1
Exhibit 4.4
INDENTURE
DATED AS OF AUGUST 19, 1997
AMONG
HERMES EUROPE RAILTEL B.V., AS ISSUER,
GLOBAL TELESYSTEMS GROUP, INC.
AND
THE BANK OF NEW YORK, AS TRUSTEE
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$265,000,000
11-1/2% SENIOR NOTES DUE 2007
11-1/2% SENIOR NOTES DUE 2007, SERIES B
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CROSS-REFERENCE TABLE
TRUST INDENTURE INDENTURE
ACT Section Section
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Section 310(a)(1)................................................................... 7.10
(a)(2)......................................................................... 7.10
(a)(3)......................................................................... N.A.
(a)(4)......................................................................... N.A.
(a)(5)......................................................................... 7.08, 7.10.
(b)............................................................................ 7.08; 7.10; 10.02
(c)............................................................................ N.A.
Section 311(a)...................................................................... 7.11
(b)............................................................................ 7.11
(c)............................................................................ N.A.
Section 312(a)....................................................................... 2.05
(b)............................................................................ 10.03
(c)............................................................................ 10.03
Section 313(a)....................................................................... 7.06
(b)(1)......................................................................... 7.06
(b)(2)......................................................................... 7.06
(c)............................................................................ 7.06; 10.02
(d)............................................................................ 7.06
Section 314(a)....................................................................... 4.07; 4.09; 10.02
(b)............................................................................ 11.02
(c)(1)......................................................................... 10.04
(c)(2)......................................................................... 10.04
(c)(3)......................................................................... N.A.
(d)............................................................................ 11.03
(e)............................................................................ 10.05
(f)............................................................................ N.A.
Section 315(a)....................................................................... 7.01(b)
(b)............................................................................ 7.05; 10.02
(c)............................................................................ 7.01(a)
(d)............................................................................ 7.01(c)
(e)............................................................................ 6.11
Section 316(a)(last sentence)........................................................ 2.09
(a)(1)(A)...................................................................... 6.05
(a)(1)(B)...................................................................... 6.04
(a)(2)......................................................................... N.A.
(b)............................................................................ 6.07
(c)............................................................................ 9.04
Section 317(a)(1).................................................................... 6.08
(a)(2)......................................................................... 6.09
(b)............................................................................ 2.04
Section 318(a)....................................................................... 10.01
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
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TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions...............................................................................1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.........................................18
SECTION 1.03. Rules of Construction.....................................................................19
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating...........................................................................19
SECTION 2.02. Execution and Authentication..............................................................20
SECTION 2.03. Registrar and Paying Agent................................................................21
SECTION 2.04. Paying Agent To Hold Assets in Trust......................................................21
SECTION 2.05. Securityholder Lists......................................................................22
SECTION 2.06. Transfer and Exchange.....................................................................22
SECTION 2.07. Replacement Securities....................................................................22
SECTION 2.08. Outstanding Securities....................................................................23
SECTION 2.09. Treasury Securities.......................................................................23
SECTION 2.10. Temporary Securities......................................................................23
SECTION 2.11. Cancellation..............................................................................23
SECTION 2.12. Defaulted Interest........................................................................24
SECTION 2.13. CUSIP Number..............................................................................24
SECTION 2.14. Deposit of Moneys.........................................................................24
SECTION 2.15. Book-Entry Provisions for Global Securities...............................................24
SECTION 2.16. Registration of Transfers and Exchanges...................................................25
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee........................................................................29
SECTION 3.02. Selection of Securities To Be Redeemed....................................................29
SECTION 3.03. Notice of Redemption......................................................................29
SECTION 3.04. Effect of Notice of Redemption............................................................30
SECTION 3.05. Deposit of Redemption Price...............................................................30
SECTION 3.06. Securities Redeemed in Part...............................................................31
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.....................................................................31
SECTION 4.02. Maintenance of Office or Agency...........................................................31
SECTION 4.03. Corporate Existence.......................................................................31
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SECTION 4.04. Payment of Taxes and Other Claims.........................................................32
SECTION 4.05. Notice of Defaults........................................................................32
SECTION 4.06. Maintenance of Properties and Insurance...................................................32
SECTION 4.07. Compliance Certificate....................................................................33
SECTION 4.08. Waiver of Stay, Extension or Usury Laws...................................................33
SECTION 4.09. Provision of Financial Information........................................................33
SECTION 4.10. Change of Control.........................................................................34
SECTION 4.11. Limitation on Restricted Payments.........................................................34
SECTION 4.12. Limitation on Incurrence of Indebtedness..................................................36
SECTION 4.13. Limitations on Restrictions Affecting Restricted Subsidiaries.............................38
SECTION 4.14. Designation of Unrestricted Subsidiaries..................................................39
SECTION 4.15. Limitation on Liens.......................................................................40
SECTION 4.16. Limitation on Asset Sales.................................................................40
SECTION 4.17. Limitation on Transactions with Affiliates................................................41
SECTION 4.18. Limitation on Issuances of Guarantees by Restricted Subsidiaries..........................42
SECTION 4.19. Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries............................................................................43
SECTION 4.20. Additional Amounts........................................................................43
SECTION 4.21. Deposit of Funds with Escrow Agent........................................................43
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Sale of Assets, etc..............................................................44
SECTION 5.02. Successor Corporation Substituted.........................................................44
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.........................................................................45
SECTION 6.02. Acceleration..............................................................................46
SECTION 6.03. Other Remedies............................................................................47
SECTION 6.04. Waiver of Past Default....................................................................47
SECTION 6.05. Control by Majority.......................................................................48
SECTION 6.06. Limitation on Suits.......................................................................48
SECTION 6.07. Rights of Holders To Receive Payment......................................................48
SECTION 6.08. Collection Suit by Trustee................................................................48
SECTION 6.09. Trustee May File Proofs of Claim..........................................................49
SECTION 6.10. Priorities................................................................................49
SECTION 6.11. Undertaking for Costs.....................................................................49
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.........................................................................50
SECTION 7.02. Rights of Trustee.........................................................................51
SECTION 7.03. Individual Rights of Trustee..............................................................52
SECTION 7.04. Trustee's Disclaimer......................................................................52
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SECTION 7.05. Notice of Defaults........................................................................52
SECTION 7.06. Reports by Trustee to Holders.............................................................52
SECTION 7.07. Compensation and Indemnity................................................................52
SECTION 7.08. Replacement of Trustee....................................................................53
SECTION 7.09. Successor Trustee by Merger, etc..........................................................54
SECTION 7.10. Eligibility; Disqualification.............................................................54
SECTION 7.11. Preferential Collection of Claims Against Company.........................................54
ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations......................................................55
SECTION 8.02. Application of Trust Money................................................................56
SECTION 8.03. Repayment to Company......................................................................56
SECTION 8.04. Reinstatement.............................................................................56
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders................................................................57
SECTION 9.02. With Consent of Holders...................................................................57
SECTION 9.03. Compliance with Trust Indenture Act.......................................................58
SECTION 9.04. Revocation and Effect of Consents.........................................................59
SECTION 9.05. Notation on or Exchange of Securities.....................................................59
SECTION 9.06. Trustee To Sign Amendments, etc...........................................................59
ARTICLE TEN MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls..............................................................60
SECTION 10.02. Notices...................................................................................60
SECTION 10.03. Communications by Holders with Other Holders..............................................62
SECTION 10.04. Certificate and Opinion as to Conditions Precedent........................................62
SECTION 10.05. Statements Required in Certificate or Opinion.............................................62
SECTION 10.06. Rules by Trustee, Paying Agent, Registrar.................................................63
SECTION 10.07. Governing Law.............................................................................63
SECTION 10.08. No Recourse Against Others................................................................63
SECTION 10.09. Successors................................................................................63
SECTION 10.10. Counterpart Originals.....................................................................63
SECTION 10.11. Severability..............................................................................63
SECTION 10.12. No Adverse Interpretation of Other Agreements.............................................64
SECTION 10.13. Legal Holidays............................................................................64
SECTION 10.14. Agent for Service; Submission to Jurisdiction; Waiver of Immunities.......................64
SECTION 10.15. Judgment Currency.........................................................................64
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ARTICLE ELEVEN
COLLATERAL AND SECURITY
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SECTION 11.01. Escrow Agreement..........................................................................65
SECTION 11.02. Recording and Opinions....................................................................65
SECTION 11.03. Release of Collateral.....................................................................66
SECTION 11.04. Authorization of Actions to Be Taken by the Trustee Under the
Escrow Agreement........................................................................66
SECTION 11.05. Authorization of Receipt of Funds by the Trustee Under the Escrow
Agreement...............................................................................67
SECTION 11.06. Termination of Security Interest..........................................................67
ARTICLE TWELVE
COVENANT OF GLOBAL TELESYSTEMS GROUP, INC.
SECTION 12.01. GTS Contribution..........................................................................67
SIGNATURES..................................................................................................S-1
EXHIBIT A Form of Series A Security.................................................................A-1
EXHIBIT B Form of Series B Security.................................................................B-1
EXHIBIT C Form of Legend for Global Securities......................................................C-1
EXHIBIT D Form of Transfer Certificate..............................................................D-1
EXHIBIT E Form of Transfer Certificate for Institutional Accredited Investors.......................E-1
EXHIBIT F Form of Transfer Certificate for Regulation S Transfers...................................F-1
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INDENTURE dated as of August 19, 1997, among HERMES EUROPE
RAILTEL B.V., a Netherlands limited company (the "Company"), GLOBAL TELESYSTEMS
GROUP, INC., (with respect only to Article Twelve) and THE BANK OF NEW YORK, a
New York banking corporation, as Trustee.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Securities:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person (a)
assumed in connection with an Acquisition from such Person or (b) existing at
the time such Person becomes a Restricted Subsidiary or is merged or
consolidated with or into the Company or any Restricted Subsidiary; provided,
however, that such Indebtedness was not Incurred in connection with, or in
contemplation of, such Acquisition, such Person becoming a Restricted Subsidiary
or such merger or consolidation.
"Acquired Person" means, with respect to any specified Person,
any other Person which merges with or into or becomes a Subsidiary of such
specified Person.
"Acquisition" means (i) any capital contribution (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise) by the Company or any
Restricted Subsidiary to any other Person, or any acquisition or purchase of
Equity Interests of any other Person by the Company or any Restricted
Subsidiary, in either case pursuant to which such Person shall become a
Restricted Subsidiary or shall be consolidated, merged with or into the Company
or any Restricted Subsidiary or (ii) any acquisition by the Company or any
Restricted Subsidiary of the assets of any Person which constitute substantially
all of an operating unit or line of business of such Person or which is
otherwise outside of the ordinary course of business.
"Additional Interest" has the meaning provided in Section 4(a)
of the Registration Rights Agreement.
"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.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Sale" means any direct or indirect sale, conveyance,
transfer, lease (that has the effect of a disposition) or other disposition
(including, without limitation, any merger, consolidation or sale-leaseback
transaction) to any Person other than the Company or a Restricted Subsidiary, in
one transaction or a series of
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related transactions, of (i) any Equity Interest of any Restricted Subsidiary;
(ii) any material license, franchise or other authorization of the Company or
any Restricted Subsidiary; (iii) any assets of the Company or any Restricted
Subsidiary which constitute substantially all of an operating unit or line of
business of the Company or any Restricted Subsidiary; or (iv) any other property
or asset of the Company or any Restricted Subsidiary outside of the ordinary
course of business (including the receipt of proceeds paid on account of the
loss of or damage to any property or asset and awards of compensation for any
asset taken by condemnation, eminent domain or similar proceedings). For the
purposes of this definition, the term "Asset Sale" shall not include (a) any
transaction consummated in compliance with Section 5.01 and the creation of any
Lien not prohibited by Section 4.15; provided, however, that any transaction
consummated in compliance with Section 5.01 involving a sale, conveyance,
assignment, transfer, lease or other disposal of less than all of the properties
or assets of the Company and the Restricted Subsidiaries shall be deemed to be
an Asset Sale with respect to the properties or assets of the Company and
Restricted Subsidiaries that are not so sold, conveyed, assigned, transferred,
leased or otherwise disposed of in such transaction; (b) sales of property or
equipment that has become worn out, obsolete or damaged or otherwise unsuitable
for use in connection with the business of the Company or any Restricted
Subsidiary, as the case may be; and (c) any transaction consummated in
compliance with Section 4.11. In addition, solely for purposes of Section 4.16,
any sale, conveyance, transfer, lease or other disposition of any property or
asset, whether in one transaction or a series of related transactions, involving
assets with a Fair Market Value not in excess of $1.0 million in any fiscal year
shall be deemed not to be an Asset Sale.
"Bankruptcy Law" see Section 6.01.
"Basket" see Section 4.11.
"Board of Directors" means, with respect to any Person, the
Board of Directors of such Person (or comparable governing body), or any
authorized committee of that Board (it being understood that the Board of
Directors of the Company shall be its Board of Supervisory Directors).
"Board Resolution" means, with respect to any Person, a duly
adopted resolution of the Board of Directors of such Person.
"Business Day" means a day (other than a Saturday or Sunday)
on which the Depository and banks in New York are open for business.
"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.
