(c) constitutes the lender; and
(2) no default with respect to which (including 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 other Indebtedness 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.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Notes" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes shall be treated as a
single class for all purposes under this Indenture, and unless the context
otherwise requires, all references to the Notes shall include the Initial Notes
and any Additional Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
11
"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
Section 13.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
13.05 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Investments" means:
(1) any Investments in the Company or any Guarantor;
(2) Investments in any Restricted Subsidiary that is not a
Guarantor not to exceed an aggregate of $5.0 million per Restricted
Subsidiary;
(3) any Investments in Cash Equivalents;
(4) Investments by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of
the Company or any Guarantor; 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 a Restricted Subsidiary of the Company or any
Guarantor;
(5) 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 Section 4.10;
(6) any acquisition of assets solely in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the
Company;
(7) any Investments received in compromise of obligations of
such persons incurred in the ordinary course of trade creditors or
customers that were incurred in the ordinary course of business,
including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of any trade creditor or
customer;
(8) Hedging Obligations; and
12
(9) net cash advances to Restricted Subsidiaries in the
ordinary course of business and consistent with the Company's past cash
management practices in an amount not to exceed $30.0 million at any
one time outstanding.
"Permitted Junior Securities" means Equity Interest in the Company or
debt securities that are subordinated to all Senior Debt (and any debt
securities issued in exchange for Senior Debt) to substantially the same extent
as, or to a greater extent than, the notes are subordinated to Senior Debt
pursuant to Article 10 of this Indenture.
"Permitted Liens" means:
(1) Liens of the Company securing Senior Debt that was
permitted by the terms of this Indenture to be incurred;
(2) Liens in favor of the Company,
(3) Liens on property of a Person existing at the time such
Person is merged with or into or consolidated with the Company or any
Restricted Subsidiary of the Company; provided that such Liens were in
existence prior to the contemplation of such merger or consolidation
and do not extend to any assets other than those of the Person merged
into or consolidated with the Company or the Restricted Subsidiary;
(4) Liens on property existing at the time of acquisition of
the property by the Company or any Restricted Subsidiary of the
Company, provided that such Liens were in existence prior to the
contemplation of such acquisition;
(5) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business;
(6) Liens existing on the date of this Indenture,
(7) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and diligently
concluded, provided that any reserve or other appropriate provision as
is required in conformity with GAAP has been made therefor;
(8) Liens securing Non-Recourse Indebtedness;
(9) Liens incurred in connection with Credit Facilities; and
(10) Liens incurred in the ordinary course of business of the
Company or any Restricted Subsidiary of the Company with respect to
obligations that do not exceed $5.0 million at any one time
outstanding.
"Permitted Refinancing" means Refinancing Indebtedness or Refinancing
Disqualified Stock, as the case may be, to the extent:
(l) the principal amount of Refinancing Indebtedness or the
liquidation preference amount of Refinancing Disqualified Stock, as the
case may be, does not exceed the principal amount of Indebtedness or
the liquidation preference amount of Disqualified Stock, as the case
13
may be, so extended, refinanced, renewed, replaced, defeased or
refunded (plus the amount of premiums and reasonable expenses incurred
in connection therewith);
(2) such Refinancing Indebtedness or Refinancing Disqualified
Stock, as the case may be, is scheduled to mature or is redeemable at
the option of the holder, as the case may be, no earlier than the
Indebtedness or Disqualified Stock, as the case may be, being
refinanced;
(3) in the case of Refinancing Indebtedness, the Refinancing
Indebtedness 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;
(4) in the case of Refinancing Disqualified Stock, the
Disqualified Stock has a Weighted Average Life to Mandatory Redemption
equal to or greater than the Weighted Average Life to Mandatory
Redemption of the Disqualified Stock being extended, refinanced,
renewed, replaced, defeased or refunded; or
(5) if the Indebtedness or the Disqualified Stock, as the case
may be, being extended, refinanced, renewed, replaced, defeased or
refunded is subordinated or junior in right of payment to the notes,
the Refinancing Indebtedness or Refinancing Disqualified Stock, as the
case may be, is subordinated or junior in right of payment to the notes
on terms at least as favorable to the holders of notes as those
contained in the documentation governing the Indebtedness or the
Disqualified Stock, as the case may be, being extended, refinanced,
renewed, replaced, defeased or refunded or is payable solely in Equity
Interests of the Person whose Indebtedness is being purchased, redeemed
or otherwise acquired or retired for value.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, government
or any agency or political subdivision thereof or any other entity.
"Preferred Stock" means any Equity Interest with preferential right in
the payment of dividends or liquidation or any Disqualified Stock.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(1) to be placed on all Notes issued under this Indenture except where
otherwise permitted by the provisions of this Indenture.
"Refinancing Disqualified Stock" means Disqualified Stock issued in
exchange for, or the proceeds of which are used, to extend, refinance, renew,
replace, defease or refund Disqualified Stock or Indebtedness permitted to be
issued pursuant to the Fixed Charge Coverage Ratio test set forth in the first
paragraph of Section 4.09 or Indebtedness referred to in clauses (3), (5), (7)
and (9) of the second paragraph of such covenant.
"Refinancing Indebtedness" means Indebtedness issued in exchange for,
or the proceeds of which are used to extend, refinance, renew, replace, defease
or refund Indebtedness permitted to be incurred pursuant to the Fixed Charge
Coverage Ratio test set forth in Section 4.09 or Indebtedness referred to in
clauses (3), (5), (7) and (9) of the second paragraph of Section 4.09.
"Representative" means this Indenture trustee or other trustee, agent
or representative in respect of Designated Senior Debt, provided, that if, and
for so long as, any Designated Senior Debt lacks such a representative, then the
Representative for such Designated Senior Debt shall at all times constitute the
14
holders of a majority in outstanding principal amount of such Designated Senior
Debt in respect of any Designated Senior Debt.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of April 29, 2002, between the Company and the other parties
named on the signature pages thereof, as such agreement may be amended, modified
or supplemented from time to time and, with respect to any Additional Notes, one
or more registration rights agreements between the Company and the other parties
thereto, as such agreement(s) may be amended, modified or supplemented from time
to time, relating to rights given by the Company to the purchasers of Additional
Notes to register such Additional Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Global Note bearing the Private
Placement Legend and deposited with or on behalf of the Depositary and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Notes initially
sold in reliance on Rule 903 of Regulation S.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means, in the case of the Company or any Guarantor, the
principal of, premium, if any, and interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on any Indebtedness of the Company, whether
outstanding on the date of this Indenture or thereafter created, incurred or
assumed, unless, in the case of any particular Indebtedness, the
15
instrument creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall not be senior in
right of payment to the notes.
Without limiting the generality of the foregoing, "Senior Debt" shall
also include the principal of, premium, if any, interest (including any interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on, and all other amounts
owing in respect of:
(1) all Obligations of every nature of the Company under
Credit Facilities, including, without limitation, obligations to pay
principal and interest, reimbursement obligations under letters of
credit, fees, expenses and indemnities, whether outstanding on the date
of this Indenture or thereafter incurred;
(2) all Hedging Obligations (including Guarantees thereof),
whether outstanding on the date of this Indenture or thereafter
incurred; and
(3) the Company's 9 1/4% First Mortgage Notes due 2006.
Notwithstanding the foregoing, "Senior Debt" shall not include:
(1) any Indebtedness of the Company or any Guarantor to a
Subsidiary of the Company or any Affiliate of the Company or any of
such Affiliate's Subsidiaries;
(2) Indebtedness to, or guaranteed on behalf of, any
shareholder, director, officer or employee of the Company or any
Subsidiary of the Company or any Guarantor (including, without
limitation, amounts owed for compensation);
(3) Indebtedness to trade creditors and other amounts incurred
in connection with obtaining goods, materials or services;
(4) any liability for federal, state, local or other taxes
owed or owing by the Company or any Guarantor;
(5) that portion of Indebtedness incurred in violation of this
Indenture; and
(6) any Indebtedness which is, by its express terms,
subordinated in right of payment to any other Indebtedness of the
Company or any Guarantor.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"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 Act, as such Regulation is in effect on the date
hereof.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person or a combination
thereof.
16
"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.
"Trustee" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor serving
hereunder.
"Unrestricted Global Note" means a permanent global Note substantially
in the form of Exhibit A attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes that
do not bear and are not required to bear the Private Placement Legend.
"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:
(1) has no Indebtedness other than Non-Recourse Indebtedness;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are 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;
(3) is a Person with respect to which neither the Company nor
any of its Restricted Subsidiaries has any direct or indirect
obligation (x) to subscribe for additional Equity Interests or (y) to
maintain or preserve such Person's financial condition or to cause such
Person to achieve any specified levels of operating results;
(4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries; and
(5) has at least one director on its board of directors that
is not a director or executive officer of the Company or any of its
Restricted Subsidiaries and has at least one executive officer that is
not a director or executive officer of the Company or any of its
Restricted Subsidiaries.
Any 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 4.07. If, at any time, any Unrestricted Subsidiary would fail to meet
the foregoing requirements as an Unrestricted Subsidiary, it shall thereafter
cease to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09, the Company shall
be in default of such covenant). 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 (1) such Indebtedness is permitted under Section 4.09 and (2) no
Default or Event of Default would be in existence following such designation.
17
"U.S. Person" means a U.S. Person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Mandatory Redemption" means, when applied to
any Disqualified Stock at any date, the number of years obtained by dividing (a)
the sum of the products obtained by multiplying (x) 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 (y)
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
liquidation preference amount of such Disqualified Stock.
"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 (x) 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 (y) 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 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 Restricted
Subsidiaries of such Person.
Section 1.02 Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction"............................................................. 4.11
"Asset Sale Offer".................................................................. 3.09
"Authentication Order".............................................................. 2.02
"Change of Control Offer"........................................................... 4.15
"Change of Control Payment"......................................................... 4.15
"Change of Control Payment Date".................................................... 4.15
"Covenant Defeasance"............................................................... 8.03
"DTC"............................................................................... 2.03
"Event of Default".................................................................. 6.01
"Excess Proceeds"................................................................... 4.10
"incur"............................................................................. 4.09
"Legal Defeasance".................................................................. 8.02
"Offer Amount"...................................................................... 3.09
"Offer Period"...................................................................... 3.09
"Paying Agent"...................................................................... 2.03
"Permitted Debt".................................................................... 4.09
"Purchase Date"..................................................................... 3.09
"Registrar"......................................................................... 2.03
"Restricted Payments"............................................................... 4.07
18
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes 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 SEC rule under the TIA
have the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular;
(5) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and transactions;
and
(7) references to sections of or rules under the Securities
Act will be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC 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
will be substantially in the form of Exhibit A hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule, usage
or agreements to which the Company or any Guarantor is subject. Each Note will
be dated the date of its authentication. The Notes shall be in denominations of
$1,000 and integral multiples thereof.
19
The terms and provisions contained in the Notes will 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 issued in global form will be substantially in
the form of Exhibit A attached hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form will be substantially in the form of
Exhibit A attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note will represent such of the outstanding Notes as will
be specified therein and each shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and
that the aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding Notes
represented thereby will be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
(c) Euroclear and Clearstream Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream
Banking" and "Customer Handbook" of Clearstream will be applicable to transfers
of beneficial interests in the Regulation S Global Notes that are held by
Participants through Euroclear or Clearstream.
Section 2.02 Execution and Authentication.
An Officer must sign the Notes for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note will nevertheless be valid.
A Note will not be valid until authenticated by the manual signature of
the Trustee. The signature of the Trustee will be conclusive evidence that the
Note has been authenticated under this Indenture.
The Trustee will, upon receipt of a written order of the Company signed
by two Officers (an "Authentication Order"), authenticate Notes for original
issue up to the aggregate principal amount stated in the Notes.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company will 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 will 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
20
"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 will notify the Trustee in writing of
the name and address of any Agent not a party to this Indenture. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act as
Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company will 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 held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, 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) will have no further liability for the money delivered to the
Trustee. If the Company or a Subsidiary acts as Paying Agent, it will 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 will serve as Paying Agent for the Notes.
Section 2.05 Holder Lists.
The Trustee will 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 will furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be transferred
as a whole except by the Depositary to a nominee of the Depositary, by a nominee
of the Depositary to the Depositary or to another nominee of the Depositary, or
by the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary. All Global Notes will be exchanged by the Company for
Definitive Notes if:
(1) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary;
(2) the Company in its sole discretion determines that the
Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and delivers a written notice to such effect to the
Trustee;
21
(3) or there has occurred and is continuing an Even of Default
with respect to the Notes.
Upon the occurrence of either of the preceding events in (1) or (2)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 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. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes will be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes will be subject to restrictions on transfer comparable to those set
forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also will require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend.
Beneficial interests in any Unrestricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to
effect the transfers described in this Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(1) above,
the transferor of such beneficial interest must deliver to the
Registrar either:
(A) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an
amount equal to the beneficial interest to be
transferred or exchanged; and
(ii) instructions given in accordance with
the Applicable Procedures containing information
regarding the Participant account to be credited with
such increase; or
(B) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive
Note in an amount equal to the beneficial interest to
be transferred or exchanged; and
22
(ii) instructions given by the Depositary to
the Registrar containing information regarding the
Person in whose name such Definitive Note shall be
registered to effect the transfer or exchange
referred to in (1) above. Upon consummation of an
Exchange Offer by the Company in accordance with
Section 2.06(f) hereof, the requirements of this
Section 2.06(b)(2) shall be deemed to have been
satisfied upon receipt by the Registrar of the
instructions contained in the Letter of Transmittal
delivered by the Holder of such beneficial interests
in the Restricted Global Notes. 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(h) hereof.
(3) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form
of a beneficial interest in the 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form
of a beneficial interest in the Regulation S Global Note, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2)
thereof; and
(C) if the transferee will take delivery in the form
of a beneficial interest in the IAI Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications, certificates and Opinion
of Counsel required by item (3) thereof, if applicable.