"Cash Equivalents" means: (a) U.S. dollars; (b) securities
issued or directly and fully guaranteed or insured by the U.S. government or any
agency or instrumentality thereof having maturities of not more than six months
from the date of acquisition; provided, however, that securities deposited in
the Escrow Account may have longer maturities; (c) certificates of deposit and
eurodollar time deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months and
overnight bank deposits, in each case with any commercial bank having capital
and surplus in excess of $500 million; provided, however, that securities
deposited in the Escrow Account may have longer maturities; (d) repurchase
obligations with a term of not more than seven days for underlying securities of
the types described in clauses (b) and (c) entered into with any financial
institution meeting the qualifications specified in clause (c) above; and (e)
commercial paper rated P-1, A-1 or the equivalent thereof by Xxxxx'x Investors
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Service, Inc. or Standard & Poor's Ratings Group, respectively, and in each case
maturing within six months after the date of acquisition.
"Change of Control" shall mean the occurrence of any of the
following events (whether or not approved by the Board of Directors of the
Company): (a) any Person or group, excluding Permitted Holders, is or becomes
the beneficial owner, directly or indirectly, of Voting Equity Interests
representing 35% or more of the total voting power of the Voting Equity
Interests of the Company at a time when the Permitted Holders together (x) own
Voting Equity Interests representing a lesser percentage of the total voting
power of the Voting Equity Interests of the Company, than such Person or group
(for purposes of determining the percentage of the Voting Equity Interests of
such Person or group, the holdings of the Permitted Holders who are part of such
Person or group shall not be counted in the Voting Equity Interests of such
Person or group) or (y) do not hold the power to elect a majority of the members
of the Board of Directors of the Company; (b) any Person or group is or becomes
the beneficial owner directly or indirectly, of Voting Equity Interests
representing 50% or more of the total voting power of the Voting Equity
Interests of GTS or has the power, directly or indirectly, to elect a majority
of the members of the Board of Directors of GTS; (c) the Company consolidates
with, or merges with or into, another Person or the Company or one or more
Restricted Subsidiaries sell, assign, convey, transfer, lease or otherwise
dispose of all or substantially all of the assets of the Company and the
Restricted Subsidiaries, taken as a whole, to any Person (other than a Wholly
Owned Restricted Subsidiary), or any Person consolidates with, or merges with or
into, the Company, in any such event other than pursuant to a transaction in
which the Person or Persons that "beneficially owned," directly or indirectly,
Voting Equity Interests representing a majority of the total voting power of the
Voting Equity Interests of the Company immediately prior to such transaction,
"beneficially own," directly or indirectly, Voting Equity Interests representing
a majority of the total voting power of the Voting Equity Interests of the
surviving or transferee Person; (d) GTS consolidates with, or merges with or
into, another Person or GTS or one or more of its Subsidiaries sell, assign,
convey, transfer, lease or otherwise dispose of all or substantially all of the
assets of GTS and its Subsidiaries, taken as a whole, to any Person (other than
a wholly owned Subsidiary of GTS), or any Person consolidates with, or merges
with or into, GTS, in any such event other than pursuant to a transaction in
which the Person or Persons that "beneficially owned," directly or indirectly,
Voting Equity Interests representing a majority of the total voting power of the
Voting Equity Interests of GTS immediately prior to such transaction,
"beneficially own," directly or indirectly Voting Equity Interests representing
a majority of the total voting power of the Voting Equity Interests of the
surviving or transferee Person; (e) during any consecutive two-year period,
individuals who at the beginning of such period constituted the Board of
Directors of the Company (together with any new directors whose election by the
Board of Directors of the Company or whose nomination for election by the
stockholders of the Company was approved by a vote of a majority of the
directors then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason (other than by action of the Permitted Holders)
to constitute a majority of the Board of Directors of the Company, then in
office; (f) during any consecutive two year period, individuals who at the
beginning of such period constituted the Board of Directors of GTS (together
with any new directors whose election by the Board of Directors of GTS or whose
nomination for election by the stockholders of GTS was approved by a vote of a
majority of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors of GTS then in office; or (g) there shall occur the
liquidation or dissolution of the Company or GTS. For purposes of this
definition, (I) "group" has the meaning under Section 13(d) and 14(d) of the
Exchange Act or any successor provision to either of the foregoing, including
any group acting for the purpose of acquiring, holding or disposing of
securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, and
(II) "beneficial ownership" has the meaning set forth in Rules 13d-3 and 13d-5
under the Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all securities that such Person has the
10
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right to acquire, whether such right is exercisable immediately or only after
the passage of time, upon the happening of an event or otherwise.
"Change of Control Date" see Section 4.10.
"Collateral" has the meaning set forth in Section 6 of the
Escrow Agreement.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by two Officers or by an Officer and
an Assistant Treasurer or an Assistant Secretary, and delivered to the Trustee.
"Consolidated Income Tax Expense" means, with respect to any
period, the provision for federal, state, local and foreign income taxes payable
by the Company and the Restricted Subsidiaries for such period as determined on
a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any
period, without duplication, the sum of (i) the interest expense of the Company
and the Restricted Subsidiaries for such period as determined on a consolidated
basis in accordance with GAAP, including, without limitation, (a) any
amortization of debt discount, (b) the net cost under Interest Rate Protection
Obligations (including any amortization of discounts), (c) the interest portion
of any deferred payment obligation, (d) all commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers' acceptance
financing and (e) all capitalized interest and all accrued interest, (ii) the
interest component of Capitalized Lease Obligations paid, accrued and/or
scheduled to be paid or accrued by the Company and the Restricted Subsidiaries
during such period as determined on a consolidated basis in accordance with GAAP
and (iii) dividends and distributions in respect of Disqualified Equity
Interests actually paid in cash by the Company or any Restricted Subsidiary
(other than to the Company or another Restricted Subsidiary) during such period
as determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to any period,
the net income of the Company and the Restricted Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP, adjusted, to the
extent included in calculating such net income, by excluding, without
duplication, (a) other than for purposes of calculating the Basket, all
extraordinary gains or losses for such period, (b) other than for purposes of
calculating the Basket, all gains or losses from the sales or other dispositions
of assets out of the ordinary course of business (net of taxes, fees and
expenses relating to the transaction giving rise thereto) for such period; (c)
that portion of such net income derived from or in respect of investments in
Persons other than Restricted Subsidiaries, except to the extent actually
received in cash by the Company or any Restricted Subsidiary (subject, in the
case of any Restricted Subsidiary, to the provisions of clause (f) of this
definition); (d) the portion of such net income (or loss) allocable to minority
interests in any Person (other than a Restricted Subsidiary) for such period,
except to the extent the Company's allocable portion of such Person's net income
for such period is actually received in cash by the Company or any Restricted
Subsidiary (subject, in the case of any Restricted Subsidiary, to the provisions
of clause (f) of this definition); (e) the net income (or loss) of any other
Person combined with the Company or any Restricted Subsidiary on a "pooling of
interests" basis attributable to any period prior to the date of combination;
and (f) the net income of any Restricted Subsidiary to the extent that the
declaration of dividends or similar distributions by that Restricted Subsidiary
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of that income is not at the time (regardless of any waiver) permitted, directly
or indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulations
applicable to that Restricted Subsidiary or its Equity Interest holders.
"Consolidated Operating Cash Flow" means, with respect to any
period, Consolidated Net Income for such period increased (without duplication),
to the extent deducted in calculating such Consolidated Net Income, by (a)
Consolidated Income Tax Expense for such period; (b) Consolidated Interest
Expense for such period; and (c) depreciation, amortization and any other
non-cash items for such period (other than any non-cash item which requires the
accrual of, or a reserve for, cash charges for any future period) of the Company
and the Restricted Subsidiaries, including, without limitation, amortization of
capitalized debt issuance costs for such period, all of the foregoing determined
on a consolidated basis in accordance with GAAP minus non-cash items to the
extent they increase Consolidated Net Income (including the partial or entire
reversal of reserves taken in prior periods) for such period.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 10.02 or such other address as the
Trustee may give notice to the Company.
"CT Corporation System" see Section 10.14.
"Cumulative Operating Cash Flow" means, as at any date of
determination, the positive cumulative Consolidated Operating Cash Flow realized
during the period commencing on the Issue Date and ending on the last day of the
most recent fiscal quarter immediately preceding the date of determination for
which consolidated financial information of the Company is available or, if such
cumulative Consolidated Operating Cash Flow for such period is negative, the
negative amount by which cumulative Consolidated Operating Cash Flow is less
than zero.
"Currency Agreement" shall mean any foreign exchange contract,
currency swap agreement or other similar agreement or arrangement, which may
include the use of derivatives, designed to protect the Company or any
Restricted Subsidiary against fluctuations in currency values.
"Custodian" see Section 6.01.
"Debt to Annualized Operating Cash Flow Ratio" means the ratio
of (a) the Total Consolidated Indebtedness as of the date of calculation (the
"Determination Date") to (b) two times the Consolidated Operating Cash Flow for
the latest two fiscal quarters for which financial information is available
immediately preceding such Determination Date (the "Measurement Period"). For
purposes of calculating Consolidated Operating Cash Flow for the Measurement
Period immediately prior to the relevant Determination Date, (I) any Person that
is a Restricted Subsidiary on the Determination Date (or would become a
Restricted Subsidiary on such Determination Date in connection with the
transaction that requires the determination of such Consolidated Operating Cash
Flow) will be deemed to have been a Restricted Subsidiary at all times during
such Measurement Period, (II) any Person that is not a Restricted Subsidiary on
such Determination Date (or would cease to be a Restricted Subsidiary on such
Determination Date in connection with the transaction that requires the
determination of such Consolidated Operating Cash Flow) will be deemed not to
have been a Restricted Subsidiary at any time during such Measurement Period,
and (III) if the Company or any Restricted Subsidiary shall have in any manner
(x) acquired (through an Acquisition or the commencement of activities
constituting such operating business) or (y) disposed of (by way of an Asset
Sale or the termination or discontinuance of activities constituting such
operating business) any operating business during such Measurement Period or
after the end of such period and on or prior to such Determination Date, such
calculation will be made on a pro
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forma basis in accordance with GAAP as if, in the case of an Acquisition or the
commencement of activities constituting such operating business, all such
transactions had been consummated on the first day of such Measurement Period
and, in the case of an Asset Sale or termination or discontinuance of activities
constituting such operating business, all such transactions had been consummated
prior to the first day of such Measurement Period (it being understood that in
calculating Consolidated Operating Cash Flow the exclusions set forth in clauses
(a) through (f) of the definition of Consolidated Net Income shall apply to an
Acquired Person as if it were a Restricted Subsidiary).
"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.
"Depository" means, with respect to the Securities issued in
the form of one or more Global Securities, The Depository Trust Company or
another Person designated as Depository by the Company, which must be a clearing
agency registered under the Exchange Act.
"Designation" see Section 4.14.
"Designation Amount" see Section 4.14.
"Determination Date" has the meaning set forth in the
definition of "Debt to Annualized Operating Cash Flow Ratio" above.
"Disinterested Director" means a member of the Board of
Directors of the Company who does not have any material direct or indirect
financial interest in or with respect to the transaction being considered.
"Disposition" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the Surviving Person) or the sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of such
Person's assets.
"Disqualified Equity Interest" means any Equity Interest
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the holder
thereof), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable,
at the option of the holder thereof, in whole or in part, on or prior to the
Maturity Date; provided, however, that any Equity Interests that would not
constitute Disqualified Equity Interests but for provisions thereof giving
holders thereof the right to require the Company to repurchase or redeem such
Equity Interests upon the occurrence of a change in control occurring prior to
the Maturity Date shall not constitute Disqualified Equity Interests if the
change in control provisions applicable to such Equity Interests are no more
favorable to the holders of such Equity Interests than the provisions under
Section 4.10 and such Equity Interests specifically provide that the Company
will not repurchase or redeem any such Equity Interests pursuant to such
provisions prior to the Company's repurchase of Securities as are required to be
repurchased pursuant to the provisions under Section 4.10.
"Dollar Equivalent" shall mean, with respect to a monetary
amount in a currency other than U.S. Dollars, at any time for the determination
thereof, the amount of U.S. Dollars obtained by converting such other currency
involved in such computation into U.S. dollars at the rate for the purchase of
U.S. dollars with the applicable currency as set forth in the Key Currency Cross
Rates table of The Wall Street Journal (or a successor table) on the date that
is two Business Days prior to such determination.
13
-7-
"Equity Interest" in any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) corporate stock or other
equity participations, including partnership interests, whether general or
limited, in such Person, including any Preferred Equity Interests.
"Escrow Account" has the meaning set forth in Section 2 of the
Escrow Agreement.
"Escrow Agent" means The Bank of New York, as escrow agent
under the Escrow Agreement, until a successor replaces it in accordance with the
provisions of the Escrow Agreement and thereafter means such successor.
"Escrow Agreement" means the Escrow Agreement dated as of
August 19, 1997 among the Company, the Escrow Agent and the Trustee.
"Event of Default" see Section 6.01.
"Escrow Funds" see Section 11.03.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
"Expiration Date" has the meaning set forth in the definition
of "Offer to Purchase" below.
"Fair Market Value" means, with respect to any asset, the
price (after taking into account any liabilities relating to such assets) which
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of which is under
any compulsion to complete the transaction; provided, however, that the Fair
Market Value of any such asset or assets shall be determined conclusively by the
Board of Directors of the Company acting in good faith, which determination
shall be evidenced by a resolution of such Board delivered to the Trustee.
"GAAP" means, at any date of determination, generally accepted
accounting principles in effect in the United States which are applicable at the
date of determination and which are consistently applied for all applicable
periods.