(4) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may be
exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note if the exchange or transfer complies with the requirements of
Section 2.06(b)(2) above and:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (i) a Broker-Dealer, (ii) a Person
participating in the distribution of the Exchange Notes or
(iii) a Person who is an affiliate (as defined in Rule 144) of
the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
23
(D) the Registrar receives the following:
(i) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a)
thereof; or
(ii) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted 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
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(1) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest in
a Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Restricted Definitive Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred
to a QIB in accordance with Rule 144A, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred
to a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (2) thereof;
24
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred
to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities
Act other than those listed in subparagraphs (B) through (D)
above, a certificate to the effect set forth in Exhibit B
hereto, including the certifications, certificates and Opinion
of Counsel required by item (3) thereof, if applicable;
(F) if such beneficial interest is being transferred
to the Company or any of its Subsidiaries, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(c)
thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) 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 in a Restricted Global Note 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. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(1) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(2) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the holder of such beneficial interest, in the
case of an exchange, or the transferee, in the case of a
transfer, certifies in the applicable Letter of Transmittal
that it is not (i) a Broker-Dealer, (ii) a Person
participating in the distribution of the Exchange Notes or
(iii) a Person who is an affiliate (as defined in Rule 144) of
the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
25
(i) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a Definitive
Note that does not bear the Private Placement Legend,
a certificate from such holder in the form of Exhibit
C hereto, including the certifications in item (1)(b)
thereof; or
(ii) if the holder of such beneficial
interest in a Restricted Global Note proposes to
transfer such beneficial interest to a Person who
shall take delivery thereof in the form of a
Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in
the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(3) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive
Note, then, upon satisfaction of the conditions set forth in Section
2.06(b)(2) hereof, the Trustee will cause the aggregate principal
amount of the applicable Global Note to be reduced accordingly pursuant
to Section 2.06(h) hereof, and the Company will execute and the Trustee
will 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)(3) will be registered in such name or names and
in such authorized denomination or denominations as the holder of such
beneficial interest requests through instructions to the Registrar from
or through the Depositary and the Participant or Indirect Participant.
The Trustee will deliver such Definitive Notes to the Persons in whose
names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(3)
will not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(1) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive Notes
to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(2)(b) thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
26
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements of
the Securities Act other than those listed in subparagraphs
(B) through (D) above, a certificate to the effect set forth
in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee will cancel the Restricted Definitive Note,
increase or cause to be increased the aggregate principal
amount of, in the case of clause (A) above, the appropriate
Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the
Regulation S Global Note, and in all other cases, the IAI
Global Note.
(2) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the distribution
of the Exchange Notes or (iii) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a
certificate from
27
such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof;
or
(ii) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the
Definitive Notes and increase or cause to be increased the aggregate
principal amount of the Unrestricted Global Note.
(3) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note at any time. Upon receipt of a request for
such an exchange or transfer, the Trustee will cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B),
(2)(D) or (3) above at a time when an Unrestricted Global Note has not
yet been issued, the Company will issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee will authenticate one or more Unrestricted 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 will register the transfer
or exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(1) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the form
of a Restricted Definitive Note if the Registrar receives the
following:
(A) if the transfer will be made pursuant to Rule
144A under the Securities Act, then the transferor must
deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
28
(B) if the transfer will be made pursuant to Rule 903
or Rule 904, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in
item (2) thereof; and
(C) if the transfer will be made pursuant to any
other exemption from the registration requirements of the
Securities Act, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(2) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a Person
or Persons who take delivery thereof in the form of an Unrestricted
Definitive Note if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
broker-dealer, (ii) a Person participating in the distribution
of the Exchange Notes or (iii) a Person who is an affiliate
(as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) any such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes for
an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d) thereof;
or
(ii) if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to a
Person who shall take delivery thereof in the form of
an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if
the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(3) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a Person who
takes delivery thereof in the form of an Unrestricted Definitive Note. Upon
receipt of a request to register such a transfer, the Registrar shall register
the Unrestricted Definitive Notes pursuant to the instructions from the Holder
thereof.
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(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company will issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee will authenticate:
(1) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered into the Exchange
Offer by Persons that certify in the applicable Letters of Transmittal
that (A) they are not Broker-Dealers, (B) they are not participating in
a distribution of the Exchange Notes and (z) they are not affiliates
(as defined in Rule 144) of the Company; and
(2) Unrestricted Definitive Notes in an aggregate principal
amount equal to the principal amount of the Restricted Definitive Notes
accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee will cause
the aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company will execute and the Trustee will
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Unrestricted Definitive Notes in the appropriate principal
amount.
(g) Legends. The following legends will appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below,
each Global Note and each Definitive Note (and all Notes
issued in exchange therefor or substitution thereof) shall
bear the legend in substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) SUCH SECURITY MAY
BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (1) (a) IN THE UNITED STATES TO
A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (c) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (d)
TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a) (1), (2),
(3) OR (7) OF THE SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR")) THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF
NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO PRIME HOSPITALITY
CORP. THAT SUCH TRANSFER IS IN
30
COMPLIANCE WITH THE SECURITIES ACT OR (e) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN
OPINION OF COUNSEL IF PRIME HOSPITALITY CORP. SO REQUESTS), (2) TO PRIME
HOSPITALITY CORP. OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(4),
(c)(2), (c)(3), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of this
Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) will not bear the Private Placement
Legend.
(2) Global Note Legend Each Global Note will bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (00 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to or
retained and canceled 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
31
will take delivery thereof in the form of a beneficial interest in another
Global Note or for Definitive Notes, the principal amount of Notes represented
by such Global Note will be reduced accordingly and an endorsement will 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
will be increased accordingly and an endorsement will be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the
Company will execute and the Trustee will authenticate Global Notes and
Definitive Notes upon receipt of an Authentication Order in accordance
with Section 2.02 or at the Registrar's request.
(2) No service charge will be made to a Holder of a Global
Note or to a Holder of a Definitive Note for any registration of
transfer or exchange, but the Company may require 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 2.10, 3.06, 3.09, 4.10, 4.15 and 9.05 hereof).
(3) The Registrar will 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.
(4) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes will 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.
(5) The Company will 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 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.
(6) 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, premium, if any, and interest on such Notes and for all
other purposes, whether or not such note is overdue and none of the
Trustee, any Agent or the Company shall be affected by notice to the
contrary.
(7) The Trustee will authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
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(8) 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 will issue and the Trustee, upon receipt of an
Authentication Order, will 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
will be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those reductions in the interest in a Global Note effected by the
Trustee in accordance with the provisions hereof, and those described in this
Section as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note.
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 protected 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.
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 will be deemed to be no longer outstanding and will cease to accrue
interest.
Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or any Affiliate of the Company, will be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
will be protected in relying on any such direction, waiver or consent, only
Notes that the Trustee knows are so owned will 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,
will authenticate temporary Notes. Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company will prepare and the Trustee,
upon receipt of an Authentication Order,
33
will authenticate definitive Notes in exchange for temporary Notes. Until such
exchange, temporary Notes shall be entitled to the same rights, benefits and
privileges as definitive Notes.
Holders of temporary Notes will 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 will forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else will cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and will destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act), unless the Company directs them to be returned to it. Certification of the
destruction of all canceled Notes will be delivered to the Company. The Company
may not issue new Notes to replace Notes that it has redeemed or paid or that
have been delivered to the Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it will
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 will 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 will fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
may be less than five 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) will mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it must furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date (unless a
shorter notice period shall be satisfactory to the Trustee), an Officers'
Certificate setting forth:
(1) the clause of this Indenture pursuant to which the
redemption shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee will select Notes for redemption or
purchase as follows:
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(1) if the Notes are listed on any national securities
exchange, in compliance with the requirements of the principal national
securities exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national securities
exchange, on a pro rata basis, by lot or by such method as the Trustee
shall deem fair and appropriate.
In the event of partial redemption or purchase by lot, the particular
Notes to be redeemed or purchased will be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption or
purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase. If a partial redemption is made, selection of the
Notes or portions thereof for redemption shall be made by the Trustee only on a
pro rata basis or on as nearly a pro rata basis as is practicable (subject to
the procedures of DTC), unless such method is clearly prohibited.
The Trustee will promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected will be in principal amounts of
$1,000 or whole multiples of $1,000; except that if all of the Notes of a Holder
are to be redeemed or purchased, the entire outstanding principal amount of
Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed
or purchased. Except as provided in the preceding sentence, provisions of this
Indenture that apply to Notes called for redemption or purchase also apply to
portions of Notes called for redemption or purchase.
Section 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days but
not more than 60 days before a redemption date, the Company will mail or cause
to be mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address, except that redemption
notices may be mailed more than 60 days prior to a redemption date if the notice
is issued in connection with a defeasance of the Notes or a satisfaction and
discharge of this Indenture pursuant to Articles 8 or 12 of this Indenture.
The notice will identify the Notes to be redeemed and will state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes of the
same series in principal amount equal to the unredeemed portion will be
issued upon cancellation of the original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date;
35
(7) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being
redeemed; and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Notes.
At the Company's request, the Trustee will give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company has delivered to the Trustee, at least five days prior to the date such
notice is to be given, 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. A notice of redemption may not be
conditional.
Section 3.05 Deposit of Redemption or Purchase Price.
At least one Business Day prior to the redemption or purchase price
date, the Company will deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption or purchase price of and accrued interest and
Liquidated Damages, if any, on all Notes to be redeemed or purchased on that
date. The Trustee or the Paying Agent will promptly and in any event within two
Business Days, return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption or purchase price of, and accrued interest and Liquidated Damages, if
any, on, all Notes to be redeemed or purchased.
If the Company complies with the provisions of the preceding paragraph,
on and after the redemption or purchase date, interest or Liquidated Damages, if
any, will cease to accrue on the Notes or the portions of Notes called for
redemption or purchase. If a Note is redeemed or purchased on or after an
interest record date but on or prior to the related interest payment date, then
any accrued and unpaid interest shall be paid to the Person in whose name such
Note was registered at the close of business on such interest payment date. If
any Note called for redemption or purchase is not so paid upon surrender for
redemption or purchase because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption or purchase date until such principal is paid, and to the extent
lawful on any interest not paid on such unpaid principal, from the redemption
date until such unpaid interest is paid, in each case at the rate provided in
the Notes and in Section 4.01 hereof.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the
Company will issue and, upon receipt of an Authentication Order, the Trustee
will authenticate for the Holder at the expense of the Company a new Note equal
in principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) At any time prior to May 1, 2005, the Company may redeem up to 35%
of the aggregate principal amount of Notes issued under this Indenture at a
redemption price of 108.375% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, to the redemption date,
36
with the net cash proceeds of one or more public offerings of its common equity
(a "Public Equity Offering"); provided that:
(1) at least 65% of the aggregate principal amount of Notes
issued under this Indenture remains outstanding immediately after the
occurrence of such redemption (excluding Notes held by the Company and
its Subsidiaries); and
(2) the redemption must occur within 90 days of the date of
the closing of such Public Equity Offering.
(b) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Company's option prior to May 1, 2007.
(c) After May 1, 2007 the Company may redeem all or a part of the Notes
upon not less than 30 nor more than 60 days notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest and Liquidated Damages, if any, thereon, to the applicable
redemption date, if redeemed during the twelve-month period beginning on May 1
of the years indicated below:
Year Percentage
---- ----------
2007 ..................................................................... 104.1%
2008 ..................................................................... 102.7%
2009 ..................................................................... 101.3%
2010 and thereafter....................................................... 100.0%
(d) 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.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company is
required to commence an offer to all Holders to purchase Notes (an "Asset Sale
Offer"), it will follow the procedures specified below.
The Asset Sale Offer shall be made to all Holders and all holders of
other Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in this Indenture with respect to offers to purchase
or redeem with the proceeds of sales and assets. The Asset Sale Offer will
remain open for a period of at least 20 Business Days following its commencement
and not more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the "Offer Period"). No later than three Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company will apply all Excess Proceeds (the "Offer Amount") to the purchase of
Notes and such other pari passu Indebtedness (on a pro rata basis, if
applicable) or, if less than the Offer Amount has been tendered, all Notes and
other Indebtedness tendered in response to the Asset Sale Offer. Payment for any
Notes so purchased will be made in the same manner as interest payments are
made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest, and
Liquidated Damages, if any, will be paid to the Person
37
in whose name a Note is registered at the close of business on such record date,
and no additional interest will be payable to Holders who tender Notes pursuant
to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company will send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice will contain all instructions and materials necessary
to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The
notice, which will govern the terms of the Asset Sale Offer, will state:
(1) that the Asset Sale Offer is being made pursuant to this
Section 3.09 and Section 4.10 hereof and the length of time the Asset
Sale Offer will remain open;
(2) the Offer Amount, the purchase price and the Purchase
Date;
(3) that any Note not tendered or accepted for payment will
continue to accrue interest;
(4) that, unless the Company defaults in making such payment,
any Note accepted for payment pursuant to the Asset Sale Offer will
cease to accrue interest after the Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to
an Asset Sale Offer may elect to have Notes purchased in integral
multiples of $1,000 only;
(6) that Holders electing to have a Note purchased pursuant to
any Asset Sale Offer will be required to surrender the Note, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of
the Note completed, or transfer by book-entry transfer, to the Company,
a Depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase
Date;
(7) that Holders will be entitled to withdraw their election
if the Company, the Depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Note the Holder
delivered for purchase and a statement that such Xxxxxx is withdrawing
his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes and other
pari passu Indebtedness surrendered by Holders exceeds the Offer
Amount, the Company will select the Notes and other pari passu
Indebtedness to be purchased on a pro rata basis based on the principal
amount of Notes and such other pari passu Indebtedness surrendered
(with such adjustments as may be deemed appropriate by the Company so
that only Notes in denominations of $1,000, or integral multiples
thereof, will be purchased); and
(9) that Holders whose Notes were purchased only in part will
be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry
transfer).
On or before the Purchase Date, the Company will, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and will
deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as
the case may be, will promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of
38
the Notes tendered by such Holder and accepted by the Company for purchase, and
the Company will promptly issue a new Note, and the Trustee, upon written
request from the Company will authenticate and mail or deliver such new Note to
such Holder, in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company will publicly announce the
results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes.
The Company will pay or cause to be paid the principal of, premium, if
any, and interest and Liquidated Damages, if any, on the Notes on the dates and
in the manner provided in this Indenture and the Notes. Principal, premium, if
any, and interest and Liquidated Damages, if any, will be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium and Liquidated Damages, if any, and interest then due.
The Company will pay all Liquidated Damages, if any, in the same manner on the
dates and in the amounts set forth in the Registration Rights Agreement.
The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest and
Liquidated Damages , if any, (without regard to any applicable grace period) at
the same rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, the City of New
York, an office or agency (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 will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
fails to maintain any such required office or agency or fails to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.
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 will 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 will 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.
39
Section 4.03 Reports.
Whether or not required by the SEC, so long as any notes are
outstanding, the Company will furnish to the holders of notes all quarterly and
annual financial information that would be required to be contained in a filing
with the SEC on Forms 10-Q and 10-K if the Company were required to file such
Forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual information only, a
report by the Company's certified independent accountants.
In addition, whether or not required by the rules and regulations of
the SEC, the Company will submit a copy of all such information with the SEC for
public availability (unless the SEC will not accept such a submission) and file
such information with the trustee and make such information available to
investors and securities analysts who request it in writing. In addition, for so
long as the notes are outstanding, the Company will continue to provide to
holders and to prospective purchasers of notes the information required by Rule
144(d)(4).
If the Company has designated any of its Subsidiaries as Unrestricted
Subsidiaries, then the quarterly and annual financial information required by
the preceding paragraph will include a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, and in
Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of the Company
and its Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Company.
Section 4.04 Compliance Certificate.
(a) The Company shall deliver to the Trustee, within 60 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 has 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, if any, 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 any of the Notes are outstanding, the Company will 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 Taxes.
The Company will pay, and will cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
40
Section 4.06 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will 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 and each of the Guarantors
(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and covenants that it will not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law has been enacted.
Section 4.07 Restricted Payments.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly:
(1) declare or pay any dividend or make any distribution on
account of the Company's or any of its Restricted Subsidiaries' Equity
Interests (other than: (1) dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company; or (2)
dividends or distributions by a Restricted Subsidiary of the Company,
provided that to the extent that a portion of such dividend or
distribution is paid to a holder of Equity Interests of a Restricted
Subsidiary other than the Company or a Restricted Subsidiary, such
portion of such dividend or distribution is not greater than such
holder's pro rata aggregate common equity interest in such Restricted
Subsidiary);
(2) purchase, redeem or otherwise acquire or retire for value
any Equity Interests of the Company or any Restricted Subsidiary or
other Affiliate of the Company (other than (A) any Equity Interests
owned by the Company or any Wholly Owned Restricted Subsidiary of the
Company and (B) pursuant to transactions otherwise constituting
Permitted Investments hereunder);
(3) purchase, redeem or otherwise acquire or retire for value
any Indebtedness of the Company or any Restricted Subsidiary that is
subordinated or junior in right of payment, by its terms, to the notes
or any Guarantee thereof prior to the scheduled final maturity or
sinking fund payment dates for payment of principal and interest in
accordance with the original documentation for such subordinated or
junior Indebtedness; or
(4) make any Restricted Investment (all such payments and
other actions set forth in clauses (1) through (4) above being
collectively referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(l) no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment;
(2) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period,
have been permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Fixed Charge Coverage Ratio test set forth in Section
4.09; and
(3) such Restricted Payment, together with the aggregate of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date of this Indenture
41
(excluding Restricted Payments permitted by clauses (2), (3), (4) and
(5) of the next succeeding paragraph), is less than the sum, without
duplication, of:
(a) 50% of the Consolidated Net Income of the Company for
the period (taken as one accounting period) from January 1,
1996 to the end of the Company's most recently ended fiscal
quarter for which internal financial statements are available
at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less
100% of such deficit; plus
(b) 100% of the aggregate net cash proceeds received by
the Company from the issue or sale, in either case, since
January 1, 1996, of either (A) Equity Interests of the Company
or of (B) debt securities of the Company that have been
converted or exchanged into such Equity Interests (other than
Equity Interests (or convertible or exchangeable debt
securities) sold to a Restricted Subsidiary of the Company and
other than Disqualified Stock or debt securities that have
been converted or exchanged into Disqualified Stock); plus
(c) in case any Unrestricted Subsidiary has been
redesignated a Restricted Subsidiary and becomes a Guarantor
pursuant to the terms of this Indenture or has been merged,
consolidated or amalgamated with or into, or transfers or
conveys assets to, or is liquidated into, the Company or a
Restricted Subsidiary that is a Guarantor, and provided that
no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof, the lesser
of (A) the book value (determined in accordance with GAAP) at
the date of such redesignation, combination or transfer of the
aggregate Investments made by the Company and its Restricted
Subsidiaries in such Unrestricted Subsidiary (or of the assets
transferred or conveyed, as applicable) and (B) the fair
market value of such Investment in such Unrestricted
Subsidiary at the time of such redesignation, combination or
transfer (or of the assets transferred or conveyed, as
applicable), in each case as determined in good faith by the
Board of Directors of the Company, whose determination shall
be conclusive and evidenced by a resolution of such Board and,
in each case, after deducting any Indebtedness associated with
the Unrestricted Subsidiary so designated or combined or with
the assets so transferred or conveyed; plus
(d) 50% of any dividends or interest actually received in
cash by the Company or a Restricted Subsidiary that is a
Guarantor after the date of this Indenture from (A) a
Restricted Subsidiary the Net Income of which has been
excluded from the computation of Consolidated Net Income, (B)
an Unrestricted Subsidiary, (C) a Person that is not a
Subsidiary or (D) a Person that is accounted for on the equity
method; plus
(e) $25.0 million; minus
(f) the aggregate amount of all Restricted Payments made
by the Company and its Restricted Subsidiaries from and after
January 1, 1996 and on or before the date of this Indenture.
To the extent that any Restricted Investment made since January 1, 1996
is sold for cash or Cash Equivalents or otherwise liquidated or repaid for cash
after the date of this Indenture, the lesser of (A) the cash return of capital
with respect to such Restricted Investment less the cost of disposition, if any,
and (B) the aggregate amount of the Investment made by the Company or a
Restricted Subsidiary in such Restricted Investment shall not, following such
sale, liquidation or repayment, be counted in the
42
calculation of the aggregate amount of Restricted Payments made by the Company
or its Restricted Subsidiaries for purposes of this clause (3).
The preceding provisions will not prohibit:
(1) the payment of any dividend within 60 days after the date
of declaration thereof, if at said date of declaration such payment
would have complied with the provisions of this Indenture;
(2) the redemption, purchase, retirement or other acquisition
of any Equity Interests of the Company in exchange for, or out of the
proceeds of, the substantially concurrent sale (other than to a
Restricted Subsidiary of the Company) of other Equity Interests of the
Company (other than any Disqualified Stock); provided that the amount
of any proceeds that is utilized for such redemption, repurchase,
retirement or other acquisition shall be excluded from clause (3)(b)
above;
(3) the defeasance, redemption, repayment or purchase of
Indebtedness of the Company or any Restricted Subsidiary that is
subordinated or junior in right of payment, by its terms, to the notes
or any Guarantee thereof in a Permitted Refinancing;
(4) the defeasance, redemption, repayment or purchase of
Indebtedness of the Company or any Restricted Subsidiary that is
subordinated or junior in right of payment, by its terms, to the notes
or any Guarantee thereof with the proceeds of a substantially
concurrent sale (other than to a Subsidiary of the Company) of Equity
Interests (other than Disqualified Stock) of the Company; provided that
the amount of any proceeds that is utilized for such defeasance,
redemption, repayment or purchase shall be excluded from clause (3)(b)
above; or
(5) the purchase, redemption or other acquisition or
retirement for value of any Equity Interests of the Company pursuant to
any management equity subscription agreement or stock option agreement;
provided, however, that the aggregate price paid for all such
purchased, redeemed, acquired or retired Equity Interests shall not
exceed $1.0 million per year,
provided that, in the case of clauses (2) through (5) above, no Default or Event
of Default shall have occurred and be continuing or would occur as a consequence
thereof.
In determining whether any Restricted Payment is permitted by the
foregoing covenant, the Company may allocate or reallocate all or any portion of
such Restricted Payment among the clauses (1) through (5) above or among such
clauses and the first paragraph of this covenant including clauses (1), (2) and
(3), provided that at the time of such allocation or reallocation, all such
Restricted Payments, or allocated portions thereof, would be permitted under the
various provisions of the foregoing covenant.
The amount of all Restricted Payments (other than cash) shall be the
fair market value (as determined by the Board of Directors of the Company and
evidenced by a resolution of the Board of Directors of the Company set forth in
an officers' certificate delivered to the trustee) on the date of the Restricted
Payment of the asset(s) proposed to be transferred by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
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 covenant were computed, which calculations may be based upon
the Company's latest available financial statements.
43
Section 4.08 Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(1) (i) pay dividends or make any other consensual
distributions to the Company or any of its Restricted Subsidiaries (A)
on its Capital Stock or (B) with respect to any other interest or
participation in, or measured by, its profits, or (ii) pay any
Indebtedness owed to the Company or any of its Restricted Subsidiaries;
(2) make loans or advances or capital contributions to the
Company or any of its Restricted Subsidiaries; or
(3) sell, lease or transfer any of its properties or assets to
the Company or any of its Restricted Subsidiaries.
However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:
(1) Existing Indebtedness as in effect on the date of this
Indenture;
(2) this Indenture and the notes;
(3) applicable law;
(4) any instrument governing Indebtedness or Capital Stock of
a Person acquired by the Company or any of its Restricted Subsidiaries
or of any Person that becomes a Restricted Subsidiary as in effect at
the time of such acquisition or such Person becoming a Restricted
Subsidiary (except to the extent such Indebtedness was incurred in
connection with or, if incurred within one year prior to such
acquisition or such Person becoming a Restricted Subsidiary, in
contemplation of such acquisition or such Person becoming a Restricted
Subsidiary), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any Person, other than the
Person, or the property or assets of the Person, so acquired, provided
that the Consolidated Cash Flow of such Person is not taken into
account (to the extent of such restriction) in determining whether such
acquisition was permitted by the terms of this Indenture;
(5) any instrument governing Indebtedness or Capital Stock of
a Person who becomes a Guarantor as in effect at the time of becoming a
Guarantor (except to the extent such Indebtedness was incurred in
connection with or, if incurred within one year prior to the time of
becoming a Guarantor, in contemplation of such Guarantee), which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person who became a Guarantor;
(6) by reason of customary non-assignment provisions in leases
entered into in the ordinary course of business and consistent with
past practices;
(7) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions of the nature
described in clause (3) of the first paragraph of this Section 4.08 on
the property so acquired;
44
(8) permitted Refinancing Indebtedness, provided that the
restrictions contained in the agreements governing such Refinancing
Indebtedness are no more restrictive than those contained in the
agreements governing the Indebtedness being refinanced;
(9) customary restrictions in security agreements or mortgages
securing Indebtedness of a Restricted Subsidiary to the extent such
restrictions restrict the transfer of the property subject to such
security agreements and mortgages;
(10) any agreement for the sale or other disposition of a
Subsidiary that restricts distributions by that Subsidiary pending its
sale or other disposition;
(11) Liens securing Indebtedness otherwise permitted to be
incurred under the provisions of Section 4.12 that limit the right of
the debtor to dispose of the assets subject to such Liens:
(12) provisions with respect to the disposition or
distribution of assets or property in joint venture agreements, assets
sale agreements, stock sale agreements and other similar agreements
entered into in the ordinary course of business; or
(13) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business.
Section 4.09 Incurrence of Indebtedness and Issuance of Certain Capital Stock.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable with respect to (collectively, "incur" and
correlatively, an "incurrence" of) any Indebtedness (including Acquired Debt),
that the Company will not issue any shares of Disqualified Stock and that the
Company will not permit any of its Restricted Subsidiaries to issue any
Preferred Stock, provided, however, that the Company may incur Indebtedness or
issue shares of Disqualified Stock and its Restricted Subsidiaries may issue
Preferred Stock, if the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date on which such additional
Indebtedness is incurred or such Disqualified Stock or Preferred Stock is issued
would have been at least 2.0 to 1, determined on a pro forma basis (including a
pro forma application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred, or the Disqualified Stock or Preferred Stock had
been issued, as the case may be, at the beginning of such four-quarter period.