"Global Security" means a security evidencing all or a portion
of the Securities issued to the Depository or its nominee in accordance with
Section 2.01 and bearing the legend set forth in Exhibit C hereto.
"GTS" means Global TeleSystems Group, Inc., a Delaware
corporation, and its successors.
"GTS Contribution" means one or more investments, on and after
the Issue Date, in the Company (other than by a Subsidiary of the Company) of
not less than ECU 46.0 million (the equivalent of $51.1 million on July 7,
1997), in the aggregate, by capital contribution to the Company, purchase from
the Company of common Equity Interests of the Company and conversion of
Indebtedness owing to GTS-Hermes, Inc. by the Company into common Equity
Interests of the Company.
"guarantee" means, as applied to any obligation, (i) a
guarantee (other than by endorsement of negotiable instruments for collection in
the ordinary course of business), direct or indirect, in any manner, of any part
or all of such obligation and (ii) an agreement, direct or indirect, contingent
or otherwise, the
14
-8-
practical effect of which is to assure in any way the payment or performance (or
payment of damages in the event of non-performance) of all or any part of such
obligation, including, without limiting the foregoing, the payment of amounts
drawn down by letters of credit. A guarantee shall include, without limitation,
any agreement to maintain or preserve any other person's financial condition or
to cause any other Person to achieve certain levels of operating results.
"Holder," "holder of Securities," "Securityholders" or other
similar terms mean the registered holder of any Security.
"Incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (including by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such Person (and "Incurrence," "Incurred" and "Incurring" shall
have meanings correlative to the foregoing). Indebtedness of a Person existing
at the time such Person becomes a Restricted Subsidiary or is merged or
consolidated with or into the Company or any Restricted Subsidiary shall be
deemed to be Incurred at such time.
"Indebtedness" means (without duplication), with respect to
any Person, whether recourse is to all or a portion of the assets of such Person
and whether or not contingent, (a) every obligation of such Person for money
borrowed; (b) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses; (c) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person; (d)
every obligation of such Person issued or assumed as the deferred purchase price
of property or services (but excluding trade accounts payable incurred in the
ordinary course of business and payable in accordance with industry practices,
or other accrued liabilities arising in the ordinary course of business which
are not overdue or which are being contested in good faith); (e) every Capital
Lease Obligation of such Person; (f) every net obligation under interest rate
swap or similar agreements or foreign currency hedge, exchange or similar
agreements of such Person; (g) every obligation of the type referred to in
clauses (a) through (f) of another Person and all dividends of another Person
the payment of which, in either case, such Person has guaranteed or is
responsible or liable for, directly or indirectly, as obligor, guarantor or
otherwise; and (h) any and all Refinancings of, or amendments, modifications or
supplements to, any liability of the kind described in any of the preceding
clauses (a) through (g) above. Indebtedness (i) shall never be calculated taking
into account any cash and cash equivalents held by such Person; (ii) shall not
include obligations of any Person (x) arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently drawn against insufficient funds in the ordinary course of
business, provided that such obligations are extinguished within two Business
Days of their incurrence unless covered by an overdraft line, (y) resulting from
the endorsement of negotiable instruments for collection in the ordinary course
of business and consistent with past business practices and (z) under stand-by
letters of credit to the extent collateralized by cash or Cash Equivalents;
(iii) which provides that an amount less than the principal amount thereof shall
be due upon any declaration of acceleration thereof shall be deemed to be
Incurred or outstanding in an amount equal to the accreted value thereof at the
date of determination determined in accordance with GAAP; and (iv) shall include
the liquidation preference and any mandatory redemption payment obligations in
respect of any Disqualified Equity Interests of the Company or any Preferred
Equity Interests of any Restricted Subsidiary.
"Indenture" means this Indenture as amended or supplemented
from time to time.
15
-9-
"Independent Financial Advisor" means a recognized,
accounting, appraisal, investment banking firm or consultant with experience in
a Telecommunications Business (i) which does not, and whose directors, officers
and employees or Affiliates do not, have a material direct or indirect financial
interest in the Company and (ii) which, in the judgment of the Board of
Directors of the Company, is otherwise independent and qualified to perform the
task for which it is to be engaged.
"Initial Purchasers" means Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation, UBS Securities LLC and Xxxxxx Brothers Inc.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" as that term is defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act.
"interest" means, with respect to the Securities, the sum of
any cash interest and any Additional Interest on the Securities.
"Interest Payment Date" means each semiannual interest payment
date on February 15 and August 15 of each year, commencing February 15, 1998.
"Interest Rate Protection Obligations" means, with respect to
any Person, the Obligations of such Person under (i) interest rate swap
agreements, interest rate cap agreements and interest rate collar agreements,
and (ii) other agreements or arrangements designed to protect such Person
against fluctuations in interest rates.
"Interest Record Date" for the interest payable on any
Interest Payment Date (except a date for payment of defaulted interest) means
the February 1 or August 1 (whether or not a Business Day), as the case may be,
immediately preceding such Interest Payment Date.
"Investment" means, with respect to any Person, any direct or
indirect loan, advance, guarantee or other extension of credit or capital
contribution to (by means of transfers of cash or other property or assets to
others or payments for property or services for the account or use of others, or
otherwise), or purchase or acquisition of capital stock, bonds, notes,
debentures or other securities or evidences of Indebtedness issued by, any other
Person. The amount of any Investment shall be the original cost of such
Investment, plus the cost of all additions thereto, and minus the amount of any
portion of such Investment repaid to such Person in cash as a repayment of
principal or a return of capital, as the case may be, but without any other
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment. In determining the amount of any
investment involving a transfer of any property or asset other than cash, such
property shall be valued at its Fair Market Value at the time of such transfer.
"Investments" shall exclude extensions of trade credit in the ordinary course of
business in accordance with normal trade practices.
"Issue Date" means the original issue date of the Securities.
"Judgment Currency" see Section 10.15.
"Latest Balance Sheet" means, of any Person, the latest
consolidated balance sheet of such Person reported on by a recognized firm of
independent accountants without qualification as to scope; provided, however,
that such balance sheet is as of a date within the past 135 days.
16
-10-
"Lien" means any lien, mortgage, charge, security interest,
hypothecation, assignment for security or encumbrance of any kind (including any
conditional sale or capital lease or other title retention agreement, any lease
in the nature thereof, and any agreement to give any security interest).
"Maturity Date" means the date, which is set forth on the face
of the Securities, on which the Securities will mature.
"Measurement Period" has the meaning set forth in the
definition of "Debt to Annualized Operating Cash Flow Ratio" above.
"Monetization Sale" see Section 4.16.
"Net Cash Proceeds" means the aggregate proceeds in the form
of cash or Cash Equivalents received by the Company or any Restricted Subsidiary
in respect of any Asset Sale, including all cash or Cash Equivalents received
upon any sale, liquidation or other exchange of proceeds of Asset Sales received
in a form other than cash or Cash Equivalents, net of (a) 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; (b) taxes paid or payable as a result thereof
(after taking into account any available tax credits or deductions and any tax
sharing arrangements); (c) amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the asset or assets that were the subject of
such Asset Sale; (d) amounts deemed, in good faith, appropriate by the Board of
Directors of the Company to be provided as a reserve, in accordance with GAAP,
against any liabilities associated with such assets which are the subject of
such Asset Sale (provided that the amount of any such reserves shall be deemed
to constitute Net Cash Proceeds at the time such reserves shall have been
released or are not otherwise required to be retained as a reserve); and (e)
with respect to Asset Sales by Subsidiaries, the portion of such cash payments
attributable to Persons holding a minority interest in such Subsidiary.
"Non-U.S. Person" means a person who is not a U.S. Person, as
defined in Regulation S.
"Obligations" means any principal, interest (including,
without limitation, post-petition interest), penalties, fees, indemnifications,
reimbursement obligations, damages and other liabilities payable under the
documentation governing any Indebtedness.
"Offer" has the meaning set forth in the definition of "Offer
to Purchase" below.
"Offer to Purchase" means a written offer (the "Offer") sent
by or on behalf of the Company by first-class mail, postage prepaid, to each
holder at his address appearing in the register for the Securities on the date
of the Offer offering to purchase up to the principal amount of Securities
specified in such Offer at the purchase price specified in such Offer (as
determined pursuant to the Indenture). Unless otherwise required by applicable
law, the Offer shall specify an expiration date (the "Expiration Date") of the
Offer to Purchase, which shall be not less than 20 Business Days nor more than
90 days after the date of such Offer, and a settlement date (the "Purchase
Date") for purchase of Securities to occur no later than five Business Days
after the Expiration Date. The Company shall notify the Trustee at least 15
Business Days (or such shorter period as is acceptable to the Trustee) prior to
the mailing of the Offer of the Company's obligation to make an Offer to
Purchase, and the Offer shall be mailed by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company. The Offer
shall contain all the information required by applicable law to be included
therein. The Offer shall contain all instructions and materials necessary to
enable such Holders to tender Securities pursuant to the Offer to Purchase. The
Offer shall also state:
17
-11-
(1) the Section of this Indenture pursuant to which the Offer
to Purchase is being made;
(2) the Expiration Date and the Purchase Date;
(3) the aggregate principal amount of the outstanding
Securities offered to be purchased by the Company pursuant to the Offer
to Purchase (including, if less than 100%, the manner by which such
amount has been determined pursuant to the Section of this Indenture
requiring the Offer to Purchase) (the "Purchase Amount");
(4) the purchase price to be paid by the Company for each
$1,000 aggregate principal amount of Securities accepted for payment
(as specified pursuant to the Indenture) (the "Purchase Price");
(5) that the holder may tender all or any portion of the
Securities registered in the name of such holder and that any portion
of a Security tendered must be tendered in an integral multiple of
$1,000 principal amount at maturity;
(6) the place or places where Securities are to be surrendered
for tender pursuant to the Offer to Purchase;
(7) that interest on any Security not tendered or tendered but
not purchased by the Company pursuant to the Offer to Purchase will
continue to accrue;
(8) that on the Purchase Date the Purchase Price will become
due and payable upon each Security being accepted for payment pursuant
to the Offer to Purchase and that interest thereon shall cease to
accrue on and after the Purchase Date;
(9) that each holder electing to tender all or any portion of
a Security pursuant to the Offer to Purchase will be required to
surrender such Security at the place or places specified in the Offer
prior to the close of business on the Expiration Date (such Security
being, if the Company or the Trustee so requires, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the holder thereof or his
attorney duly authorized in writing);
(10) that holders will be entitled to withdraw all or any
portion of Securities tendered if the Company (or its Paying Agent)
receives, not later than the close of business on the fifth Business
Day next preceding the Expiration Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the holder, the
principal amount of the Security the holder tendered, the certificate
number of the Security the holder tendered and a statement that such
holder is withdrawing all or a portion of his tender;
(11) that (a) if Securities in an aggregate principal amount
less than or equal to the Purchase Amount are duly tendered and not
withdrawn pursuant to the Offer to Purchase, the Company shall purchase
all such Securities and (b) if Securities in an aggregate principal
amount in excess of the Purchase Amount are tendered and not withdrawn
pursuant to the Offer to Purchase, the Company shall purchase
Securities having an aggregate principal amount equal to the Purchase
Amount on a pro rata basis (with such adjustments as may be deemed
appropriate so that only Securities in denominations of $1,000
principal amount at maturity or integral multiples thereof shall be
purchased); and
18
-12-
(12) that in the case of any holder whose Security is
purchased only in part, the Company shall execute and the Trustee shall
authenticate and deliver to the holder of such Security without service
charge, a new Security or Securities, of any authorized denomination as
requested by such holder, in an aggregate principal amount equal to and
in exchange for the unpurchased portion of the Security so tendered.
An Offer to Purchase shall be governed by and effected in
accordance with the provisions above pertaining to any Offer.
"Officer" means the Chairman, any Vice Chairman, the
President, any Vice President, the Chief Financial Officer, the Treasurer, or
the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers or by an Officer and an Assistant Treasurer or Assistant Secretary of
the Company complying with Sections 10.04 and 10.05.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. The counsel may be an
employee of or counsel to the Company.
"Other Debt" see Section 4.16.
"Participant" see Section 2.15.
"Permitted Holders" means GTS or any of its Affiliates.
"Permitted Investments" means (a) Cash Equivalents; (b)
Investments in prepaid expenses, negotiable instruments held for collection and
lease, utility and workers' compensation, performance and other similar
deposits; (c) loans and advances to employees made in the ordinary course of
business not to exceed $3,000,000 in the aggregate at any one time outstanding;
(d) Interest Rate Protection Obligations and Currency Agreements permitted under
Section 4.12; (e) bonds, notes, debentures or other securities received as a
result of Asset Sales permitted under Section 4.16; (f) transactions with
officers, directors and employees of the Company or any Restricted Subsidiary
entered into in the ordinary course of business (including compensation or
employee benefit arrangements with any such director or employee) and consistent
with past business practices; (g) Investments made in the ordinary course of
business and on ordinary business terms as partial payment for constructing a
network relating principally to a Telecommunications Business; (h) Investments
in any Restricted Subsidiary; (i) intercompany Indebtedness to the extent
permitted under Section 4.12(b)(v); (i) Investments by the Company or any
Restricted Subsidiary in another Person, if as a result of such Investment (x)
such other Person becomes a Restricted Subsidiary or (y) such other Person is
merged or consolidated with or into, or transfers or conveys all or
substantially all of its assets to, the Company or a Restricted Subsidiary; and
(j) Investments in evidences of Indebtedness, securities or other property
received from another Person by the Company or any Restricted Subsidiary in
connection with any bankruptcy proceeding or by reason of a composition or
readjustment of debt or a reorganization of such Person or as a result of
foreclosure, perfection or enforcement of any Lien in exchange for evidences of
Indebtedness, securities or other property of such Person held by the Company or
any Restricted Subsidiary, or for other liabilities or obligations of such other
Person to the Company or any Restricted Subsidiary that were created in
accordance with the terms of this Indenture.