The first paragraph of this covenant will not prohibit the incurrence
of any of the following items of Indebtedness (collectively, "Permitted Debt"):
(l) the incurrence by the Company's Unrestricted Subsidiaries
of Non-Recourse Indebtedness; provided, however, that if any such
Indebtedness ceases to be Non-Recourse Indebtedness of an Unrestricted
Subsidiary, such event shall be deemed to constitute an incurrence of
Indebtedness by a Restricted Subsidiary of the Company;
(2) the incurrence by the Company or its Restricted
Subsidiaries of Indebtedness pursuant to a Credit Facility in an
aggregate principal amount not to exceed $150.0 million at any one time
outstanding, plus up to an additional $50.0 million in aggregate
principal amount of Indebtedness at any one time outstanding that may
be incurred from time to time, pursuant to one or more Credit
Facilities, minus the aggregate amount of all proceeds of all sales or
other dispositions of assets that have been applied to permanently
reduce the outstanding amount of such Indebtedness pursuant to clause
(1) of the second paragraph of Section 4.10;
45
(3) the incurrence by the Company and its Restricted
Subsidiaries of Existing Indebtedness;
(4) Hedging Obligations that are incurred for the purpose of
fixing or hedging interest rate risk with respect to any floating rate
Indebtedness that is permitted by the terms of this Indenture to be
outstanding or required by the terms of Credit Facilities to be
outstanding;
(5) the incurrence or the issuance by the Company of
Refinancing Indebtedness or Refinancing Disqualified Stock of the
Company or any Restricted Subsidiary or the incurrence or issuance by a
Restricted Subsidiary of Refinancing Indebtedness or Refinancing
Disqualified Stock of such Restricted Subsidiary, as the case may be;
provided, however, that such Refinancing Indebtedness or Refinancing
Disqualified Stock, as the case may be, is a Permitted Refinancing;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company
and any of its Restricted Subsidiaries; provided, however, that (a) any
subsequent issuance or transfer of Equity Interests that results in any
such Indebtedness being held by a Person other than a Restricted
Subsidiary and (b) any sale or other transfer of any such Indebtedness
to a Person that is not either the Company or a Restricted Subsidiary
shall be deemed, in each case, to constitute an incurrence of such
Indebtedness by the Company or such Restricted Subsidiary, as the case
may be;
(7) the incurrence of Indebtedness represented by the notes
and any Guarantee thereof;
(8) the incurrence by the Company or any of its Restricted
Subsidiaries, in the ordinary course of business and consistent with
past practice, of Indebtedness to secure performance bonds not to
exceed $30.0 million at any one time outstanding; or
(9) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness (in addition to Indebtedness permitted by
any other clause of this paragraph) in an aggregate principal amount at
any time outstanding not to exceed $20.0 million; provided that the net
proceeds of such Indebtedness are used to finance the renovation or
refurbishment of properties owned by the Company or a Restricted
Subsidiary which are employed in a Hospitality-Related Business.
In the event any Restricted Subsidiary of the Company becomes a
guarantor of the Company's 9 1/4% First Mortgage Notes due 2006 (the "First
Mortgage Notes") pursuant to the subsidiary guarantee provisions of this
Indenture with respect thereto as in effect on the date of this Indenture, such
Guarantee shall not be deemed a separate incurrence of the underlying
Indebtedness represented by the First Mortgage Notes for purposes of this
covenant.
For purposes of determining compliance with this "Incurrence of
Indebtedness and Issuance of Capital Stock" covenant, in the event that an item
of proposed Indebtedness meets the criteria of more than one of the categories
of Permitted Debt described in clauses (1) through (9) above, or is entitled to
be incurred pursuant to the first paragraph of this covenant, the Company will
be permitted to classify such item of Indebtedness on the date of its
incurrence, or later reclassify all or a portion of such item of Indebtedness,
in any manner that complies with this covenant. Indebtedness under Credit
Facilities outstanding on the date on which notes are first issued and
authenticated under this Indenture will be deemed to have been incurred on such
date in reliance on the exception provided by clause (2) of the definition of
Permitted Debt.
46
Section 4.10 Asset Sales.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company (or the Restricted Subsidiary, as the case may
be) receives consideration at the time of such Asset Sale at least
equal to the fair market value of the assets or otherwise disposed of
(the fair market value to be determined by the Company's Board of
Directors and evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee); and
(2) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents provided, however, that the principal amount of the
following shall be deemed to be cash for purposes of this provision:
(A) any liabilities (as shown on the Company's or
such Restricted Subsidiary's most recent balance sheet or in
the notes thereto), of the Company or any Restricted
Subsidiary (other than liabilities that are by their terms
subordinated to the Notes or any Guarantee thereof) that are
assumed or forgiven by the transferee of any such assets; and
(B) any notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee
that are converted by the Company or such Restricted
Subsidiary into cash within 90 days of the closing of such
Asset Sale (to the extent of the cash).
Notwithstanding the foregoing, the restriction in clause (2) above will
not apply with respect to mortgages or other notes receivable received by the
Company or any Restricted Subsidiary from a transferee of any assets to the
extent such mortgages or other notes receivable are Restricted Investments
permitted to be made by the Company or such Restricted Subsidiary under Section
4.07.
Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, the Company :
(1) apply the Net Proceeds from such Asset Sale to prepay any
Indebtedness that ranks by its terms senior to the notes (or any
Guarantee thereof) and, in the case of any Indebtedness under a
revolving Credit Facility, to effect a permanent reduction in the
amount of Indebtedness that may be incurred pursuant to clause (2) of
the second paragraph of the covenant entitled "Incurrence of
Indebtedness and Issuance of Certain Capital Stock," or
(2) invest the Net Proceeds from such Asset Sale in property
or assets used in a Hospitality-Related Business; provided that the
Company or such Restricted Subsidiary will have complied with this
clause (2) if, within 365 days of such Asset Sale, the Company or such
Restricted Subsidiary shall have commenced and not completed or
abandoned an investment in compliance with this clause (2) and shall
have segregated such Net Proceeds from the general funds of the Company
and its Subsidiaries for that purpose and such Investment is
substantially completed within 180 days after the first anniversary of
such Asset Sale.
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest such Net
Proceeds in any manner that is not prohibited by this Indenture.
47
Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph will constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $25.0 million, the Company will make
an offer to all Holders of Notes and other Indebtedness that ranks by its terms
pari passu in right of payment with the Notes and the terms of which containing
substantially similar requirements with respect to the application of net
proceeds from assets sales in accordance with Section 3.09 (an "Asset Sale
Offer") to purchase on a pro rata basis the maximum principal amount of Notes
and such other pari passu Indebtedness, that is an integral multiple of $1,000,
that may be purchased out of the Excess Proceeds. The offer price in any Asset
Sale Offer will be cash equal to 100% of principal amount plus accrued and
unpaid interest and Liquidated Damages, if any, to the date of purchase. If any
Excess Proceeds remain after consumption of an Asset Sale Offer, the Company may
use such Excess Proceeds for general corporate purposes. If the aggregate
principal amount of Notes and such other pari passu Indebtedness tendered into
such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall
select the Notes and such other pari passu Indebtedness to be purchased in the
manner described under Sections 3.02 and 3.03. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
Sections 3.09 or 4.10 of this Indenture, the Company will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under those provisions of this Indenture by virtue of
such conflict.
Section 4.11 Transactions with Affiliates.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
any contract, agreement, understanding, loan, advance or Guarantee with, or for
the benefit of, any Affiliate (each of the foregoing, an "Affiliate
Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary on an arm's length basis with an
unrelated Person; and
(2) the Company delivers to the trustee:
(a) with respect to any Affiliate Transaction involving
aggregate payments in excess of $5.0 million, an officers'
certificate certifying that such Affiliate Transaction
complies with clause (1) above and such Affiliate Transaction
is approved by a majority of the disinterested non-employee
members of the Board of Directors;
(b) with respect to any Affiliate Transaction involving
aggregate payments in excess of $10.0 million (other than an
Affiliate Transaction involving the acquisition or disposition
of a hotel by the Company or a Restricted Subsidiary of the
Company), an opinion as to the fairness to the Company or such
Restricted Subsidiary from a financial point of view issued,
at the option of the Company, by an investment banking firm of
national standing or a real estate appraisal firm of
recognized standing (a "Qualified Appraiser"); and
48
(c) with respect to any Affiliate Transaction involving
the acquisition or disposition of a hotel by the Company or a
Restricted Subsidiary of the Company and (x) involving
aggregate payments of less than $25.0 million, an appraisal by
a Qualified Appraiser to the effect that the transaction is
being undertaken at fair market value or (y) involving
aggregate payments of $25.0 million or more, an opinion as to
the fairness of the transaction to the Company or such
Restricted Subsidiary from a financial point of view issued by
an investment banking firm of national standing.
The following items will not be deemed to be Affiliate Transactions
and, therefore, will not be subject to the provisions of the prior paragraph:
(1) any employment, deferred compensation, stock option,
noncompetition, consulting or similar agreement entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of
business and consistent with the past practice of the Company or such
Restricted Subsidiary;
(2) transactions between or among the Company and/or its
Restricted Subsidiaries;
(3) the incurrence of fees in connection with the provision of
hotel management services, provided that such fees are paid in the
ordinary course of business and are consistent with past practice; and
(4) Restricted Payments permitted by the provisions of this
Indenture described above under Section 4.07.
Section 4.12 Liens.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to exist any Lien of any
kind securing Indebtedness or trade payables on any asset now owned or hereafter
acquired, except Permitted Liens.
Section 4.13 Line of Business.
So long as any notes are outstanding, the Company will not, and will
not permit any of its Restricted Subsidiaries to, engage in any business or
activity other than a Hospitality-Related Business.
Section 4.14 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:
(1) its corporate existence, and the corporate, partnership or
other existence of 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
(2) 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 any
of its Subsidiaries, if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Subsidiaries,
49
taken as a whole, and that the loss thereof is not adverse in any
material respect to the Holders of the Notes.
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Company will make
an offer (a "Change of Control Offer") to each Holder to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of each Holder's Notes
at a purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest and Liquidated Damages on the Notes repurchased, if
any, to the date of purchase (the "Change of Control Payment"). Within 30 days
following any Change of Control, the Company must send, by first class mail, a
notice to each Holder, with a copy to the Trustee, describing the transaction or
transactions that constitute the Change of Control and stating:
(1) that the Change of Control Offer is being made pursuant to
this Section 4.15 and that all Notes tendered will be accepted for
payment;
(2) the purchase price and the purchase date, which shall be
no earlier than 30 days nor later than 45 days from the date such
notice is mailed, other than as may be required by law (the "Change of
Control Payment Date");
(3) that any Note not tendered will continue to accrue
interest;
(4) that, unless the Company defaults in the payment of the
Change of Control Payment, all Notes accepted for payment pursuant to
the Change of Control Offer will cease to accrue interest after the
Change of Control Payment Date;
(5) that Holders electing to have any Notes purchased pursuant
to a Change of Control Offer will be required to surrender the Notes,
with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the close of business on
the second Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Notes delivered for
purchase, and a statement that such Xxxxxx is withdrawing his election
to have the Notes purchased; and
(7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered, which unpurchased portion must be
equal to $1,000 in principal amount or an integral multiple thereof.
Prior to the mailing of the notice described in paragraph (a) above,
but in any event within 30 days following a Change of Control, the Company will
either repay in full and terminate all commitments under Credit Facilities and
all other Senior Debt the terms of which require repayment upon a Change of
Control or offer to repay in full and terminate all commitments under all
Indebtedness under Credit Facilities and all other such Senior Debt and to repay
the Indebtedness owed to each lender or holder of Senior Debt which has accepted
such offer; or obtain the requisite consents under all Credit Facilities and all
other Senior Debt to permit the repurchase of Notes required by this Section
4.15. The Company shall first comply with the covenant in the immediately
preceding sentence before it shall be required to repurchase the Notes as
provided below and the Company's failure to comply with the covenant describe
50
in the immediately preceding sentence shall constitute an Event of Default
described in clause (3) and not in clause (2) under Section 6.01.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of Sections 3.09 or 4.15 of this Indenture, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under Section 3.09 or this Section 4.15 by virtue
of such conflict.
(b) On the Change of Control Payment Date, the Company will, to the
extent lawful:
(1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the
Change of Control Payment in respect of all Notes or portions of Notes
properly tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes
so accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being
purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes properly
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 new Note will be in a
principal amount of $1,000 or an integral multiple thereof. The Company will
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.
(c) 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
Section 4.15 and Section 3.09 hereof and purchases all Notes properly tendered
and not withdrawn under the Change of Control Offer.
Section 4.16 Anti-Layering.
The Company will not incur, issue, assume or otherwise become liable
for any Indebtedness that is senior in right of payment to the notes and
subordinate in right of payment to any other Indebtedness of the Company and no
Guarantor will incur, create, issue, assume, guarantee or otherwise become
liable for any Indebtedness that is senior in right of payment to the Guarantee
by such Guarantor of the notes and subordinate or junior in right of payment to
any other Indebtedness of the Guarantor.
Section 4.17 Subsidiary Guarantees.
If (i) the Company or any Restricted Subsidiary shall transfer or cause
to be transferred, in one or a series of related transactions, any assets
(including cash or Cash Equivalents other than pursuant to clause (e) of the
definition of Permitted Investments), business, divisions, real property or
equipment having a book value or fair market value (as determined in good faith
by the Board of Directors of the Company, whose determination shall be
conclusive and evidenced by a resolution of such Board) in
51
excess of $10.0 million to any Restricted Subsidiary that is not a Guarantor or
(ii) if the Company or any of its Restricted Subsidiaries shall acquire or
create after the Issuance Date another Restricted Subsidiary having total assets
with a fair market value in excess of $10.0 million at the time of such
acquisition or creation, the Company shall cause such Restricted Subsidiary to
execute and deliver to the Trustee a supplemental indenture in the form of
Exhibit E hereto pursuant to which such Restricted Subsidiary shall guarantee
all of the obligations of the Company with respect to the Notes on an unsecured
senior subordinated basis together with an Opinion of Counsel to the effect that
the supplemental indenture has been duly executed and delivered by such
Restricted Subsidiary and is in compliance in all material respects with the
terms of this Indenture.
The Indebtedness represented by any such Subsidiary Guarantee (i.e.,
the payment of Obligations on the Notes) will be subordinated on the same basis
to Senior Debt of the Guarantor as the Notes are subordinated to Senior Debt of
the Company.
Section 4.18 Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if such designation would not cause a Default or Event
of Default. For purposes of making the determination as to whether such
designation would cause a Default or Event of Default, 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 Section 4.07. All such
outstanding Investments will be deemed to constitute Investments in an amount
equal to the greatest of (x) the net book value of such Investments at the time
of such designation, (y) the fair market value of such Investments at the time
of such designation and (z) the original fair market value of such Investments
at the time they were made. Such designation will only be permitted if such
Restricted Payment would be permitted at such time and if such Restricted
Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
Any such designation by the Board of Directors shall be evidenced to
the Trustee by filing with the Trustee a certified copy of the resolution of the
Board of Directors of the Company giving effect to such designation and an
officers certificate certifying that such designation complied with the
foregoing conditions.