"Permitted Liens" means (a) Liens on property of a Person
existing at the time such Person is merged into or consolidated with the Company
or any Restricted Subsidiary; provided, however, that such
19
-13-
Liens were in existence prior to the contemplation of such merger or
consolidation and do not secure any property or assets of the Company or any
Restricted Subsidiary other than the property or assets subject to the Liens
prior to such merger or consolidation; (b) Liens existing on the Issue Date; (c)
Liens securing Indebtedness consisting of Capitalized Lease Obligations,
mortgage financings, industrial revenue bonds or other monetary obligations, in
each case incurred solely for the purpose of financing all or any part of the
purchase price or cost of construction or installation of assets used in the
business of the Company or any Restricted Subsidiary, or repairs, additions or
improvements to such assets; provided, however, that (I) such Liens secure
Indebtedness in an amount not in excess of the original purchase price or the
original cost of any such assets or repair, addition or improvement thereto
(plus an amount equal to the reasonable fees and expenses in connection with the
Incurrence of such Indebtedness), (II) such Liens do not extend to any other
assets of the Company or any Restricted Subsidiary (and, in the case of repair,
addition or improvements to any such assets, such Lien extends only to the
assets (and improvements thereto or thereon) repaired, added to or improved),
(III) the Incurrence of such Indebtedness is permitted by Section 4.12 and (IV)
such Liens attach within 90 days of such purchase, construction, installation,
repair, addition or improvement; (d) Liens to secure any Refinancings, in whole
or in part, of any Indebtedness secured by Liens referred to in the clauses
above so long as such Lien does not extend to any other property (other than
improvements thereto); (e) Liens securing letters of credit entered into in the
ordinary course of business and consistent with past business practice; (f)
Liens on and pledges of the capital stock of any Unrestricted Subsidiary
securing any Indebtedness of such Unrestricted Subsidiary; (g) Liens on any
property or assets of a Restricted Subsidiary granted in favor of and held by
the Company or any Restricted Subsidiary; (h) Liens on any property or assets of
the Company or any Restricted Subsidiary securing on a pari passu basis all of
the Securities; (i) statutory Liens of landlords and carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen or other like Liens arising in the
ordinary course of business of the Company or any Restricted Subsidiary and with
respect to amounts not yet delinquent or being contested in good faith by
appropriate proceedings; (j) Liens for taxes, assessments, government charges or
claims that are being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted; provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall have
been made therefor; (k) Liens incurred or deposits made to secure the
performance of tenders, bids, leases, statutory obligations, surety and appeal
bonds, government contracts, performance bonds and other obligations of a like
nature incurred in the ordinary course of business (other than contracts for the
payment of money); (l) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with the
business of the Company or any Restricted Subsidiary incurred in the ordinary
course of business; (m) Liens arising by reason of judgment, decree or order of
any court so long as such Lien is adequately bonded and any appropriate legal
proceedings that may have been duly initiated for the review of such judgment,
decree or order shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired; (n) Liens
securing Qualified Subsidiary Indebtedness to the extent permitted to be
Incurred under Section 4.12; (o) Liens securing Indebtedness under Interest Rate
Protection Obligations or Indebtedness under Currency Agreements to the extent
permitted to be Incurred under Section 4.12; and (p) Liens incurred or deposits
made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security.
"Permitted Refinancing" means, with respect to any
Indebtedness, Indebtedness to the extent representing a Refinancing of such
Indebtedness; provided, however, that (1) the Refinancing Indebtedness shall not
exceed the sum of the amount of the Indebtedness being Refinanced, plus the
amount of accrued interest or dividends thereon, the amount of any reasonably
determined prepayment premium necessary to accomplish such Refinancing and
reasonable fees and expenses incurred in connection therewith; (2) the
Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to
or greater than the Weighted Average Life to Maturity of the Indebtedness being
Refinanced and shall not permit redemption or other re-
20
-14-
tirement (including pursuant to any required offer to purchase to be made by the
Company or any Restricted Subsidiary) of such Indebtedness at the option of the
holder thereof prior to the final stated maturity of the Indebtedness being
Refinanced, other than a redemption or other retirement at the option of the
holder of such Indebtedness (including pursuant to a required offer to purchase
made by the Company or a Restricted Subsidiary) upon a change of control of the
Company pursuant to provisions substantially similar to those under Section
4.10; (3) Indebtedness that ranks pari passu with the Securities may be
Refinanced only with Indebtedness that is made pari passu with or subordinate in
right of payment to the Securities, and Indebtedness that is subordinated in
right of payment to the Securities may be Refinanced only with Indebtedness that
is subordinate in right of payment to the Securities on terms no less favorable
to the Holders than those contained in the Indebtedness being Refinanced; and
(4) the Refinancing Indebtedness shall be Incurred by the obligor on the
Indebtedness being Refinanced or by the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, limited
liability partnership, limited partnership, trust, unincorporated organization
or government or any agency or political subdivision thereof.
"Physical Securities" has the meaning set forth in Section
2.01.
"Preferred Equity Interest" in any Person, means an Equity
Interest of any class or classes (however designated) which is preferred as to
the payment of dividends or distributions, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over Equity Interests of any other class in such Person.
"principal" of a debt security means the principal of the
security, plus, when appropriate, the premium, if any, on the security.
"Private Placement Legend" means the legend initially set
forth on the Series A Securities in the form set forth on Exhibit A hereto.
"Public Equity Offering" means an underwritten public offering
of common Equity Interests of the Company pursuant to an effective registration
statement filed under the Securities Act (excluding registration statements
filed on Form S-8).
"Purchase Amount" has the meaning set forth in the definition
of "Offer to Purchase" above.
"Purchase Date" has the meaning set forth in the definition of
"Offer to Purchase" above.
"Purchase Price" has the meaning set forth in the definition
of "Offer to Purchase" above.
"QIB Global Security" see Section 2.01.
"Qualified Equity Interest" means any Equity Interest of the
Company other than any Disqualified Equity Interest.
"Qualified Institutional Buyer" or "QIB" means a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act.
21
-15-
"Qualified Subsidiary Indebtedness" means (i) Indebtedness of
Restricted Subsidiaries under one or more senior credit agreements, senior loan
agreements or similar senior facilities, secured or unsecured, entered into from
time to time, including any related notes, guarantees collateral documents,
instruments and agreements executed in connection therewith or (ii) Indebtedness
of Restricted Subsidiaries in an aggregate principal amount not to exceed $25.0
million in the aggregate at any time outstanding.
"Rating Agencies" shall mean (i) S&P and (ii) Moody's and
(iii) if S&P or Moody's or both shall not make a rating of the Securities
publicly available, a nationally recognized securities rating agency or
agencies, as the case may be, selected by the Company, which shall be
substituted for S&P or Moody's or both, as the case may be.
"Redemption Date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption pursuant to this
Indenture.
"Redemption Price," when used with respect to any Security to
be redeemed, means the price fixed for such redemption pursuant to this
Indenture as set forth in the form of Security annexed hereto as Exhibit A or
Exhibit B hereto.
"Refinance" means refinance, renew, extend, replace, defease
or refund; and "Refinancing" and "Refinanced" have correlative meanings.
"Registered Exchange Offer" means the offer to exchange the
Series B Securities for all of the outstanding Series A Securities in accordance
with the Registration Rights Agreement.
"Registrar" see Section 2.03.
"Registration" means the Registered Exchange Offer by the
Company or other registration of the Series A Securities under the Securities
Act pursuant to and in accordance with the terms of the Registration Rights
Agreement.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of August 19, 1997 between the Company and the Initial
Purchasers.
"Registration Statement" means the registration statement(s)
as defined and described in the Registration Rights Agreement.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Security" see Section 2.01.
"Replacement Assets" means (x) properties and assets (other
than cash or any Equity Interests or other security) that will be used in a
Telecommunications Business of the Company and the Restricted Subsidiaries or
(y) Equity Interests of any Person engaged primarily in a Telecommunications
Business, which Person will become on the date of acquisition thereof a
Restricted Subsidiary as a result of the Company's acquiring such Equity
Interests.
"Required Filing Date" see Section 4.09.
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"Restricted Payments" see Section 4.11.
"Restricted Security" has the meaning set forth in Rule
144(a)(3) under the Securities Act or any successor to such rule; provided,
however, that the Trustee shall be entitled to request and conclusively rely
upon an Opinion of Counsel with respect to whether any Security is a Restricted
Security.
"Restricted Subsidiary" means any Subsidiary of the Company
that has not been designated by the Board of Directors of the Company, by a
resolution of the Board of Directors of the Company delivered to the Trustee, as
an Unrestricted Subsidiary pursuant to Section 4.14. Any such designation may be
revoked by a resolution of the Board of Directors of the Company delivered to
the Trustee, subject to the provisions of such covenant.
"Revocation" see Section 4.14.
"Rule 144A" means Rule 144A under the Securities Act or any
successor thereto.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Series A Securities and the Series B
Securities treated as a single class of securities, as amended or supplemented
from time to time in accordance with the terms of this Indenture.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"Securities Amount" see Section 4.16.
"Securities Portion of Unutilized Net Cash Proceeds" see
Section 4.16.
"Series A Securities" means the 11-1/2% Senior Notes due 2007
of the Company issued pursuant to this Indenture and sold pursuant to the
Purchase Agreement.
"Series B Securities" means the 11-1/2% Senior Notes due 2007,
Series B, of the Company to be issued pursuant to this Indenture in exchange for
the Series A Securities pursuant to the Registered Exchange Offer and the
Registration Rights Agreement.
"Share Capital" shall mean, at any time of determination, the
stated capital of the Equity Interests (other than Disqualified Stock) and
additional paid-in capital of the Company at such time, all as determined in
accordance with GAAP.
"Significant Restricted Subsidiary" means, at any date of
determination, (a) any Restricted Subsidiary that, together with its
Subsidiaries that constitute Restricted Subsidiaries (i) for the most recent
fiscal year of the Company accounted for more than 10.0% of the consolidated
revenues of the Company and the Restricted Subsidiaries or (ii) as of the end of
such fiscal year, owned more than 10.0% of the consolidated assets of the
Company and the Restricted Subsidiaries, all as set forth on the consolidated
financial statements of the Company and the Restricted Subsidiaries for such
year prepared in conformity with GAAP, and (b) any Restricted Subsidiary which,
when aggregated with all other Restricted Subsidiaries that are not otherwise
Sig-
23
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nificant Restricted Subsidiaries and as to which any event described in Section
6.01(8) or (9) has occurred and is continuing, would constitute a Significant
Restricted Subsidiary under clause (a) of this definition.
"Stated Maturity", when used with respect to any Security or
any installment of interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Strategic Equity Investments" means the issuance and sale of
Qualified Equity Interests to a Person that has an equity market capitalization,
a net asset value or annual revenues of at least $1.5 billion and owns and
operates business primarily in a Telecommunication Business.
"Subordinated Indebtedness" means any Indebtedness of the
Company which is expressly subordinated in right of payment to the Securities.
"Subsidiary" means, with respect to any Person, (a) any
corporation of which the outstanding Voting Equity Interests having at least a
majority of the votes entitled to be cast in the election of directors shall at
the time be owned, directly or indirectly, by such Person, or (b) any other
Person of which at least a majority of Voting Equity Interests are at the time,
directly or indirectly, owned by such first named Person.
"Surviving Person" means, with respect to any Person involved
in or that makes any Disposition, the Person formed by or surviving such
Disposition or the Person to which such Disposition is made.
"Tax" shall mean any tax, duty, levy, impost, assessment or
other governmental charge (including penalties, interest and any other
liabilities related thereto).
"Taxing Authority" shall mean any government or political
subdivision or territory or possession of any government or any authority or
agency therein or thereof having power to tax.
"Telecommunications Acquisition" means an Acquisition of
properties or assets to be used in a Telecommunications Business or of the
Equity Interests of any Person that becomes a Restricted Subsidiary; provided,
however, that such Person's properties and assets shall consist principally of
properties or assets that will be used in a Telecommunications Business.
"Telecommunications Business" means any business owning,
constructing, financing and operating a telephone and/or communications system
located entirely in countries located in Western and Central Europe, or any
business reasonably related thereto, including, without limitation, any business
conducted by the Company or any Restricted Subsidiary on the Issue Date.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Section 77aaa-77bbbb), as amended, as in effect on the date of this Indenture
until such time as this Indenture is qualified under the TIA, and thereafter as
in effect on the date on which this Indenture is qualified under the TIA, except
in each case as provided in Section 9.03.
"Total Consolidated Indebtedness" means, as at any date of
determination, an amount equal to the aggregate amount of all Indebtedness of
the Company and the Restricted Subsidiaries, on a consolidated basis,
outstanding as of such date of determination, after giving effect to any
Incurrence of Indebtedness and the application of the proceeds therefrom giving
rise to such determination.
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"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"Trust Officer" means any officer within the corporate trust
department (or any successor group of the Trustee) including any vice president,
assistant vice president, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such trust matter is referred because of his knowledge of and familiarity
with the particular subject.