Section 4.19 Convertible Note Indenture
Without the consent of at least 75% in aggregate principal amount of
the Notes outstanding, the Company shall not amend, modify or alter the
indenture (the "Convertible Note Indenture") governing its 7% Convertible
Subordinated Notes due 2002 (the "Convertible Notes") in any way that will (i)
increase the rate of or change the time for payment of interest on any
Convertible Notes, (ii) increase the principal of, advance the final maturity
date of or shorten the Weighted Average Life to Maturity of any Convertible
Notes, (iii) alter the redemption provisions or the price or terms at which the
Company is required to offer to purchase such Convertible Notes or (iv) amend
the provisions of Article Twelve of the Convertible Note Indenture which relate
to subordination.
Section 4.20 Payments for Consent.
Neither the Company nor any of its Subsidiaries will, 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
52
the notes unless such consideration is offered to be paid or agreed to be paid
to all holders of the notes that consent, waive or agree to amend in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
The Company shall not, directly or indirectly, consolidate or merge
with or into another Person (whether or not the Company is the surviving
corporation), or sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company and its
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; unless:
(1) 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, lease,
conveyance or other disposition shall have been make is a corporation
organized or existing under the laws of the United States, any state
thereof or the District of Columbia;
(2) the Person formed by or surviving any such consolidation
or merger (if other than the Company) or the Person or to which such
sale, assignment, transfer, lease, conveyance or other disposition will
have been made assumes all the obligations of the Company under the
Notes and this Indenture pursuant to a supplemental indenture;
(3) immediately after such transaction after giving pro forma
effect thereto, no Default or Event of Default exists;
(4) the Company or any Person formed by or surviving any such
consolidation or merger, or to which such sale, assignment, transfer,
conveyance or other disposition has been made:
(A) would have Consolidated Net Worth immediately
after the transaction equal to or greater than the
Consolidated Net Worth of the Company immediately preceding
the transaction; and
(B) would, on the date of such transaction after
giving pro forma effect thereto as if such transaction had
occurred at the beginning of the applicable four-quarter
period, be permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in Section 4.09(a) hereof.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor Person 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 Person and not to the Company), and may exercise every right and
power of the Company under this Indenture with the same
53
effect as if such successor Person had been named as the Company herein and the
predecessor Company shall be relieved of all further obligations and covenants
under this Indenture and the Notes.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following is an "Event of Default":
(1) the Company defaults for 30 days in the payment when due
of interest on the Notes whether or not prohibited by the subordination
provisions of this Indenture;
(2) default in payment when due of principal of or premium, if
any, on the Notes at maturity, upon redemption or otherwise (including
the failure to make a payment to purchase Notes tendered pursuant to a
Change of Control Offer or an Assets Sale Offer) (whether or not such
payment shall be prohibited by the subordination provisions of this
Indenture);
(3) failure by the Company or any Restricted Subsidiary to
comply with Section 4.15 (other than a failure to make a payment to
purchase Notes pursuant thereto, which failure shall be an Event of
Default pursuant to clause (2) above), 4.10 (other than a failure to
make a payment to purchase Notes pursuant thereto, which failure shall
be an Event of Default pursuant to clause (2) above), 4.07, 4.09 and
5.01, which failure continues for a period of 30 days after written
notice shall have been given to the Company by the Trustee or to the
Company and the Trustee from Holders of at least 25% in principal
amount of the Notes then outstanding;
(4) failure by the Company or any Guarantor for 60 days in the
performance of any other covenant, warranty or agreement in this
Indenture or the Notes after written notice shall have been given to
the Company by the Trustee or to the Company and the Trustee from
Holders of at least 25% in principal amount of the Notes then
outstanding;
(5) the failure to pay at final stated maturity (giving effect
to any applicable grace periods and any extensions thereof) the
principal amount of Non-Recourse Indebtedness of the Company or any of
its Restricted Subsidiaries with an aggregate principal amount in
excess of the lesser of (A) 10% of the total assets of the Company and
its Restricted Subsidiaries measured as of the end of the Company's
most recent fiscal quarter for which internal financial statements are
available immediately preceding the date on which such default
occurred, determined on a pro forma basis and (B) $100 million, and
such failure continues for a period of 10 days or more, or the
acceleration of the final stated maturity of any such Non-Recourse
Indebtedness (which acceleration is not rescinded, annulled or
otherwise cured within 10 days of receipt by the Company or such
Restricted Subsidiary of notice of any such acceleration);
(6) the failure to pay at final stated maturity (giving effect
to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness (other than Non-Recourse
Indebtedness) of the Company or any Restricted Subsidiary of the
Company and such failure continues for a period of 10 days or more, or
the acceleration of the final stated maturity of any such Indebtedness
(which acceleration is not rescinded, annulled or otherwise cured
within 10 days of receipt by the Company or such Restricted Subsidiary
of notice of any such acceleration) if the aggregate principal amount
of such Indebtedness, together with the principal amount of any other
such Indebtedness in default for failure to pay principal at final
maturity or
54
which has been accelerated, in each case with respect to which the
10-day period described above has passed, aggregates $20.0 million or
more at any time;
(7) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments rendered against them (other than
judgment liens without recourse to any assets or property of the
Company or any of its Restricted Subsidiaries other than assets or
property securing Non-Recourse Indebtedness) aggregating in excess of
$20.0 million, which judgments are not paid, discharged or stayed for a
period of 90 days (other than any judgments as to which a reputable
insurance company has accepted full liability);
(8) except as permitted by this Indenture, any Subsidiary
Guarantee shall be held in a judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or
any Guarantor (or its successors or assigns), or any Person acting on
behalf of such Guarantor (or its successors or assigns), shall deny or
disaffirm its obligations or shall fail to comply with any obligations
under its Subsidiary Guarantee;
(9) the Company, any Guarantor or any of the Company's
Subsidiaries that would constitute a Significant Subsidiary or any
group of the Company's Subsidiaries that, taken together, would
constitute a Significant Subsidiary pursuant to or within the meaning
of the Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief
against it in an involuntary case,
(c) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(d) makes a general assignment for the benefit of its
creditors, or
(e) admits in writing its inability to pay its debts
as they become due; and
(10) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(a) is for relief in an involuntary case against the
Company, any Guarantor or any Subsidiary that is a Significant
Subsidiary of the Company or any group of Subsidiaries that,
taken together, would constitute a Significant Subsidiary of
the Company,
(b) appoints a Custodian of the Company, any
Guarantor or any Subsidiary that is a Significant Subsidiary
of the Company or any group of Subsidiaries that, taken
together, would constitute a Significant Subsidiary of the
Company, or for all or substantially all of the property of
the Company, any Guarantor or any Subsidiary that is a
Significant Subsidiary of the Company, or any group of
Subsidiaries that, taken together, would constitute a
Significant Subsidiary of the Company, or
(c) orders the liquidation of the Company, any
Guarantor or any Subsidiary that is a Significant Subsidiary
of the Company or any group of Subsidiaries that, taken
together, would constitute a Significant Subsidiary of the
Company,
and the order or decree remains unstayed and in
effect for 60 consecutive days.
55
Section 6.02 Acceleration.
In the case of an Event of Default specified in clause (9) or (10) of
Section 6.01 hereof, with respect to the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, all outstanding Notes will become due and
payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium and Liquidated
Damages, 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 and Liquidated Damages, if any, or interest
on, Notes held by a non-consenting Holder (including 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 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 an aggregate 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
involve the Trustee in personal liability.
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:
(1) the Holder of a Note gives to the Trustee written notice
of a continuing Event of Default or the Trustee receives such notice
from the Company;
56
(2) the Holders of at least 25% in principal amount of the
then outstanding Notes make a written request to the Trustee to pursue
the remedy;
(3) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(5) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Notes do not give the Trustee
a direction inconsistent with the request,
provided, however, that such provision does not affect the right of a
Holder of a Note to sue for enforcement of any overdue payment thereon.
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 and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal of, premium and Liquidated Damages, if any, and interest remaining
unpaid on the Notes and interest on overdue principal and, to the extent lawful,
interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 6.09 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 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
57
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 or receives 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 payment of all compensation,
expense and liabilities incurred, and all advances made, by the Trustee
and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the
Notes for principal, premium and Liquidated Damages, 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 and Liquidated Damages, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes 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 reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder of
a Note pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
aggregate principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
will exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee will 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
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Indenture and no others, and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, the Trustee will examine the certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b)
of this Section 7.01;
(2) the Trustee will not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee will not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 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), and (c) of this Section 7.01.
(e) No provision of this Indenture will require the Trustee to expend
or risk its own funds or incur any liability. The Trustee will be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder has offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee will not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document 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 will 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 written advice of such counsel or any Opinion of Counsel will 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 will not
be responsible for the misconduct or negligence of any agent appointed and
monitored with due care.
(d) The Trustee will 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.
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(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company will be sufficient if
signed by an Officer of the Company.
(f) The Trustee will be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
Section 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC 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 will 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 will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will 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 will mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium or
Liquidated Damages, 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. The Trustee shall comply with TIA Section 315(b).
Section 7.06 Reports by Trustee to Holders of the Notes.
(a) Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee will mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA ss. 313(a) (but if no
event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
will comply with TIA ss. 313(b)(2). The Trustee will also transmit by mail all
reports as required by TIA ss. 313(c).
(b) A copy of each report at the time of its mailing to the Holders of
Notes will be mailed by the Trustee to the Company and filed by the Trustee with
the SEC and each stock exchange on which the Notes are listed in accordance with
TIA ss. 313(d). The Company will promptly notify the Trustee when the Notes are
listed on or delisted from any stock exchange.
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Section 7.07 Compensation and Indemnity.
(a) The Company will pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation will not be limited by any law on compensation of a
trustee of an express trust. The Company will 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 will
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
(b) The Company will indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, except to the
extent any such loss, liability or expense may be attributable to its negligence
or bad faith. The Trustee will notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee to so notify the Company
will not relieve the Company of its obligations hereunder, except to the extent
the Company has been prejudiced thereby. The Company will defend the claim and
the Trustee will cooperate in the defense. The Trustee may have separate counsel
and the Company will pay the reasonable fees and expenses of such counsel.
Neither the Company nor any Guarantor need pay for any settlement made without
its consent, which consent will not be unreasonably withheld.
(c) The obligations of the Company under this Section 7.07 will survive
the satisfaction and discharge of this Indenture.
(d) To secure the Company's payment obligations in this Section 7.07,
the Trustee will 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 will survive the satisfaction and
discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(7) or (8) hereof occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
(f) The Trustee will comply with the provisions of TIAss. 313(b)(2) to
the extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee will become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
(b) The Trustee may resign in writing at any time and be discharged
from the trust hereby created by so notifying the Company, provided such notice
is delivered to the Company at least 30 days prior to the date of the proposed
resignation. The Holders of a majority in aggregate 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 at its discretion or, if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(3) a custodian or public officer takes charge of the Trustee
or its property; or
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(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company will promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
(d) If a successor Xxxxxxx does not take office within 30 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company,
or the Holders 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.
(e) Subject to the provisions of TIA ss.315(e), if the Trustee, after
written request by any Holder who has been a bona fide Holder for at least six
months, fails to comply with Section 7.10, such Xxxxxx may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
(f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee will mail a notice of its succession
to Holders. The retiring Trustee will 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 will continue for the
benefit of the retiring Trustee.
Section 7.09 Successor Trustee by Xxxxxx, etc.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act will be the successor Trustee.
Section 7.10 Eligibility; Disqualification.
There will 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 will always have a Trustee who satisfies the
requirements of TIA ss. 310(a). The Trustee is subject to TIA ss. 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
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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 will, 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 will be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which will 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 clauses (1) and (2) 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 will survive
until otherwise terminated or discharged hereunder:
(1) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, interest or premium and
Liquidated Damages, if any, on such Notes when such payments are due
from the trust referred to in Section 8.04 hereof;
(2) the Company's obligations with respect to such Notes under
Article 2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations and any Guarantor's
obligations in connection therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Company may exercise its
option under this Section 8.02 notwithstanding the prior exercise of its option
under Section 8.03 hereof.
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 will, 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 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.18, 4.19, hereof, Section 5.01 and Section
11.04 hereof with respect to the outstanding Notes on and after the date the
conditions set forth in Section 8.04 hereof are satisfied (hereinafter,
"Covenant Defeasance"), and the Notes will 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 will continue to be deemed "outstanding" for all other purposes
hereunder (it being understood that such Notes will 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 will
have no liability in respect of any term, condition or
63
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 will 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 will 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(3) hereof will not
constitute Events of Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03 hereof:
(1) the Company must irrevocably deposit with the Trustee, in
trust, for the benefit of the Holders, cash in United States dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as 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 date or on the applicable redemption date, as the case
may be, of such principal or installment of principal of, premium, if
any, interest and Liquidated Damages, if any, on the outstanding Notes;
(2) in the case of an election under Section 8.02 hereof, the
Company has delivered to the Trustee an Opinion of Counsel in the
United States reasonably acceptable to the Trustee confirming that:
(A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling; or
(B) since the date of this Indenture, there has been
a change in the applicable federal income tax law,
in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Holders of the
outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not
occurred;
(3) in the case of an election under Section 8.03 hereof, the
Company must deliver to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders
of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
Covenant Defeasance had not occurred;
(4) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to such
deposit);
(5) such Legal Defeasance or Covenant Defeasance will not
result in a breach or violation of, or constitute a default under, any
material agreement or instrument (other than this
64
Indenture) to which the Company or any of its Subsidiaries is a party
or by which the Company or any of its Subsidiaries is bound;
(6) the Company must deliver to the Trustee an 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 any other creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
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 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
will be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company will 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.
Notwithstanding anything in this Article 8 to the contrary, the Trustee
will 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(1) 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 one year after such
principal, 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) will be
discharged from such trust; and the Holder of such Note will thereafter be
permitted to look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, will 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 will 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.