"Unrestricted Subsidiary" means any Subsidiary of the Company
designated as such pursuant to Section 4.14. Any such designation may be revoked
by a resolution of the Board of Directors of the Company delivered to the
Trustee, subject to the provisions of Section 4.14.
"Unutilized Net Cash Proceeds" see Section 4.16(a).
"U.S. Government Obligations" means direct non-callable
obligations of, or obligations guaranteed by, the United States of America for
the payment of which guarantee or obligations the full faith and credit of the
United States is pledged.
"U.S. Person" means a "U.S. person" as defined in Rule 902
under the Securities Act or any successor to such Rule.
"Voting Equity Interests" means Equity Interests in a
corporation or other Person with voting power under ordinary circumstances
entitling the holders thereof to elect the Board of Directors or other governing
body of such corporation or Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the sum
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or other required scheduled payment
of principal, including payment of final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment, by (b) the then outstanding
aggregate principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" means any Restricted
Subsidiary all of the outstanding Voting Equity Interests (other than directors'
qualifying shares) of which are owned, directly or indirectly, by the Company.
SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
25
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"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company or any
other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule and
not otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. 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 generally accepted accounting
principles in effect from time to time, and any other reference in this
Indenture to "generally accepted accounting principles" refers to GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions;
and
(6) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section
or other subdivision.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Series A Securities and the Trustee's certificate of
authentication thereof shall be substantially in the form of Exhibit A hereto,
which is hereby incorporated in and expressly made a part of this Indenture. The
Series B Securities and the Trustee's certificate of authentication thereof
shall be substantially in the form of Exhibit B hereto, which is hereby
incorporated in and expressly made a part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rule or
usage. The Company and the Trustee shall approve the form of the Securities and
any notation, legend or endorse-
26
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ment on them. Each Security shall be dated the date of its issuance and shall
show the date of its authentication.
Securities initially offered and sold by the Initial
Purchasers shall, unless the applicable Holder requests Securities in the form
of certificated Securities in registered form ("Physical Securities"), which
shall be in substantially the form set forth in Exhibit A hereto, be issued
initially in the form of one or more permanent Global Securities in registered
form, substantially in the form set forth in Exhibit A hereto, deposited with
the Trustee, as custodian for the Depository, and shall bear the legend set
forth in Exhibit C hereto. One or more separate Global Securities shall be
issued to represent Securities held by (i) Qualified Institutional Buyers (a
"QIB Global Security") and (ii) Persons acquiring Securities in offshore
transactions in reliance on Regulation S (a "Regulation S Global Security"). The
Company shall cause the QIB Global Securities and Regulation S Global Securities
to have separate CUSIP numbers.
Upon consummation of the Registration, Series B Securities may
be issued in the form of one or more permanent Global Securities in registered
form, substantially in the form set forth in Exhibit B hereto, deposited with
the Trustee, as custodian for the Depository, and shall bear the legend set
forth on Exhibit C hereto.
The aggregate principal amount of any Global Security may from
time to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depository, as hereinafter provided.
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall
sign, or one Officer shall sign and one Officer or an Assistant Secretary (each
of whom shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to, the Securities for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Security was an Officer
at the time of such execution but no longer holds that office at the time the
Trustee authenticates the Security, the Security shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee shall authenticate (i) Series A Securities for
original issue in the aggregate principal amount not to exceed $265,000,000 and
(ii) Series B Securities from time to time only in exchange for a like principal
amount of Series A Securities in accordance with the Registration Rights
Agreement, in each case upon a written order of the Company in the form of an
Officers' Certificate. The Officers' Certificate shall specify the amount of
Securities to be authenticated, the series of Securities and the date on which
the Securities are to be authenticated. The aggregate principal amount of
Securities outstanding at any time may not exceed $265,000,000, except as
provided in Section 2.07. Upon receipt of a written order of the Company in the
form of an Officers' Certificate, the Trustee shall authenticate Securities in
substitution for Securities originally issued to reflect any name change of the
Company.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Securities. Unless otherwise provided
in the appointment, an authenticating agent may authenti-
27
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cate Securities 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
and Affiliates of the Company.
The Securities shall be issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York, and, so long as the Securities are listed on
the Luxembourg Stock Exchange and the rules of such stock exchange require, in
Luxembourg where (a) Securities may be presented or surrendered for registration
of transfer or for exchange ("Registrar"), (b) Securities may be presented or
surrendered for payment ("Paying Agent") and (c) notices and demands in respect
of the Securities and this Indenture may be served. The Registrar shall keep a
register or registers of the Securities and of their transfer and exchange. The
Company, upon notice to the Trustee, may appoint one or more co-Registrars and
one or more additional Paying Agents. The term "Paying Agent" includes any
additional Paying Agent. Except as provided herein, the Company, or any
Subsidiary may act as Paying Agent, Registrar or co-Registrar.
The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture, which shall incorporate the
provisions of the TIA. The agreement shall implement the provisions of this
Indenture that relate to such Agent. The Company shall notify the Trustee of the
name and address of any such Agent. If the Company fails to maintain a Registrar
or Paying Agent, or fails to give the foregoing notice, the Trustee shall act as
such and shall be entitled to appropriate compensation in accordance with
Section 7.07.
The Company initially appoints the Trustee as Registrar and
Paying Agent until such time as the Trustee has resigned or a successor has been
appointed.
SECTION 2.04. Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, or interest on, the Securities, and shall notify the
Trustee of any Default by the Company in making any such payment. The Company at
any time may require a Paying Agent to distribute all assets held by it to the
Trustee and account for any assets disbursed and the Trustee may at any time
during the continuance of any payment Default, upon written request to a Paying
Agent, require such Paying Agent to distribute all assets held by it to the
Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent (if other than the Company), the Paying Agent shall have no further
liability for such assets. If the Company, any Subsidiary or any of their
respective Affiliates acts as Paying Agent, it shall, on or before each due date
of the principal of or interest on the Securities, segregate and hold in trust
for the benefit of the Persons entitled thereto a sum sufficient to pay the
principal or interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will promptly notify the
Trustee of its action or failure so to act.
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SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee before each Interest Record Date and at such other times
as the Trustee may request in writing a list as of such date and in such form as
the Trustee may reasonably require of the names and addresses of Holders, which
list may be conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to the provisions of Sections 2.15 and 2.16, when
Securities are presented to the Registrar or a co-Registrar with a request to
register the transfer of such Securities or to exchange such Securities for an
equal principal amount of Securities of other authorized denominations of the
same series, the Registrar or co-Registrar shall register the transfer or make
the exchange as requested if its requirements for such transaction are met;
provided, however, that the Securities surrendered for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Securities at the Registrar's or co-Registrar's
written request. No service charge shall be made 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 other governmental charge
payable upon exchanges or transfers pursuant to Section 2.02, 2.10, 3.06, 4.10,
4.16 or 9.05). The Registrar or co-Registrar shall not be required to register
the transfer or exchange of any Security (i) during a period beginning at the
opening of business 15 days before the mailing of a notice of redemption of
Securities and ending at the close of business on the day of such mailing and
(ii) selected for redemption in whole or in part pursuant to Article Three
hereof, except the unredeemed portion of any Security being redeemed in part.
Prior to the registration of any transfer by a Holder as
provided herein, the Company, the Trustee, and any Agent of the Company shall
treat the person in whose name the Security is registered as the owner thereof
for all purposes whether or not the Security shall be overdue, and neither the
Company, the Trustee, nor any such Agent shall be affected by notice to the
contrary. Any Holder of a Global Security shall, by acceptance of such Global
Security, agree that transfers of beneficial interests in such Global Security
may be effected only through a book-entry system maintained by the Depository
(or its agent), and that ownership of a beneficial interest in a Global Security
shall be required to be reflected in a book entry.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if
the Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Security if the Trustee's requirements for replacement of Securities
are met. Such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Company and the Trustee, to protect the
Company, the Trustee and any Agent from any loss which any of them may suffer if
a Security is replaced and evidence to their satisfaction of the apparent loss,
destruction or theft of such Security. The Company may charge such Holder for
its reasonable out-of-pocket expenses in replacing a Security, including
reasonable fees and expenses of counsel.
Every replacement Security is an additional obligation of the
Company.
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SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that
have been authenticated by the Trustee except those cancelled by it, those
delivered to it for cancellation and those described in this Section 2.08 as not
outstanding. Subject to Section 2.09, a Security does not cease to be
outstanding because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than
a mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If on a Redemption Date, Purchase Date or the Maturity Date
the Paying Agent holds money sufficient to pay all of the principal and interest
due on the Securities payable on that date, then on and after that date such
Securities cease to be outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company or any of its Affiliates shall be disregarded,
except that, for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent, only Securities
that a Trust Officer of the Trustee actually knows are so owned shall be
disregarded.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate upon receipt of a written order of the Company
pursuant to Section 2.02 definitive Securities in exchange for temporary
Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent, and no one else, shall cancel all Securities surrendered for transfer,
exchange, payment or cancellation and deliver to the Company such cancelled
Securities for disposal. Subject to Section 2.07, the Company may not issue new
Securities to replace Securities that it has paid or delivered to the Trustee
for cancellation. If the Company shall acquire any of the Securities, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11. The
Trustee shall cancel all Securities surrendered for transfer, exchange, payment
or cancellation and shall dispose of them in accordance with its normal
procedure.
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SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of principal or interest
on the Securities, it shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the rate per annum borne by the Securities, to the
extent lawful.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities will use one or more
"CUSIP" numbers and the Trustee shall use the appropriate CUSIP number in
notices of redemption or exchange as a convenience to Holders; provided,
however, that any such notice may state that no representation is made as to the
correctness or accuracy of the CUSIP number printed in the notice or on the
Securities, and that reliance may be placed only on the other identification
numbers printed on the Securities. The Company shall promptly notify the Trustee
of any changes in CUSIP numbers.
SECTION 2.14. Deposit of Moneys.
Prior to 10:00 a.m. New York City time on each Interest
Payment Date, Redemption Date, Purchase Date and the Maturity Date, the Company
shall deposit with the Paying Agent in immediately available funds money
sufficient to make cash payments, if any, due on such Interest Payment Date,
Redemption Date, Purchase Date or Maturity Date, as the case may be, in a timely
manner which permits the Paying Agent to remit payment to the Holders on such
Interest Payment Date, Redemption Date, Purchase Date or Maturity Date, as the
case may be.
SECTION 2.15. Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be registered in
the name of the Depository or the nominee of such Depository, (ii) be delivered
to the Trustee as custodian for such Depository and (iii) bear legends as set
forth in Exhibit C hereto.
Members of, or participants in, the Depository
("Participants") shall have no rights under this Indenture with respect to any
Global Security held on their behalf by the Depository, or the Trustee as its
custodian, or under such Global Security, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and Participants, the operation of
customary practices governing the exercise of the rights of a beneficial owner
of any Security.
(b) Transfers of Global Securities shall be limited to
transfers in whole, but not in part, to the Depository, its successors or their
respective nominees. Interests of beneficial owners in the Global Securities may
be transferred or exchanged for Physical Securities in accordance with the rules
and procedures of the Depository and the provisions of Section 2.16. In
addition, Physical Securities shall be transferred to all beneficial owners in
exchange for their beneficial interests in Global Securities if (i) the
Depository notifies the Company that it is unwilling or unable to continue as
Depository for any Global Security and a successor Depository is not appointed
by the Company within 90 days of such notice or (ii) an Event of Default has
occurred and is continuing and the Registrar has received a request from the
Depository to issue Physical Securities.
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(c) In connection with the transfer of Global Securities as an
entirety to beneficial owners pursuant to paragraph (b) of this Section 2.15,
the Global Securities shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall upon written
instructions from the Company authenticate and make available for delivery, to
each beneficial owner identified by the Depository in exchange for its
beneficial interest in the Global Securities, an equal aggregate principal
amount of Physical Securities of authorized denominations.
(d) Any Physical Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to paragraph
(b) of this Section 2.15 shall, except as otherwise provided by Section 2.16,
bear the Private Placement Legend.
(e) The Holder of any Global Security may grant proxies and
otherwise authorize any Person, including Participants and Persons that may hold
interests through Participants, to take any action which a Holder is entitled to
take under this Indenture or the Securities.
SECTION 2.16. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Physical Securities. When
Physical Securities are presented to the Registrar or co-Registrar with a
request:
(i) to register the transfer of the Physical Securities; or
(ii) to exchange such Physical Securities for an equal
principal amount of Physical Securities of other authorized
denominations,
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if the requirements under this Indenture as set forth in this
Section 2.16 for such transactions are met; provided, however, that the Physical
Securities presented or surrendered for registration of transfer or exchange:
(I) shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing; and
(II) in the case of Physical Securities of Series A Securities,
such Physical Securities shall be accompanied, in the sole discretion
of the Company, by the following additional information and documents,
as applicable:
(A) if such Physical Security is being delivered to the
Registrar or co-Registrar by a Holder for
registration in the name of such Holder, without
transfer, a certification from such Holder to that
effect (substantially in the form of Exhibit D
hereto); or
(B) if such Physical Security is being transferred to a
Qualified Institutional Buyer in accordance with Rule
144A, a certification to that effect (substantially
in the form of Exhibit D hereto); or
(C) if such Physical Security is being transferred to an
Institutional Accredited Investor, delivery of a
certification to that effect (substantially in the
form of Exhibit D hereto) and a transferee
certificate for Institutional Accredited Investors
substantially
32
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in the form of Exhibit E hereto and an Opinion of
Counsel reasonably satisfactory to the Company to the
effect that such transfer is in compliance with the
Securities Act; or
(D) if such Physical Security is being transferred in
reliance on Regulation S, delivery of a certification
to that effect (substantially in the form of Exhibit
D hereto) and a transferor certificate for Regulation
S transfers substantially in the form of Exhibit F
hereto and an Opinion of Counsel reasonably
satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act; or
(E) if such Physical Security is being transferred in
reliance on Rule 144 under the Securities Act,
delivery of a certification to that effect
(substantially in the form of Exhibit D hereto) and
an Opinion of Counsel reasonably satisfactory to the
Company to the effect that such transfer is in
compliance with the Securities Act; or
(F) if such Physical Security is being transferred in
reliance on another exemption from the registration
requirements of the Securities Act, a certification
to that effect (substantially in the form of Exhibit
D hereto) and an Opinion of Counsel reasonably
acceptable to the Company to the effect that such
transfer is in compliance with the Securities Act.