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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, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
will 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 will 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:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(3) to provide for the assumption of the Company's obligations
to the Holders of the Notes under this Indenture or any Guarantor's
obligations under its Subsidiary Guarantee in the case of a merger,
consolidation or sale of assets involving the Company or such
Guarantor, as applicable, pursuant to Article 5 or Article 11 hereof;
(4) to release a Guarantor in accordance with Section 11.05;
(5) to make any change that would provide any additional
rights or benefits to the Holders of the Notes (including providing for
Subsidiary Guarantees and any supplemental indenture required pursuant
to Section 4.17) or that does not adversely affect the legal rights
hereunder of any Holder of the Note;
(6) to comply with requirements of the SEC in order to effect
or maintain the qualification of this Indenture under the TIA; or
(7) to provide for the issuance of Additional Notes in
accordance with the limitations set forth in this Indenture as of the
date hereof.
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 will 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 will 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 3.09, 4.10 and 4.15 hereof) and the Notes with the consent of the
Holders of at least a majority in principal amount of the Notes (including,
without limitation, Additional Notes, if any) then outstanding voting as a
single class (including, without limitation, consents obtained in connection
with a tender offer or exchange offer for, or purchase of, 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 or Liquidated Damages, 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 voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes).
In addition, any amendment to, or waiver of, the provisions of this
Indenture relating to subordination that adversely affect the rights of the
holders of the notes will require the consent of the holders of at least 75% in
aggregate principal amount of notes then outstanding.
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 will
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 will not be obligated to, enter into such
amended or supplemental Indenture.
It is 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 is sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company will 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, will 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 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):
(1) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of
any Note or alter or waive any of the provisions with respect to the
redemption of the Notes except as provided above with respect to
Sections 3.09, 4.10 and 4.15 hereof;
(3) reduce the rate of or change the time for payment of
interest, including default interest, on any Note;
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(4) waive a Default or Event of Default in the payment of
principal of, or premium or Liquidated Damages, 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
then outstanding Notes and a waiver of the payment default that
resulted from such acceleration);
(5) make any Note payable in money other than that stated in
the Notes;
(6) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes
to receive payments of principal of, or premium or Liquidated Damages,
if any, or interest, on the Notes;
(7) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions; or
(8) waive a redemption payment with respect to any note (other
than a payment required by Section 3.09, 4.10 or 4.15.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes will be
set forth in a amended or supplemental Indenture that complies with the TIA as
then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Note is a continuing consent by the Holder of a Note and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Xxxxxx's Note, even if notation of the consent is not
made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written
notice of revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder. The Company may fix a record
date for determining which Holders must consent to such amendment, supplement or
waiver.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note will not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee will 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. If it does,
the Trustee may, but need not, sign it. The Company may not sign an amendment or
supplemental Indenture until the Board of Directors approves it. In executing
any amended or supplemental indenture, the Trustee will be entitled to receive
and (subject to Section 7.01 hereof) will be fully protected in relying upon, in
addition to the documents required by Section 12.04 hereof, an
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Officers' 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.
The Company agrees, and each Holder by accepting a Note agrees, that
the Indebtedness evidenced by the Notes is subordinated in right of payment, to
the extent and in the manner provided in this Article 10, to the prior payment
in full of all Senior Debt (whether outstanding on the date hereof or hereafter
created, incurred, assumed or guaranteed), and that the subordination is for the
benefit of the holders of Senior Debt.
Section 10.02 Liquidation; Dissolution; Bankruptcy.
Upon any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to creditors upon any
liquidation, dissolution, winding-up, reorganization, assignment for the benefit
of creditors or marshalling of assets of the Company or in a bankruptcy,
reorganization, insolvency, receivership or other similar proceeding relating to
the Company or its property, whether voluntary or involuntary, all Obligations
due upon all Senior Debt shall first be paid in full in cash, or such payment
duly provided for to the satisfaction of the holders of Senior Debt, before any
payment or distribution of any kind or character is made on account of any
Obligations on the Notes, or for the acquisition by the Company or any of its
Subsidiaries of any of the Notes for cash or property or otherwise, and until
all Obligations with respect to Senior Debt are paid in full in cash, any
distribution to which the Holders would be entitled shall be made to the Holders
of Senior Debt (except that Holders of the Notes may receive Permitted Junior
Securities and payments made pursuant to Section 8.02 or Section 8.03).
Section 10.03 Default on Designated Senior Debt.
(a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by declaration or otherwise, of any
principal of, interest on, unpaid drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, any Senior Debt, no
payment of any kind or character shall be made by, or on behalf of, the Company
or any other Person on its behalf with respect to any Obligations on the Notes,
or to acquire any of the Notes for cash or property or otherwise (except that
Holders of Notes may receive Permitted Junior Securities and payments made from
the trust pursuant to Section 8.02 or Section 8.03.
(b) In addition, if any other event of default occurs and is continuing
with respect to any Designated Senior Debt, as such event of default is defined
in the instrument creating or evidencing such Designated Senior Debt, permitting
the holders of such Designated Senior Debt then outstanding to accelerate the
maturity thereof and if the Representative for the respective issue of
Designated Senior Debt gives written notice of the event of default to the
Trustee (a "Default Notice"), then, unless and until all events of default have
been cured or waived or have ceased to exist or the Trustee receives notice from
the Representative for the respective issue of Designated Senior Debt
terminating the Blockage Period (as defined below), during the 179 days after
the delivery of such Default Notice (the "Blockage Period"), neither the Company
nor any of its Subsidiaries shall:
(1) make any payment of any kind or character with respect to
any Obligations on the Notes (except that Holders of Notes may receive
Permitted Junior Securities and payments made
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from the trust pursuant to Section 8.02 or 8.03) or
(2) acquire any of the Notes for cash or property or
otherwise.
Notwithstanding anything herein to the contrary, in no event will a
Blockage Period extend beyond 179 days from the date the payment on the Notes
was due and only one such Blockage Period may be commenced within any 365
consecutive days.
(c) No event of default which existed or was continuing on the date of
the commencement of any Blockage Period with respect to the Designated Senior
Debt shall be, or be made, the basis for the commencement of a second Blockage
Period by the Representative of such Designated Senior Debt whether or not
within a period of 365 consecutive days, unless such event of default shall have
been cured or waived for a period of not less than 90 consecutive days (it being
acknowledged that any subsequent action, or any breach of any financial
covenants for a period commencing after the date of commencement of such
Blockage Period that, in either case, would give rise to an event of default
pursuant to any provisions under which an event of default previously existed or
was continuing shall constitute a new event of default for this purpose).
(d) The Trustee shall be entitled to rely on information regarding
amounts then due and owing on the Senior Debt, if any, received from the holders
of Senior Debt (or their Representatives) or, if such information is not
received from such holders or their Representatives, from the Company and only
amounts included in the information provided to the Trustee shall be paid to the
holders of Senior Debt.
(e) Nothing contained in this Article 10 shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Section 6.02 or to pursue any rights or remedies
hereunder.
Section 10.04 Acceleration of Notes.
If payment of the Notes is accelerated because of an Event of Default,
the Company will promptly notify holders of Senior Debt 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
Obligations with respect to the Notes (other than Permitted Junior Securities
and payments made from any defeasance trust created pursuant to Section 8.01
hereof) at a time when the Trustee or such Holder, as applicable, has actual
knowledge that such payment is prohibited by Section 10.04 hereof, such payment
will be held by the Trustee or such Holder, in trust for the benefit of, and
will be paid forthwith over and delivered, upon written request, to, the holders
of Senior Debt (pro rata to such holders on the basis of the respective amounts
of Senior Debt held by such Holders) or their Representative under the
agreement, indenture or other document (if any) pursuant to which Senior Debt
may have been issued, as their respective interests may appear, for application
to the payment of all Obligations with respect to Senior Debt 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 Debt.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform only those 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 Debt will be read into this Indenture against
the Trustee. The Trustee will not be deemed to owe any fiduciary duty to the
holders of Senior Debt, and will not be liable to any such holders if the
Trustee pays over or distributes to or on behalf of Holders or
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the Company or any other Person money or assets to which any holders of Senior
Debt are then 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 will 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 will not affect the subordination of the Notes to the Senior Debt as
provided in this Article 10.
Section 10.07 Subrogation.
After all Senior Debt is paid in full and until the Notes are paid in
full, Holders of Notes will be subrogated (equally and ratably with all other
Indebtedness pari passu with the Notes) to the rights of holders of Senior Debt
to receive distributions applicable to Senior Debt to the extent that
distributions otherwise payable to the Holders of Notes have been applied to the
payment of Senior Debt. A distribution made under this Article 10 to holders of
Senior Debt 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 Debt. Nothing in this Indenture will:
(1) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of, premium, Liquidated Damages, if any, 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 Debt; 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 Debt to receive
distributions and payments otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay principal of,
premium or interest or Liquidated Damages, if any, 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 Debt to enforce the subordination of
the Indebtedness evidenced by the Notes may 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 Debt, the distribution may be made and the notice given to their
Representative.
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Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee and the Holders of Notes will 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 Debt 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 will not be charged with knowledge of
the existence of any facts that would prohibit 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 has 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 will impair the
claims of, or payments to, the Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Debt 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 Xxxxxx'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 Xxxxxx'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 Representatives are hereby authorized to file an appropriate
claim for and on behalf of the Holders of the Notes.
Section 10.13 Amendments.
The provisions of this Article 10 may not be amended or modified
without the written consent of the holders of all Senior Debt. In addition, any
amendment to, or waiver of, the provisions of this Article 10 that adversely
affects the rights of the Holders of the Notes will require the consent of the
Holders of at least 75% in aggregate principal amount of Notes then outstanding.
ARTICLE 11.
NOTE GUARANTEES
Section 11.01 Guarantee.
(a) The Company's Obligations under the Notes and this Indenture will
be jointly and severally guaranteed by any Restricted Subsidiary which is
required to execute and deliver a supplemental indenture pursuant to Section
4.17 hereof. Subject to this Article 11, any such of the Guarantors hereby,
jointly and severally, unconditionally guarantees on an unsecured senior
subordinated basis to each Holder of a Note authenticated and delivered by the
Trustee and to the Trustee and its successors and assigns, irrespective of the
validity and enforceability of this Indenture, the Notes or the obligations of
the Company hereunder or thereunder, that:
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(1) the principal of, premium and Liquidated Damages, if any,
and interest on the Notes will be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on the Notes, if any,
if lawful, and all other obligations of the Company to the Holders or
the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and
(2) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise.
Failing payment when due of any amount so guaranteed or any performance
so guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the same immediately. Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder are
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.
(c) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, will be reinstated in full
force and effect.
(d) Each Guarantor agrees that it will not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (2) in the event of any declaration of acceleration of
such obligations as provided in Article 6 hereof, such obligations (whether or
not due and payable) will forthwith become due and payable by the Guarantors for
the purpose of this Note Guarantee. The Guarantors will have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Note Guarantee.
Section 11.02 Subordination of Note Guarantee.
The Obligations of each Guarantor under its Note Guarantee pursuant to
this Article 11 will be junior and subordinated to the Senior Debt of such
Guarantor on the same basis as the Notes are junior and subordinated to Senior
Debt of the Company. For the purposes of the foregoing sentence, the Trustee and
the Holders will have the right to receive and/or retain payments by any of the
Guarantors only at such times as they may receive and/or retain payments in
respect of the Notes pursuant to this Indenture, including Article 10 hereof.
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Section 11.03 Limitation on Guarantor Liability.
For purposes of this Article 11 and any Subsidiary Guarantee, each
Guarantor's liability will be that amount from time to time equal to the
aggregate liability of such Guarantor hereunder and thereunder, but shall be
limited to the least of (i) the aggregate amount of the obligations of the
Company under the Notes and this Indenture or (ii) the amount, if any, which
would not have (A) rendered such Guarantor "insolvent" (as such term is defined
in the federal Bankruptcy Code and in the Debtor and Creditor Law of the State
of New York) or (B) left it with unreasonably small capital at the time its
Subsidiary Guarantee was entered into, after giving effect to the incurrence of
existing Indebtedness immediately prior to such time; provided that, it shall be
a presumption in any lawsuit or other proceeding in which a Guarantor is a party
that the amount guaranteed pursuant to the Subsidiary Guarantee is the amount
set forth in clause (i) above unless any creditor, or representative of
creditors of such guarantor, or debtor in possession or trustee in bankruptcy of
the Guarantor, otherwise proves in such a lawsuit that the aggregate liability
of the Guarantor is limited to the amount set forth in clause (ii). In making
any determination as to the solvency or sufficiency of capital of a Guarantor in
accordance with the previous sentence, the right of such Guarantor to
contribution from other Guarantors and any other rights such Guarantor may have,
contractual or otherwise, shall be taken into account.
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 11.05, no Guarantor shall
consolidate or merge with or into (whether or not such Guarantor is the
surviving person), another corporation, Person or entity whether or not
affiliated with such Guarantor unless:
(1) the person formed by or surviving any such consolidation
or merger (if other than such Guarantor) assumes all the Obligations of
such Guarantor pursuant to a supplemental indenture in the form of
Exhibit E hereto and under the Notes and this Indenture;
(2) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(3) after such Guarantor or any Person formed by or surviving
any such consolidation or merger would be permitted by virtue of the
Company's Fixed Charge Coverage Ratio set forth in the first paragraph
of Section 4.09 hereof to incur, immediately after giving effect to
such transaction, at least $1.00 of additional Indebtedness.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person will succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued will in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes will prevent any consolidation or merger of a
74
Guarantor with or into the Company or another Guarantor, or will prevent any
sale or conveyance of the property of a Guarantor as an entirety or
substantially as an entirety to the Company or another Guarantor.
Section 11.05 Releases of Guarantor.
Concurrently with the payment in full of all of the Company's
Obligations under the Notes and this Indenture (other than with respect to any
indemnification obligations), each Guarantor shall be released from and relieved
of its Obligations under this Article 11. In the event of a sale or other
disposition of all of the assets of any Guarantor, which sale or other
disposition is otherwise in compliance with the terms of this Indenture, by way
of merger, consolidation or otherwise, or a sale or other disposition of all of
the capital stock of any Guarantor, then such Guarantor (in the event of a sale
or other disposition, by way of such a merger, consolidation or otherwise, of
all of the capital stock of such Guarantor) or the corporation acquiring the
property (in the event of a sale or other disposition of all of the assets of
such Guarantor) will be automatically and unconditionally released and relieved
of any obligations under its Subsidiary Guarantee. The Trustee shall deliver an
appropriate instrument evidencing any such release under this Section 11.05 upon
receipt of a request by the Company accompanied by an Officers' Certificate and
an Opinion of Counsel certifying as to the compliance with this Section 11.05.
The provisions of Section 11.04 shall not apply to any merger or consolidation
pursuant to which a Guarantor is released from its Obligations under this 11.05.
In the event of any sale or other disposition of all or substantially
all of the assets of any Guarantor, by way of merger, consolidation or
otherwise, or a sale or other disposition of all to the Capital Stock of any
Guarantor, in each case to a Person that is not (either before or after giving
effect to such transactions) a Restricted Subsidiary of the Company, then such
Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the capital stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) will be
released and relieved of any obligations under its Note Guarantee; provided that
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Indenture, including without limitation
Section 4.10 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 provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee will
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Note Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee will remain liable for the full amount of principal of and interest on
the Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article 11.
ARTICLE 12.
satisfaction and discharge
Section 12.01 Satisfaction and Discharge.
The Company may terminate its obligations (and the obligations of any
Guarantor in respect of Subsidiary Guarantees) under the Notes and this
Indenture if:
(1) all such Notes thereto authenticated and delivered (except
lost, stolen or destroyed Notes that have been replaced or paid and
Notes for whose payment cash in United States dollars has theretofore
been deposited in trust or segregated and held in trust by the Company
and thereafter repaid to the Company, as provided in Section 8.06, or
discharged from such trust)
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have been delivered to the Trustee for cancellation and the Company has
paid all sums payable by it hereunder, or
(2) if (i) either (x) pursuant to Article 3, the Company shall
have given notice to the Trustee and mailed a notice of redemption to
each Holder of the redemption of all of the Notes under arrangements
satisfactory to the Trustee for the giving of such notice or (y) all
Notes have otherwise become due and payable hereunder, (ii) the Company
shall have irrevocably deposited or caused to be deposited with the
Trustee or a trustee satisfactory to the Trustee, under the terms of an
irrevocable trust agreement in form and substance satisfactory to the
Trustee, as trust funds in trust solely for the benefit of the Holders
for that purpose, cash in United States dollars in such amount as is
sufficient without consideration of reinvestment of such interest, to
pay principal of, premium, if any, interest and Liquidated Damages, if
any, on the outstanding Notes to maturity or redemption; provided that
the Trustee shall have been irrevocably instructed to apply such
deposit to the payment of said principal, premium, if any, interest and
Liquidated Damages, if any, with respect to the Notes; and, provided,
further, that from and after the time of deposit, the money deposited
shall not be subject to the rights of holders of Senior Debt pursuant
to the provisions of Article 10; (iii) no Default or Event of Default
with respect to this Indenture or the Notes shall have occurred and be
continuing on the date of such deposit or shall occur as a result of
such deposit and such deposit will not result in a breach or violation
of, or constitute a default under, any other instrument to which the
Company or any Guarantor is a party or by which it is bound; (iv) the
Company shall have paid all other sums payable by it hereunder; and (v)
the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent relating to the satisfaction and discharge of this Indenture
have been complied with. Such Opinion of Counsel shall also state that
such satisfaction and discharge does not result in a default under any
Credit Facility (if then in effect) or any other agreement or
instrument then known to such counsel that binds or affects the Company
or any Guarantor.
Notwithstanding the satisfaction and discharge of this Indenture, if
money has been deposited with the Trustee pursuant to clause (1) of this
Section, the provisions of Section 12.02 and Section 8.06 will survive. In
addition, nothing in this Section 12.01 will be deemed to discharge those
provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.
Section 12.02 Application of Trust Money.
Subject to the provisions of Section 8.06, all money deposited with the
Trustee pursuant to Section 12.01 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as its
own Paying Agent) as the Trustee may determine, to the Persons entitled thereto,
of the principal (and premium, if any) and interest for whose payment such money
has been deposited with the Trustee; but such money need not be segregated from
other funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 12.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and any Guarantor's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 12.01; provided that if the Company has made any payment of principal
of, premium, if any, or interest on any Notes because of the reinstatement
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of its obligations, the Company shall be subrogated to the rights of the Holders
of such Notes to receive such payment from the money or Government Securities
held by the Trustee or Paying Agent.
ARTICLE 13.
MISCELLANEOUS
Section 13.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss.318(c), the imposed duties will control.
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:
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
P.O. Box 2700
Fairfield, New Jersey 07004
Telecopier No.: (000) 000-0000
Attention: Xxxxxx Xxxxxxxxx
With a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxx
If to the Trustee (for registered and certified mail only):
Xxxxx Fargo Bank Minnesota, NA
MAC# N9303-121
Corporate Trust Operations
P.O. Box 1517
Minneapolis, MN 55480-1517
Attention: Xxxxxxx Xxxxx
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) will
be deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
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Any notice or communication to a Holder will 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 will 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 will 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 will 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:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which must 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
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set
forth in Section 13.05 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)) must comply with the provisions of TIA ss. 314(e)
and must include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
him or her to express an informed opinion as to whether or not such
covenant or condition has been satisfied; and
(4) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied ; provided,
however, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificate of public officials.
78
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 director, officer, employee, incorporator or stockholder, past,
present or future of the Company, any successor Person or any Guarantor, as
such, shall have any liability for any obligations of the Company under the
Notes, any Guarantee thereof 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. Such waiver and
release may not be effective to waive or release liabilities under the federal
securities laws.
Section 13.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, 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 will bind
its successors. All agreements of the Trustee in this Indenture will bind its
successors.
Section 13.11 Severability.
In case any provision in this Indenture or in the Notes is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby.
Section 13.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy will 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 will in no
way modify or restrict any of the terms or provisions hereof.
79
[Signatures on following page]
80
SIGNATURES
Dated as of April 29, 2002
PRIME HOSPITALITY CORP.
By:
----------------------------------
Name:
Title:
XXXXX FARGO BANK MINNESOTA, NA
By:
----------------------------------
Name:
Title:
81
[Face of Note]
--------------------------------------------------------------------------------
CUSIP/CINS ____________
8 3/8% Senior Subordinated Notes due 2012
No. ___ $____________
PRIME HOSPITALITY CORP.
promises to pay to CEDE & CO.
or registered assigns,
the principal sum of
-----------------------------------------------------------
Dollars on May 1, 2012.
Interest Payment Dates: May 1 and November 1
Record Dates: April 15 and October 15
Dated: April 29, 2002
PRIME HOSPITALITY CORP.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
This is one of the Notes referred to
in the within-mentioned Indenture:
XXXXX FARGO BANK MINNESOTA, NA,
as Trustee
By:
--------------------------------------------
Authorized Signatory
--------------------------------------------------------------------------------
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[Back of Note]
8 3/8% Senior Subordinated Notes due 2012
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Prime Hospitality Corp., a Delaware corporation
(the "Company"), promises to pay interest on the principal amount of
this Note at 8 3/8% per annum from April 29, 2002 until maturity and
shall pay the Liquidated Damages, if any, payable pursuant to the
Registration Rights Agreement referred to below. The Company will pay
interest and Liquidated Damages, if any, semi-annually in arrears on
May 1 and November 1 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; provided, further, that the first Interest Payment Date
shall be November 1, 2002. The Company will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium, if any, from time to time on demand at a
rate that is 1% per annum in excess of the rate then in effect; it will
pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest and Liquidated
Damages, if any, (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest
will be computed on the basis of a 360-day year of twelve 30-day
months.
(2) METHOD OF PAYMENT. The Company will pay interest on the
Notes (except defaulted interest) and Liquidated Damages, if any, to
the Persons who are registered Holders of Notes at the close of
business on the April 15 or October 15 next preceding the Interest
Payment Date, even if such Notes are canceled after such record date
and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture with respect to defaulted interest.
Principal of and premium, interest and Liquidated Damages, if any, on
the notes will be payable at the office or agency of Prime maintained
for such purpose or, at the option of Prime, payment of interest and
Liquidated Damages may be made by check mailed to the holders of the
notes at their respective addresses set forth in the register of
holders of notes; provided that all payments with respect to notes the
holders of which have given wire transfer instructions to Prime will be
required to be made by wire transfer of immediately available funds to
the accounts specified by the holders thereof.
(3) PAYING AGENT AND REGISTRAR. Initially, Xxxxx Fargo Bank
Minnesota, NA, 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.
(4) INDENTURE. The Company issued the Notes under an Indenture
dated as of April 29, 2002 (the "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
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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 unsecured obligations of the Company.
(5) Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Company will not have the option to redeem the Notes prior to May 1, 2007.
Thereafter, the Company will have the option to redeem the Notes, in whole or in
part, upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period beginning
on May 1 of the years indicated below:
Year Percentage
---- ----------
2007............................................................................. 104.1%
2008............................................................................. 102.7%
2009............................................................................. 101.3%
2010 and thereafter.............................................................. 100.0%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to May 1, 2005, the Company may redeem up to 35%
of the aggregate principal amount of the Notes with the net proceeds of a Public
Equity Offering at a redemption price equal to 108.375% of the aggregate
principal amount thereof; provided that at least 65% in aggregate principal
amount of the Notes issued under the Indenture remains outstanding immediately
after the occurrence of such redemption and that such redemption occurs within
90 days of the date of the closing of such Public Equity Offering.
(6) Mandatory Redemption.
The Company will not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
(7) Repurchase at Option of Holder.
(a) If there is a Change of Control, the Company will be
required to make an offer (a "Change of Control Offer") to repurchase
all or any part (equal to $1,000 or an integral multiple thereof) of
each Holder's Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest and
Liquidated Damages thereon, if any, to the date of purchase (the
"Change of Control Payment"). Within 30 days following any Change of
Control, the Company will mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales
and the aggregate amount of Excess Proceeds exceeds $25 million, the
Company will commence an offer to all Holders of Notes and all holders
of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth in the Indenture with respect to
offers to purchase or redeem with the proceeds of sales of assets (an
"Asset Sale Offer") pursuant to Section 3.09 of the Indenture to
purchase the maximum principal amount of Notes (including any
Additional Notes) and other pari passu Indebtedness that may be
purchased out of the Excess Proceeds at an
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offer price in cash in an amount equal to 100% of the principal amount
thereof plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the date fixed for the closing of such offer, in
accordance with the procedures set forth in the Indenture. To the
extent that the aggregate amount of Notes (including any Additional
Notes) and other pari passu Indebtedness tendered pursuant to an Asset
Sale Offer is less than the Excess Proceeds, the Company (or such
Subsidiary) may use such deficiency for general corporate purposes. If
the aggregate principal amount of Notes and other pari passu
Indebtedness surrendered by holders thereof exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and other pari
passu Indebtedness to be purchased in accordance with Section 3.02 of
the Indenture. Holders of Notes that are the subject of an offer to
purchase will receive an Asset Sale Offer from the Company prior to any
related purchase date and may elect to have such Notes purchased by
completing the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Notes.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed
at least 30 days but not more than 60 days before the redemption date
to each Holder whose Notes are to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes
held by a Holder are to be redeemed. On and after the redemption date
interest ceases to accrue on Notes or portions thereof called for
redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes
may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company 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.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note
may be treated as its owner for all purposes.
(11) 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 Additional Notes, if any,
voting as a single class, 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 and Additional Notes, if any, voting as a single
class. 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, to provide for the assumption of the
Company's or obligations to Holders of the Notes 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 SEC in order to effect
or maintain the qualification of the Indenture under the Trust
Indenture Act, to provide for the Issuance of Additional Notes in
accordance with the limitations set forth in the Indenture, or to
release a Guarantor in accordance with the Indenture.