(b) Restrictions on Transfer of a Physical Security for a
Beneficial Interest in a Global Security. A Physical Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
or co-Registrar of a Physical Security, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the Registrar or
co-Registrar, together with:
(A) in the case of Series A Securities, certification,
substantially in the form of Exhibit D hereto, that
such Physical Security is being transferred (I) to a
Qualified Institutional Buyer, (II) to an
Institutional Accredited Investor or (III) in an
offshore transaction in reliance on Regulation S and,
with respect to (II) or (III), an Opinion of Counsel
reasonably acceptable to the Company to the effect
that such transfer is in compliance with the
Securities Act; and
(B) written instructions directing the Registrar or
co-Registrar to make, or to direct the Depository to
make, an endorsement on the applicable Global
Security to reflect an increase in the aggregate
amount of the Securities represented by the Global
Security,
then the Registrar or co-Registrar shall cancel such Physical Security and
cause, or direct the Depository to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Registrar or
co-Registrar, the principal amount of Securities represented by the applicable
Global Security to be increased accordingly. If no Global Security representing
Securities held by Qualified Institutional Buyers, Institutional Accredited
Investors or Persons acquiring Securities in offshore transactions in reliance
on Regulation S, as the case may be, is then outstanding, the Company shall
issue and the Trustee shall, upon written instructions from the Company in
accordance with Section 2.02, authenticate such a Global Security in the
appropriate principal amount.
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(c) Transfer and Exchange of Global Securities. The transfer
and exchange of Global Securities or beneficial interests therein shall be
effected through the Depository in accordance with this Indenture (including the
restrictions on transfer set forth herein) and the procedures of the Depository
therefor. Upon receipt by the Registrar or Co-Registrar of written instructions,
or such other instruction as is customary for the Depository, from the
Depository or its nominee, requesting the registration of transfer of an
interest in a QIB Global Security, an Accredited Investor Global Security or
Regulation S Global Security, as the case may be, to another type of Global
Security, together with the applicable Global Securities (or, if the applicable
type of Global Security required to represent the interest as requested to be
transferred is not then outstanding, only the Global Security representing the
interest being transferred), the Registrar or Co-Registrar shall cancel such
Global Securities (or Global Security) and the Company shall issue and the
Trustee shall, upon written instructions from the Company in accordance with
Section 2.02, authenticate new Global Securities of the types so cancelled (or
the type so cancelled and applicable type required to represent the interest as
requested to be transferred) reflecting the applicable increase and decrease of
the principal amount of Securities represented by such types of Global
Securities, giving effect to such transfer. If the applicable type of Global
Security required to represent the interest as requested to be transferred is
not outstanding at the time of such request, the Company shall issue and the
Trustee shall, upon written instructions from the Company in accordance with
Section 2.02, authenticate a new Global Security of such type in principal
amount equal to the principal amount of the interest requested to be
transferred.
(d) Transfer of a Beneficial Interest in a Global Security
for a Physical Security.
(i) Any Person having a beneficial interest in a Global
Security may upon request exchange such beneficial interest for a
Physical Security. Upon receipt by the Registrar or co-Registrar of
written instructions, or such other form of instructions as is
customary for the Depository, from the Depository or its nominee on
behalf of any Person having a beneficial interest in a Global Security
and upon receipt by the Trustee of a written order or such other form
of instructions as is customary for the Depository or the Person
designated by the Depository as having such a beneficial interest
containing registration instructions and, in the case of any such
transfer or exchange of a beneficial interest in Series A Securities,
the following additional information and documents:
(A) if such beneficial interest is being transferred to
the Person designated by the Depository as being the
beneficial owner, a certification from such Person to
that effect (substantially in the form of Exhibit D
hereto); or
(B) if such beneficial interest is being transferred to a
Qualified Institutional Buyer in accordance with Rule
l44A, a certification to that effect (substantially
in the form of Exhibit D hereto); or
(C) if such beneficial interest is being transferred to
an Institutional Accredited Investor, delivery of a
certification to that effect (substantially in the
form of Exhibit D hereto) and a transferee
certificate for Institutional Accredited Investors
substantially in the form of Exhibit E hereto and an
Opinion of Counsel reasonably satisfactory to the
Company to the effect that such transfer is in
compliance with the Securities Act; or
(D) if such beneficial interest is being transferred in
reliance on Regulation S, delivery of a certification
to that effect (substantially in the form of Exhibit
D hereto) and a transferor certificate for Regulation
S transfers substantially in the form of Exhibit F
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hereto and an Opinion of Counsel reasonably
satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act; or
(E) if such beneficial interest is being transferred in
reliance on Rule 144 under the Securities Act,
delivery of a certification to that effect
(substantially in the form of Exhibit D hereto) and
an Opinion of Counsel reasonably satisfactory to the
Company to the effect that such transfer is in
compliance with the Securities Act; or
(F) if such beneficial interest is being transferred in
reliance on another exemption from the registration
requirements of the Securities Act, a certification
to that effect (substantially in the form of Exhibit
D hereto) and an Opinion of Counsel reasonably
satisfactory to the Company to the effect that such
transfer is in compliance with the Securities Act,
then the Registrar or co-Registrar will cause, in accordance with the
standing instructions and procedures existing between the Depository
and the Registrar or co-Registrar, the aggregate principal amount of
the applicable Global Security to be reduced and, following such
reduction, the Company will execute and, upon receipt of an
authentication order in the form of an Officers' Certificate in
accordance with Section 2.02, the Trustee will authenticate and make
available for delivery to the transferee a Physical Security in the
appropriate principal amount.
(ii) Securities issued in exchange for a beneficial interest in
a Global Security pursuant to this Section 2.16(d) shall be registered
in such names and in such authorized denominations as the Depository,
pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Registrar or co-Registrar in writing. The
Registrar or co-Registrar shall deliver such Physical Securities to the
Persons in whose names such Physical Securities are so registered.
(e) Restrictions on Transfer and Exchange of Global
Securities. Notwithstanding any other provisions of this Indenture, a Global
Security may not be transferred as a whole except by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar or co-Registrar shall deliver Securities that do not bear the Private
Placement Legend. Upon the transfer, exchange or replacement of Securities
bearing the Private Placement Legend, the Registrar or co-Registrar shall
deliver only Securities that bear the Private Placement Legend unless, and the
Trustee is hereby authorized to deliver Securities without the Private Placement
Legend if, (i) there is delivered to the Trustee an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act or (ii)
such Security has been sold pursuant to an effective registration statement
under the Securities Act (including pursuant to a Registration).
(g) General. By its acceptance of any Security bearing the
Private Placement Legend, each Holder of such a Security acknowledges the
restrictions on transfer of such Security set forth in this Indenture and in the
Private Placement Legend and agrees that it will transfer such Security only as
provided in this Indenture.
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The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among Participants
or beneficial owners of interest in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.15 or this Section
2.16. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant to
paragraph 5 of the Securities at the applicable redemption price set forth
thereon, it shall notify the Trustee in writing of the Redemption Date and the
principal amount of Securities to be redeemed. The Company shall give such
notice to the Trustee at least 45 days before the Redemption Date (unless a
shorter notice shall be agreed to by the Trustee in writing), together with an
Officers' Certificate stating that such redemption will comply with the
conditions contained herein.
SECTION 3.02. Selection of Securities to Be Redeemed.
If less than all of the Securities are to be redeemed pursuant
to paragraph 5(a) or (b) of the Securities, the Trustee shall select the
Securities to be redeemed in compliance with the requirements of the national
securities exchange, if any, on which the Securities are listed or, if the
Securities are not then listed on a national securities exchange, on a pro rata
basis, by lot or in such other manner as the Trustee shall deem fair and
appropriate. The Trustee shall make the selection from the Securities then
outstanding, subject to redemption and not previously called for redemption.
The Trustee may select for redemption pursuant to paragraph
5(a) or (b) of the Securities portions of the principal amount of Securities
that have denominations equal to or larger than $1,000 principal amount.
Securities and portions of them the Trustee so selects shall be in amounts of
$1,000 principal amount or integral multiples thereof. Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption
Date, the Company shall mail a notice of redemption by first-class mail to each
Holder whose Securities are to be redeemed at such Holder's registered address;
provided, however, that notice of a redemption pursuant to paragraph 5(b) of the
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Securities shall be mailed to each Holder whose Securities are to be redeemed no
later than 60 days following the consummation of the last Public Equity Offering
or Strategic Equity Investment resulting in gross cash proceeds to the Company,
when aggregated with all prior Public Equity Offerings and Strategic Equity
Investments, of at least $75.0 million.
Each notice of redemption shall identify the Securities to be
redeemed (including the CUSIP number thereon) and shall state:
(1) the Redemption Date;
(2) the redemption price;
(3) the name and address of the Paying Agent to which the
Securities are to be surrendered for redemption;
(4) that Securities called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(5) that, unless the Company defaults in making the
redemption payment, interest on Securities called for redemption
ceases to accrue on and after the Redemption Date and the only
remaining right of the Holders is to receive payment of the redemption
price upon surrender to the Paying Agent; and
(6) if any Security is being redeemed in part, the
portion of the principal amount of such Security to be redeemed and
that, after the Redemption Date, upon surrender of such Security, a new
Security or Securities in principal amount equal to the unredeemed
portion thereof will be issued.
At the Company's request, the Trustee shall give the notice of
redemption on behalf of the Company, in the Company's name and at the Company's
expense.
SECTION 3.04. Effect of Notice of Redemption.
Once a notice of redemption is mailed, Securities called for
redemption become due and payable on the Redemption Date and at the redemption
price. Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price, plus accrued interest thereon, if any, to the Redemption Date,
but interest installments whose maturity is on or prior to such Redemption Date
shall be payable to the Holders of record at the close of business on the
relevant Interest Record Date.
SECTION 3.05. Deposit of Redemption Price.
Prior to 10:00 a.m. New York City time on the Redemption Date,
the Company shall deposit with the Paying Agent (or if the Company is its own
Paying Agent, shall, on or before the Redemption Date, segregate and hold in
trust) money sufficient to pay the redemption price of and accrued interest, if
any, on all Securities to be redeemed on that date other than Securities or
portions thereof called for redemption on that date which have been delivered by
the Company to the Trustee for cancellation.
If any Security surrendered for redemption in the manner
provided in the Securities shall not be so paid on the Redemption Date due to
the failure of the Company to deposit with the Paying Agent money
37
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sufficient to pay the redemption price thereof, the principal and accrued and
unpaid interest, if any, thereon shall, until paid or duly provided for, bear
interest as provided in Sections 2.12 and 4.01 with respect to any payment
default.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the
Trustee shall authenticate for the Holder a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on the
Securities in the manner provided in the Securities and the Registration Rights
Agreement. An installment of principal or interest shall be considered paid on
the date due if the Trustee or Paying Agent (other than the Company, a
Subsidiary or an Affiliate of the Company) holds on that date money designated
for and sufficient to pay the installment in full and is not prohibited from
paying such money to the Holders of the Securities pursuant to the terms of this
Indenture.
The Company shall pay cash interest on overdue principal at
the same rate per annum borne by the Securities. The Company shall pay cash
interest on overdue installments of interest at the same rate per annum borne by
the Securities, to the extent lawful, as provided in Section 2.12.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The
City of New York, and, so long as the Securities are listed on the Luxembourg
Stock Exchange and the rules of such stock exchange require, in Luxembourg the
office or agency required under Section 2.03. The Company shall give prompt
written notice to the Trustee of the location, and any change in the location,
of such office or agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the address of the Trustee set forth in Section 10.02 hereof. The
Company hereby initially designates (i) the Trustee at its address set forth in
Section 10.02 hereof as its office or agency in The Borough of Manhattan, The
City of New York, for such purposes and (ii) Banque Internationale a Luxembourg
S.A., at 00, xxxxx x'Xxxx, X-0000 Xxxxxxxxxx, as its office or agency in
Luxembourg for such purposes.
SECTION 4.03. Corporate Existence.
Subject to Article Five, the Company shall do or shall cause
to be done all things necessary to preserve and keep in full force and effect
its corporate existence and the corporate, partnership or other existence of
each Restricted Subsidiary in accordance with the respective organizational
documents of each such Restricted Subsidiary and the rights (charter and
statutory) and material franchises of the Company and the Restricted
Subsidiaries; provided, however, that the Company shall not be required to
preserve any such right or franchise, or the corporate existence of any
Restricted Subsidiary, 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 the Restricted Subsidiaries, taken as a whole, and
that the loss thereof is not, and will not be, adverse in any material respect
to the Holders; provided, further, however, that a determination of the Board of
Directors of the
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Company shall not be required in the event of a merger of one or more Wholly
Owned Restricted Subsidiaries of the Company with or into another Wholly Owned
Restricted Subsidiary of the Company or another Person, if the surviving Person
is a Wholly Owned Restricted Subsidiary of the Company organized under the laws
of the United States or a State thereof or of the District of Columbia.
SECTION 4.04. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all material taxes,
assessments and governmental charges levied or imposed upon the Company or any
Restricted Subsidiary or upon the income, profits or property of the Company or
any Restricted Subsidiary and (2) all lawful claims for labor, materials and
supplies which, in each case, if unpaid, might by law become a material
liability, or Lien upon the property, of the Company or any Restricted
Subsidiary; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings and for which appropriate provision has been made.
SECTION 4.05. Notice of Defaults.
(a) In the event that any Indebtedness of the Company or any
of its Subsidiaries is declared due and payable before its maturity because of
the occurrence of any default (or any event which, with notice or lapse of time,
or both, would constitute such a default) under such Indebtedness, the Company
shall promptly give written notice to the Trustee of such declaration, the
status of such default or event and what action the Company is taking or
proposes to take with respect thereto.
(b) Upon becoming aware of any Default, the Company shall
promptly deliver an Officers' Certificate to the Trustee specifying the Default.
SECTION 4.06. Maintenance of Properties and Insurance.
(a) The Company shall cause all material properties owned by
or leased to it or any Restricted Subsidiary and used or useful in the conduct
of its business or the business of any Restricted Subsidiary to be maintained
and kept in normal condition, repair and working order and supplied with all
necessary equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section 4.06 shall prevent the Company or any
Restricted Subsidiary from discontinuing the use, operation or maintenance of
any of such properties, or disposing of any of them, if such discontinuance or
disposal is, in the judgment of the Board of Directors or of the board of
directors of the Restricted Subsidiary concerned, or of an officer (or other
agent employed by the Company or of any Restricted Subsidiary) of the Company or
such Restricted Subsidiary having managerial responsibility for any such
property, desirable in the conduct of the business of the Company or any
Restricted Subsidiary, and if such discontinuance or disposal is not adverse in
any material respect to the Holders.
(b) The Company shall maintain, and shall cause the Restricted
Subsidiaries to maintain, insurance with responsible carriers against such risks
and in such amounts, and with such deductibles, retentions,
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self-insured amounts and co-insurance provisions, as are customarily carried by
similar businesses of similar size, including property and casualty loss, and
workers' compensation insurance.
SECTION 4.07. Compliance Certificate.
The Company shall deliver to the Trustee within 120 days after
the close of each fiscal year a certificate signed by the principal executive
officer, principal financial officer or principal accounting officer stating
that a review of the activities of the Company has been made under the
supervision of the signing officers with a view to determining whether a Default
has occurred and whether or not the signers know of any Default by the Company
that occurred during such fiscal year. If they do know of such a Default, the
certificate shall describe all such Defaults, their status and the action the
Company is taking or proposes to take with respect thereto. The first
certificate to be delivered by the Company pursuant to this Section 4.07 shall
be for the fiscal year ending December 31, 1997.
SECTION 4.08. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law, which would prohibit or forgive the Company from
paying all or any portion of the principal of and/or interest, if any, on the
Securities as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of this
Indenture; and (to the extent that it may lawfully do so) the Company hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 4.09. Provision of Financial Information.
Whether or not the Company is subject to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, the Company shall
file with the SEC (if permitted by SEC practice and applicable law and
regulations) the annual reports, quarterly reports and other documents which the
Company would have been required to file with the SEC pursuant to such Section
13(a) or 15(d) or any successor provision thereto if the Company were so
required, such documents to be filed with the SEC on or prior to the respective
dates (the "Required Filing Dates") by which the Company would have been
required so to file such documents if the Company were so required; provided,
however, that until the Company is subject to Section 13(a) or Section 15(d) of
the Exchange Act or any successor provisions thereto, the Required Filing Dates
for such quarterly reports shall be 75 days following the end of the applicable
fiscal quarter. The Company shall also in any event (a) within 15 days of each
Required Filing Date (whether or not permitted or required to be filed with the
SEC but subject to the proviso in the previous sentence) (i) transmit (or cause
to be transmitted) by mail to all Holders, as their names and addresses appear
in the Note register, without cost to such Holders, and (ii) file with the
Trustee, copies of the annual reports, quarterly reports and other documents
which the Company is required to file with the SEC pursuant to the preceding
sentence, or, if such filing is not so permitted, information and data of a
similar nature, and (b) if, notwithstanding the preceding sentence, filing such
documents by the Company with the SEC is not permitted by SEC practice or
applicable law or regulations, promptly upon written request supply copies of
such documents to any Holder. In addition, for so long as any Securities remain
outstanding, the Company will furnish to the Holders and to securities analysts
and prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act, and, to any
beneficial holder of Securities, if not obtainable from the SEC, information of
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the type that would be filed with the SEC pursuant to the foregoing provisions,
upon the request of any such holder.
SECTION 4.10. Change of Control.
(a) Following the occurrence of a Change of Control (the date
of such occurrence being the "Change of Control Date"), the Company shall notify
the Trustee and Holders of the Securities of such occurrence in the manner
prescribed by this Indenture and shall, within 30 days after the Change of
Control Date, make an Offer to Purchase all Securities then outstanding at a
purchase price in cash equal to 101% of the aggregate principal amount thereof,
plus accrued and unpaid interest thereon, if any, to the Purchase Date. The
Company will cause a copy of such notice to be published in a daily newspaper
with general circulation in Luxembourg (which is expected to be the Luxembourg
Wort). The Company's obligations may be satisfied if a third party makes the
Offer to Purchase in the manner, at the times and otherwise in compliance with
the requirements of this Indenture applicable to an Offer to Purchase made by
the Company and purchases all Securities validly tendered and not withdrawn
under such Offer to Purchase. Each Holder shall be entitled to tender all or any
portion of the Securities owned by such Holder pursuant to the Offer to
Purchase, subject to the requirement that any portion of a Security tendered
must be tendered in an integral multiple of $1,000 principal amount.
(b) On or prior to the Purchase Date specified in the Offer to
Purchase, the Company shall (i) accept for payment all Securities or portions
thereof validly tendered pursuant to the Offer, (ii) deposit with the Paying
Agent or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 2.04) money sufficient to pay the Purchase Price
of all Securities or portions thereof so accepted and (iii) deliver or cause to
be delivered to the Trustee for cancellation all Securities so accepted together
with an Officers' Certificate stating the Securities or portions thereof
accepted for payment by the Company. The Paying Agent (or the Company, if so
acting) shall promptly mail or deliver to Holders of Securities so accepted,
payment in an amount equal to the Purchase Price for such Securities, and the
Trustee shall promptly authenticate and mail or deliver to each Holder of
Securities a new Security or Securities equal in principal amount to any
unpurchased portion of the Security surrendered as requested by the Holder. Any
Security not accepted for payment shall be promptly mailed or delivered by the
Company to the Holder thereof. The Company shall publicly announce the results
of the Offer on or as soon as practicable after the Purchase Date.
(c) If the Company makes an Offer to Purchase, the Company
will comply with all applicable tender offer laws and regulations, including, to
the extent applicable, Section 14(e) and Rule 14e-1 under the Exchange Act, and
any other applicable Federal or state securities laws and regulations and any
applicable requirements of any securities exchange on which the Securities are
listed, and any violation of the provisions of this Indenture relating to such
Offer to Purchase occurring as a result of such compliance shall not be deemed a
Default.
SECTION 4.11. Limitation on Restricted Payments.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly,
(i) declare or pay any dividend or any other distribution on
any Equity Interests of the Company or any Restricted Subsidiary or
make any payment or distribution to the direct or indirect holders of
Equity Interests of the Company or any Restricted Subsidiary (other
than any dividends, distributions and payments made to the Company or
any Restricted Subsidiary and dividends or distri-
41
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butions payable to any Person solely in Qualified Equity Interests or
in options, warrants or other rights to purchase Qualified Equity
Interests);
(ii) purchase, redeem or otherwise acquire or retire for value
any Equity Interests of the Company or any Restricted Subsidiary (other
than any such Equity Interests owned by the Company or any Restricted
Subsidiary);
(iii) purchase, redeem, defease or retire for value, or make
any principal payment on, prior to any scheduled maturity, scheduled
repayment or scheduled sinking fund payment, any Subordinated
Indebtedness (other than any Subordinated Indebtedness held by any
Restricted Subsidiary); or
(iv) make any Investment (other than Permitted Investments)
(any of the foregoing, a "Restricted Payment"), unless
(a) no Default shall have occurred and be continuing at the
time of or after giving effect to such Restricted Payment;
(b) immediately after giving effect to such Restricted
Payment, the Company would be able to Incur $1.00 of additional
Indebtedness under Section 4.12(a); and
(c) immediately after giving effect to such Restricted
Payment, the aggregate amount of all Restricted Payments (including the
Fair Market Value of any non-cash Restricted Payment) declared or made
on or after the Issue Date (excluding any Restricted Payment described
in clauses (ii), (iii) or (iv) of the next paragraph) does not exceed
an amount equal to the sum of the following (the "Basket"):
(1) (x) the Cumulative Operating Cash Flow determined
at the time of such Restricted Payment less (y) 150% of
cumulative Consolidated Interest Expense determined for the
period (treated as one accounting period) commencing on the
Issue Date and ending on the last day of the most recent
fiscal quarter immediately preceding the date of such
Restricted Payment for which consolidated financial
information of the Company is required to be available, plus
(2) the aggregate net cash proceeds received by the
Company either (x) as capital contributions to the Company
after the Issue Date or (y) from the issue and sale (other
than to a Subsidiary) of Qualified Equity Interests after the
Issue Date (other than any issuance and sale of Qualified
Equity Interests financed, directly or indirectly, using funds
(I) borrowed from the Company or any Subsidiary until and to
the extent such borrowing is repaid or (II) contributed,
extended, guaranteed or advanced by the Company or any
Subsidiary (including, without limitation, in respect of any
employee stock ownership or benefit plan)), plus
(3) the aggregate amount by which Indebtedness (other
than any Subordinated Indebtedness) of the Company or any
Restricted Subsidiary is reduced on the Company's balance
sheet upon the conversion or exchange (other than by a
Subsidiary of the Company) subsequent to the Issue Date into
Qualified Equity Interests (less the amount of any cash, or
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the fair value of property, distributed by the Company or any
Restricted Subsidiary upon such conversion or exchange), plus
(4) in the case of the disposition or repayment of any
Investment that was treated as a Restricted Payment made after
the Issue Date, an amount (to the extent not included in the
computation of Cumulative Operating Cash Flow) equal to the
lesser of: (x) the return of capital with respect to such
Investment and (y) the amount of such Investment that was
treated as a Restricted Payment, in either case, less the cost
of the disposition of such Investment and net of taxes, plus
(5) so long as the Designation thereof was treated as
a Restricted Payment made after the Issue Date, with respect
to any Unrestricted Subsidiary that has been redesignated as a
Restricted Subsidiary after the Issue Date in accordance with
Section 4.14, the Company's proportionate interest in an
amount equal to the excess of (x) the total assets of such
Subsidiary, valued on an aggregate basis at the lesser of book
value and Fair Market Value, over (y) the total liabilities of
such Subsidiary, determined in accordance with GAAP (and
provided that such amount shall not in any case exceed the
Designation Amount with respect to such Restricted Subsidiary
upon its Designation), minus
(6) with respect to each Subsidiary of the Company
which has been designated as an Unrestricted Subsidiary after
the Issue Date in accordance with Section 4.14, the greater of
(x) $0 and (y) the Designation Amount thereof (measured as of
the Date of Designation).
Notwithstanding the foregoing, the GTS Contribution shall not
be taken into account in calculating the Basket.
The foregoing provisions will not prevent (i) the payment of
any dividend or distribution on, or redemption of, Equity Interests within 60
days after the date of declaration of such dividend or distribution or the
giving of formal notice of such redemption, if at the date of such declaration
or giving of formal notice such payment or redemption would comply with the
provisions of the Indenture; (ii) the purchase, redemption, retirement or other
acquisition of any Equity Interests of the Company in exchange for, or out of
the net cash proceeds of the substantially concurrent (A) common equity capital
contribution to the Company from any Person (other than a Subsidiary) or (B)
issue and sale (other than to a Subsidiary) of, Qualified Equity Interests;
(iii) any Investment to the extent that the consideration therefor consists of
the net proceeds of the substantially concurrent issue and sale (other than to a
Subsidiary) of Qualified Equity Interests; (iv) the purchase, redemption,
retirement, defeasance or other acquisition of Subordinated Indebtedness made in
exchange for, or out of the net cash proceeds of, a substantially concurrent
issue and sale (other than to a Subsidiary) of, (x) Qualified Equity Interests
or (y) other Subordinated Indebtedness having no stated maturity for the payment
of principal thereof prior to the Maturity Date; or (v) any Investment in any
Person principally engaged in a Telecommunications Business; provided, however,
that Investments pursuant to this clause (v) shall not exceed $25.0 million in
the aggregate at any time outstanding; provided, further, however, that in the
case of each of clauses (ii), (iii), (iv) and (v), no Default shall have
occurred and be continuing or would arise therefrom.