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(12) DEFAULTS AND REMEDIES. Each of the following is an "Event
of Default": (1) the Company defaults for 30 days in the payment when
due of interest on the Notes whether or not prohibited by the
subordination provisions of the Indenture; (2) default in payment when
due of principal of or premium, if any, on the Notes at maturity, upon
redemption or otherwise (including the failure to make a payment to
purchase Notes tendered pursuant to a Change of Control Offer or an
Assets Sale Offer) (whether or not such payment shall be prohibited by
the subordination provisions of the Indenture); (3) failure by the
Company or any Restricted Subsidiary to comply with the Indenture
Section 4.15 (other than a failure to make a payment to purchase Notes
pursuant thereto, which failure shall be an Event of Default pursuant
to clause (2) above), 4.10 (other than a failure to make a payment to
purchase Notes pursuant thereto, which failure shall be an Event of
Default pursuant to clause (2) above), 4.07, 4.09 and 5.01, which
failure continues for a period of 30 days after written notice shall
have been given to the Company by the Trustee or to the Company and the
Trustee from Holders of at least 25% in principal amount of the Notes
then outstanding; (4) failure by the Company or any Guarantor for 60
days in the performance of any other covenant, warranty or agreement in
the Indenture or the Notes after written notice shall have been given
to the Company by the Trustee or to the Company and the Trustee from
Holders of at least 25% in principal amount of the Notes then
outstanding; (5) the failure to pay at final stated maturity (giving
effect to any applicable grace periods and any extensions thereof) the
principal amount of Non-Recourse Indebtedness of the Company or any of
its Restricted Subsidiaries with an aggregate principal amount in
excess of the lesser of (A) 10% of the total assets of the Company and
its Restricted Subsidiaries measured as of the end of the Company's
most recent fiscal quarter for which internal financial statements are
available immediately preceding the date on which such default
occurred, determined on a pro forma basis and (B) $100 million, and
such failure continues for a period of 10 days or more, or the
acceleration of the final stated maturity of any such Non-Recourse
Indebtedness (which acceleration is not rescinded, annulled or
otherwise cured within 10 days of receipt by the Company or such
Restricted Subsidiary of notice of any such acceleration); (6) the
failure to pay at final stated maturity (giving effect to any
applicable grace periods and any extensions thereof) the principal
amount of any Indebtedness (other than Non-Recourse Indebtedness) of
the Company or any Restricted Subsidiary of the Company and such
failure continues for a period of 10 days or more, or the acceleration
of the final stated maturity of any such Indebtedness (which
acceleration is not rescinded, annulled or otherwise cured within 10
days of receipt by the Company or such Restricted Subsidiary of notice
of any such acceleration) if the aggregate principal amount of such
Indebtedness, together with the principal amount of any other such
Indebtedness in default for failure to pay principal at final maturity
or which has been accelerated, in each case with respect to which the
10-day period described above has passed, aggregates $20.0 million or
more at any time; (7) failure by the Company or any of its Restricted
Subsidiaries to pay final judgments rendered against them (other than
judgment liens without recourse to any assets or property of the
Company or any of its Restricted Subsidiaries other than assets or
property securing Non-Recourse Indebtedness) aggregating in excess of
$20.0 million, which judgments are not paid, discharged or stayed for a
period of 90 days (other than any judgments as to which a reputable
insurance company has accepted full liability); (8) except as permitted
by the Indenture, any Subsidiary Guarantee shall be held in a judicial
proceeding to be unenforceable or invalid or shall cease for any reason
to be in full force and effect or any Guarantor (or its successors or
assigns), or any Person acting on behalf of such Guarantor (or its
successors or assigns), shall deny or disaffirm its obligations or
shall fail to comply with any obligations under its Subsidiary
Guarantee; (9) the Company, any Guarantor or any of the Company's
Subsidiaries that would constitute a Significant Subsidiary or any
group of the Company's Subsidiaries that, taken together, would
constitute a Significant Subsidiary pursuant to or within the meaning
of the Bankruptcy Law: (A) commences a voluntary case, (B) consents to
the entry of an order for relief against it in an involuntary case; (C)
consents to the appointment
A-5
of a Custodian of it or for all or substantially all of its property;
(D) makes a general assignment for the benefit of its creditors; or (E)
admits in writing its inability to pay its debts as they become due;
and (10) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (A) is for relief in an involuntary case
against the Company, any Guarantor or any Subsidiary that is a
Significant Subsidiary of the Company or any group of Subsidiaries
that, taken together, would constitute a Significant Subsidiary of the
Company; (B) appoints a Custodian of the Company, any Guarantor or any
Subsidiary that is a Significant Subsidiary of the Company or any group
of Subsidiaries that, taken together, would constitute a Significant
Subsidiary of the Company, or for all or substantially all of the
property of the Company, any Guarantor or any Subsidiary that is a
Significant Subsidiary of the Company, or any group of Subsidiaries
that, taken together, would constitute a Significant Subsidiary of the
Company; or (C) orders the liquidation of the Company, any Guarantor or
any Subsidiary that is a Significant Subsidiary of the Company or any
group of Subsidiaries that, taken together, would constitute a
Significant Subsidiary of the Company, and the order or decree remains
unstayed and in effect for 60 consecutive days.
(13) SUBORDINATION. Payment of principal, interest and premium
and Liquidated Damages, if any, on the Notes is subordinated to the
prior payment of Senior Debt on the terms provided in the Indenture.
(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. A director, officer,
employee, incorporator or stockholder, of the Company, as such, will
not 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 will 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) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
Holders of Notes under the Indenture, Holders of Restricted Global
Notes and Restricted Definitive Notes will have all the rights set
forth in the Registration Rights Agreement dated as of April 29, 2002,
between the Company and the other parties named on the signature pages
thereof or, in the case of Additional Notes, Holders of Restricted
Global Notes and Restricted Definitive Notes will have the rights set
forth in one or more registration rights agreements, if any, between
the Company and the other parties thereto, relating to rights given by
the Company to the purchasers of any Additional Notes (collectively,
the "Registration Rights Agreement").
(19) CUSIP NUMBERS. Pursuant to a recommendation promulgated
by the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers
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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.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement.
Requests may be made to:
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:
---------------------------------
(Insert assignee's legal name)
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
--------------------------------------------------------
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature:
---------------------------------
(Sign exactly as your name
appears on the face of this Note)
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
Section 4.10 Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$____________________
Date: _______________
Your Signature:
--------------------------------
(Sign exactly as your name
appears on the face of this Note)
Tax Identification No.:
-------------------------
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note, have
been made:
Principal Amount
of this Global Note Signature of
Amount of decrease Amount of increase in following such authorized officer
in Principal Amount Principal Amount decrease of Trustee or
Date of Exchange of this Global Note of this Global Note (or increase) Custodian
---------------- ------------------- ------------------- ------------- ---------
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EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Xxxxx Fargo Bank Minnesota, NA
MAC# N9303-121
Corporate Trust Operations
P.O. Box 1517
Minneapolis, MN 55480-1517
Re: 8 3/8% Senior Subordinated Notes due 2012
Reference is hereby made to the Indenture, dated as of April 29, 2002
(the "Indenture"), between Prime Hospitality Corp., as issuer (the "Company"),
and Xxxxx Fargo Bank Minnesota, NA as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the Securities
Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor
hereby further certifies that the beneficial interest or Definitive Note is
being transferred to a Person that the Transferor reasonably believed and
believes is purchasing the beneficial interest or Definitive Note for its own
account, or for one or more accounts with respect to which such Person exercises
sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note and/or the Definitive Note and in the
Indenture and the Securities Act.
2. CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO REGULATION S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby further
certifies that (i) the Transfer is not being made to a Person in the United
States and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act and, (iii) the transaction is not part of a plan or
scheme to evade the registration
B-1
requirements of the Securities Act. Upon consummation of the proposed transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on Transfer
enumerated in the Private Placement Legend printed on the Regulation S Global
Note and/or the Definitive Note and in the Indenture and the Securities Act.
3. CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY PROVISION
OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or
Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation D
under the Securities Act and the Transfer complies with the transfer
restrictions applicable to beneficial interests in a Restricted Global
Note or Restricted Definitive Notes and the requirements of the
exemption claimed, which certification is supported by (1) a
certificate executed by the Transferee in the form of Exhibit D to the
Indenture and (2) if such Transfer is in respect of a principal amount
of Notes at the time of transfer of less than $250,000, an Opinion of
Counsel provided by the Transferor or the Transferee (a copy of which
the Transferor has attached to this certification), to the effect that
such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of
the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the IAI Global Note and/or the
Definitive Notes and in the Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of
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the proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will no longer be subject to
the restrictions on transfer enumerated in the Private Placement Legend printed
on the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904 under
the Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
--------------------------------------
[Insert Name of Transferor]
By:
-----------------------------------
Name:
Title:
Dated: _______________________
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ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii)[ ] Regulation S Global Note (CUSIP _________),
or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________),
or
(iii) [ ] IAI Global Note (CUSIP _________); or
(iv) [ ] Unrestricted Global Note (CUSIP _________);
or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Xxxxx Fargo Bank Minnesota, NA
MAC# N9303-121
Corporate Trust Operations
P.O. Box 1517
Minneapolis, MN 55480-1517
Re: 8 3/8% Senior Subordinated Notes due 2012
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of April 29, 2002
(the "Indenture"), between Prime Hospitality Corp., as issuer (the "Company"),
and Xxxxx Fargo Bank Minnesota, NA as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to exchange
the Note[s] or interest in such Note[s] specified herein, in the principal
amount of $____________ in such Note[s] or interests (the "Exchange"). In
connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN A
RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the Securities Act of 1933, as
amended (the "Securities Act"), (iii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is
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being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN
RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CHECK ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
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This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
----------------------------------------
[Insert Name of Transferor]
By:
-------------------------------------
Name:
Title:
Dated: ______________________
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EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Xxxxx Fargo Bank Minnesota, NA
MAC# N9303-121
Corporate Trust Operations
P.O. Box 1517
Minneapolis, MN 55480-1517
Re: 8 3/8% Senior Subordinated due 2012
Reference is hereby made to the Indenture, dated as of April 29, 2002
(the "Indenture"), between Prime Hospitality Corp., as issuer (the "Company"),
and Xxxxx Fargo Bank Minnesota, NA, as trustee. Capitalized terms used but not
defined herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and, if such transfer is in respect of
a principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
D-1
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased
by us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
--------------------------------------------
[Insert Name of Accredited Investor]
By:
-----------------------------------------
Name:
Title:
Dated: _______________________
D-2
EXHIBIT E
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, 200__, among __________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Prime Hospitality Corp. (or its permitted
successor), a [Delaware] corporation (the "Company"), the Company, the other
Guarantors (as defined in the Indenture referred to herein) and Xxxxx Fargo Bank
Minnesota, NA, as trustee under the indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of April 29, 2002 providing for
the issuance of an unlimited amount of up 8 3/8% Senior Subordinated Notes due
2012 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Note Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees as
follows:
(a) Along with all Guarantors named in the Indenture, to
jointly and severally Guarantee to each Holder of a Note authenticated
and delivered by the Trustee and to the Trustee and its successors and
assigns, the Notes or the obligations of the Company hereunder or
thereunder, that:
(i) the principal of, and premium and Liquidated Damages, if
any, and interest on the Notes will be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on the Notes, if any,
if lawful, and all other obligations of the Company to the Holders or
the Trustee hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so
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guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same
immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes
or the Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of
a Guarantor.
(c) The following is hereby waived: diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands
whatsoever.
(d) This Note Guarantee shall not be discharged except by
complete performance of the obligations contained in the Notes and the
Indenture, and the Guaranteeing Subsidiary accepts all obligations of a
Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any custodian,
trustee, liquidator or other similar official acting in relation to
either the Company or the Guarantors, any amount paid by either to the
Trustee or such Holder, this Note Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the
Holders and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article
6 of the Indenture for the purposes of this Note Guarantee,
notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and
(y) in the event of any declaration of acceleration of such obligations
as provided in Article 6 of the Indenture, such obligations (whether or
not due and payable) shall forthwith become due and payable by the
Guarantors for the purpose of this Note Guarantee.
(h) The Guarantors shall have the right to seek contribution
from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Note Guarantee.
(i) Pursuant to Section 11.02 of the Indenture, after giving
effect to any maximum amount and all other contingent and fixed
liabilities that are relevant under any applicable Bankruptcy or
fraudulent conveyance laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such
other Guarantor under Article 10 of the Indenture, this new Note
Guarantee shall be limited to the maximum amount permissible such that
the obligations of such Guarantor under this Note Guarantee will not
constitute a fraudulent transfer or conveyance.
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3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
4. GUARANTEEING SUBSIDIARY mAY CONSOLIDATE, eTC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not sell or otherwise
dispose of all substantially all of its assets to, or consolidate with
or merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than the Company or another Guarantor
unless:
(i) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(ii) either (A) subject to Sections 11.04 and 11.05 of the
Indenture, the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such consolidation
or merger unconditionally assumes all the obligations of that
Guarantor, pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, under the Notes, the Indenture
and the Note Guarantee on the terms set forth herein or therein; or (B)
the Net Proceeds of such sale or other disposition are applied in
accordance with the applicable provisions of the Indenture, including
without limitation, Section 4.10 thereof.
(b) In case of any such consolidation, merger, sale or
conveyance and upon the assumption by the successor Person, by
supplemental indenture, executed and delivered to the Trustee and
satisfactory in form to the Trustee, of the Note Guarantee endorsed
upon the Notes and the due and punctual performance of all of the
covenants and conditions of the Indenture to be performed by the
Guarantor, such successor Person shall succeed to and be substituted
for the Guarantor with the same effect as if it had been named herein
as a Guarantor. Such successor Person thereupon may cause to be signed
any or all of the Note Guarantees to be endorsed upon all of the Notes
issuable under the Indenture which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued shall in all respects have the same legal rank and
benefit under the Indenture as the Note Guarantees theretofore and
thereafter issued in accordance with the terms of the Indenture as
though all of such Note Guarantees had been issued at the date of the
execution hereof.
(c) Except as set forth in Articles 4 and 5 and Section 11.04
of Article 11 of the Indenture, and notwithstanding clauses (a) and (b)
above, nothing contained in the Indenture or in any of the Notes shall
prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or shall prevent any sale or conveyance
of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
5. RELEASES.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of
the capital stock of any Guarantor, in each case to a Person that is
not (either before or after giving effect to such transaction) a
Restricted Subsidiary of the Company, then such Guarantor (in the event
of a sale or other disposition, by way of
E-3
merger, consolidation or otherwise, of all of the capital stock of such
Guarantor) or the corporation acquiring the property (in the event of a
sale or other disposition of all or substantially all of the assets of
such Guarantor) will be released and relieved of any obligations under
its Note Guarantee; provided that the Net Proceeds of such sale or
other disposition are applied in accordance with the applicable
provisions of the Indenture, including without limitation Section 4.10
of the Indenture. Upon delivery by the Company to the Trustee of an
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 provisions of the Indenture, including without limitation Section
4.10 of the Indenture, the Trustee shall execute any documents
reasonably required in order to evidence the release of any Guarantor
from its obligations under its Note Guarantee.
(b) Any Guarantor not released from its obligations under its
Note Guarantee shall remain liable for the full amount of principal of
and interest on the Notes and for the other obligations of any
Guarantor under the Indenture as provided in Article 11 of the
Indenture.
6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the Company
or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the
Indenture or this Supplemental Indenture or for any claim based on, in respect
of, or by reason of, such obligations or their creation. Each Holder of the
Notes by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. Such waiver may
not be effective to waive liabilities under the federal securities laws and it
is the view of the SEC that such a waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, 20___
[GUARANTEEING SUBSIDIARY]
By: _______________________________
Name:
Title:
[COMPANY]
By: _______________________________
Name:
Title:
[EXISTING GUARANTORS]
By: _______________________________
Name:
Title:
[TRUSTEE],
as Trustee
By: _______________________________
Authorized Signatory
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