SECTION 4.12. Limitation on Incurrence of Indebtedness.
(a) The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, Incur any Indebtedness;
provided, however, that the Company may Incur Indebtedness if,
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at the time of such Incurrence, the Debt to Annualized Operating Cash Flow Ratio
would be less than or equal to 6.0 to 1.0.
(b) The foregoing limitations of paragraph (a) of this
covenant will not apply to any of the following, each of which shall be given
independent effect:
(i) the Securities, and Permitted Refinancings thereof;
(ii) Indebtedness of the Company or any Restricted Subsidiary
to the extent outstanding on the date of the Indenture, and Permitted
Refinancings thereof;
(iii) Indebtedness of the Company or Qualified Subsidiary
Indebtedness, in each case, to the extent that the proceeds of or
credit support provided by such Indebtedness is used to finance the
cost (including the cost of design, development, construction,
installation or integration) of network assets, equipment or inventory
acquired by the Company or a Restricted Subsidiary after the Issue
Date, and Permitted Refinancings thereof;
(iv) (1) Indebtedness of the Company or Qualified Subsidiary
Indebtedness, in each case, to the extent that the proceeds of or
credit support provided by such Indebtedness is used to finance a
Telecommunications Acquisition, or working capital for, or to finance
the construction of, the business or network acquired and (2) Acquired
Indebtedness, and, in each case, Permitted Refinancings thereof, but in
each case only to the extent that (x) the aggregate amount of
Indebtedness outstanding of the Company and the Restricted Subsidiaries
after giving effect to the Incurrence of such Indebtedness and the
application of the proceeds therefrom does not exceed the product of
2.0 and the Share Capital of the Company at the date of Incurrence of
such Indebtedness or (y) the aggregate amount of such Indebtedness or
Acquired Indebtedness, together with all Indebtedness of the Person, if
any, that is to become a Restricted Subsidiary or be merged or
consolidated with or into the Company or any Restricted Subsidiary in
the contemplated transaction outstanding at the time of such
transaction (whether or not Incurred in connection with, or in
contemplation of, such transaction), does not exceed the net sum of the
plant, property and equipment set forth on the Latest Balance Sheet of
such Person;
(v) (1) Indebtedness of any Restricted Subsidiary owed to and
held by the Company or any Restricted Subsidiary and (2) Indebtedness
of the Company owed to and held by any Restricted Subsidiary which is
unsecured and subordinated in right of payment to the payment and
performance of the Company's obligations under the Securities;
provided, however, that an Incurrence of Indebtedness that is not
permitted by this clause (v) shall be deemed to have occurred upon (x)
any sale or other disposition of any Indebtedness of the Company or any
Restricted Subsidiary referred to in this clause (v) to any Person
other than the Company or any Restricted Subsidiary or (y) any
Restricted Subsidiary that holds Indebtedness of the Company or another
Restricted Subsidiary ceasing to be a Restricted Subsidiary;
(vi) Interest Rate Protection Obligations of the Company or
any Restricted Subsidiary relating to Indebtedness of the Company or
such Restricted Subsidiary, as the case may be (which Indebtedness (x)
bears interest at fluctuating interest rates and (y) is otherwise
permitted to be Incurred under this covenant); provided, however, that
the notional principal amount of such Interest Rate Protection
Obligations does not exceed the principal amount of the Indebtedness to
which such Interest Rate Protection Obligations relate;
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(vii) Indebtedness of the Company or any Restricted Subsidiary
under Currency Agreements to the extent relating to (x) Indebtedness of
the Company or such Restricted Subsidiary, as the case may be, and/or
(y) obligations to purchase assets, properties or services incurred in
the ordinary course of business of the Company or such Restricted
Subsidiary, as the case may be; provided, however, that such Currency
Agreements do not increase the Indebtedness or other obligations of the
Company and the Restricted Subsidiaries outstanding other than as a
result of fluctuations in foreign currency exchange rates or by reason
of fees, indemnities or compensation payable thereunder;
(viii) Indebtedness of the Company and/or any Restricted
Subsidiary in respect of performance bonds of the Company or any
Restricted Subsidiary or surety bonds provided by the Company or any
Restricted Subsidiary incurred in the ordinary course of business and
on ordinary business terms in connection with the construction or
operation of a Telecommunications Business; and
(ix) in addition to the items referred to in clauses (i) through
(viii) above, Indebtedness of the Company or Qualified Subsidiary
Indebtedness in an aggregate amount not to exceed $15.0 million at any
time outstanding.
(c) For purposes of determining any particular amount of
Indebtedness under this covenant, guarantees, Liens or obligations with respect
to letters of credit supporting Indebtedness otherwise included in the
determination of such particular amount shall not be included; provided,
however, that the foregoing shall not in any way be deemed to limit the
provisions of Section 4.18.
(d) For purposes of determining compliance with this covenant,
in the event that an item of Indebtedness may be Incurred through the first
paragraph of this covenant or by meeting the criteria of one or more of the
types of Indebtedness described in the second paragraph of this covenant (or the
definitions of the terms used therein), the Company, in its sole discretion may,
at the time of such Incurrence, (i) classify such item of Indebtedness under and
comply with either of such paragraphs (or any of such definitions), as
applicable, (ii) classify and divide such item of Indebtedness into more than
one of such paragraphs (or definitions), as applicable, and (iii) elect to
comply with such paragraphs (or definitions), as applicable, in any order.
SECTION 4.13. Limitations on Restrictions Affecting Restricted Subsidiaries.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary 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 (x) pay dividends or make any other
distributions to the Company or any other Restricted Subsidiary on its Equity
Interests or with respect to any other interest or participation in, or measured
by, its profits, or pay any Indebtedness owed to the Company or any other
Restricted Subsidiary, (y) make loans or advances to, or guarantee any
Indebtedness or other obligations of, the Company or any other Restricted
Subsidiary or (z) transfer any of its properties or assets to the Company or any
other Restricted Subsidiary.
The foregoing shall not prohibit (a) any encumbrance or
restriction existing under or by reason of any agreement in effect on the Issue
Date, as any such agreement is in effect on such date or as thereafter amended
or supplemented but only if such encumbrance or restriction is no more
restrictive than in the agreement being amended; (b) customary provisions
contained in an agreement that has been entered into for the sale or disposition
of all or substantially all of the Capital Stock or assets of a Restricted
Subsidiary; provided, however, that (x) such encumbrance or restriction is
applicable only to such Restricted Subsidiary or assets and (y) such sale or
disposition is made in accordance with Section 4.16; (c) any encumbrance or re-
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striction existing under or by reason of applicable law; (d) customary
provisions restricting subletting or assignment of any lease governing any
leasehold interest of any Restricted Subsidiary; (e) covenants in purchase money
obligations for property acquired in the ordinary course of business restricting
transfer of such property; (f) covenants in security agreements securing
Indebtedness of a Restricted Subsidiary (to the extent that such Liens were
otherwise incurred in accordance with Section 4.15) that restrict the transfer
of property subject to such agreements; (g) any agreement or other instrument of
a Person acquired by the Company or any Restricted Subsidiary in existence at
the time of such acquisition, which encumbrance or restriction (x) is not
applicable to any Person, or the properties or assets of any Person, other than
the Person, or the properties or assets of the Person so acquired, and (y) is
not incurred in connection with or in contemplation of such acquisition; or (h)
contained in any agreement entered into after the Issue Date, so long as such
encumbrance or restriction is not materially more disadvantageous to the Holders
than the encumbrances and restrictions in existence at the Issue Date.
SECTION 4.14. Designation of Unrestricted Subsidiaries.
(a) The Company may designate any Subsidiary of the Company as
an "Unrestricted Subsidiary" under this Indenture (a "Designation") only if:
(i) no Default shall have occurred and be continuing at the
time of or after giving effect to such Designation;
(ii) at the time of and after giving effect to such
Designation, the Company could Incur $1.00 of additional Indebtedness
under Section 4.12(a); and
(iii) the Company would be permitted to make an Investment
(other than a Permitted Investment) at the time of Designation
(assuming the effectiveness of such Designation) pursuant to the first
paragraph of Section 4.11 in an amount (the "Designation Amount") equal
to the Fair Market Value of the Company's proportionate interest in the
net worth of such Subsidiary on such date calculated in accordance with
GAAP.
All Subsidiaries of Unrestricted Subsidiaries shall be
Unrestricted Subsidiaries.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, at any time (x) provide credit
support for, subject any of its properties or assets (other than the Equity
Interests of any Unrestricted Subsidiary) to the satisfaction of, or guarantee,
any Indebtedness of any Unrestricted Subsidiary (including any undertaking,
agreement or instrument evidencing such Indebtedness), (y) be liable for any
Indebtedness of any Unrestricted Subsidiary or (z) be liable for any
Indebtedness which provides that the holder thereof may (upon notice, lapse of
time or both) declare a default thereon or cause the payment thereof to be
accelerated or payable prior to its final scheduled maturity upon the occurrence
of a default with respect to any Indebtedness of any Unrestricted Subsidiary.
(b) The Company may revoke any Designation of a Subsidiary as
an Unrestricted Subsidiary (a "Revocation") only if:
(i) no Default shall have occurred and be continuing at the
time of and after giving effect to such Revocation;
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(ii) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if Incurred at
such time, have been permitted to be Incurred for all purposes of the
Indenture; and
(iii) any transaction (or series of related transactions) between
such Subsidiary and any of its Affiliates that occurred while such
Subsidiary was an Unrestricted Subsidiary would be permitted by Section
4.17 as if such transaction (or series of related transactions) had
occurred at the time of such Revocation (after giving effect to any
modification to such transaction (or series of related transactions)
effective at such time).
All Designations and Revocations must be evidenced by
resolutions of the Board of Directors of the Company, delivered to the Trustee
certifying compliance with the foregoing provisions.
SECTION 4.15. Limitation on Liens.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, Incur any Lien (other than any
Permitted Lien) of any kind against or upon any of their respective properties
or assets now owned or hereafter acquired, or any proceeds, income or profits
therefrom, unless contemporaneously therewith or prior thereto, (i) in the case
of any Lien securing an obligation that ranks pari passu with the Securities,
effective provision is made to secure the Securities equally and ratably with or
prior to such obligation with a Lien on the same collateral and (ii) in the case
of any Lien securing an obligation that is subordinated in right of payment to
the Securities, effective provision is made to secure the Securities with a Lien
on the same collateral that is prior to the Lien securing such subordinated
obligation, in each case, for so long as such obligation is secured by such
Lien.
SECTION 4.16. Limitation on Asset Sales.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, make any Asset Sale, unless
(x) the Company or such Restricted Subsidiary, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the Fair Market
Value of the assets sold or otherwise disposed of and (y) at least 75% of such
consideration consists of (i) cash or Cash Equivalents, (ii) Replacement Assets,
(iii) publicly traded Equity Interests of a Person who is engaged primarily in a
Telecommunications Business; provided, however, that the Company or such
Restricted Subsidiary shall sell (a "Monetization Sale"), for cash or Cash
Equivalents, such Equity Interests to a third Person (other than to the Company
or a Subsidiary thereof) at a price not less than the Fair Market Value thereof
within 365 days of the consummation of such Asset Sale, or (iv) any combination
of the foregoing clauses (i) through (iii). The amount of any (x) Indebtedness
(other than any Subordinated Indebtedness) of the Company or any Restricted
Subsidiary that is actually assumed by the transferee in such Asset Sale and
from which the Company and the Restricted Subsidiaries are fully released shall
be deemed to be cash for purposes of determining the percentage of cash
consideration received by the Company or such Restricted Subsidiary and (y)
notes or other similar obligations received by the Company or any Restricted
Subsidiary from such transferee that are immediately converted, sold or
exchanged (or are converted, sold or exchanged within 365 days of the related
Asset Sale) by the Company or any Restricted Subsidiary into cash shall be
deemed to be cash, in an amount equal to the net cash proceeds realized upon
such conversion, sale or exchange for purposes of determining the percentage of
cash consideration received by the Company or such Restricted Subsidiary. Any
Net Cash Proceeds from any Asset Sale or any Monetization Sale that are not
invested in Replacement Assets or used to repay and permanently reduce the
commitments under Indebtedness of any Restricted Subsidiary within 365 days of
the
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consummation of such Asset Sale or Monetization Sale shall constitute "Excess
Proceeds" subject to disposition as provided below.
Within 40 days after the aggregate amount of Excess Proceeds
equals or exceeds $10.0 million, the Company shall make an Offer to Purchase,
from all Holders, that aggregate principal amount of Securities as can be
purchased with the Note Portion of Excess Proceeds at a price in cash equal to
100% of the principal amount thereof, plus accrued and unpaid interest, if any,
to any purchase date. To the extent that the aggregate amount of principal and
accrued interest of Securities validly tendered and not withdrawn pursuant to an
Offer to Purchase is less than the Excess Proceeds, the Company may use such
surplus for general corporate purposes. If the aggregate amount of principal and
accrued interest of Securities validly tendered and not withdrawn by Holders
thereof exceeds the amount of Securities that can be purchased with the Note
Portion of Excess Proceeds, Securities to be purchased will be selected pro rata
based on the aggregate principal amount of Securities tendered by each Holder.
Upon completion of an Offer to Purchase, the amount of Excess Proceeds with
respect to the applicable Asset Sale or Monetization Sale shall be reset to
zero.
In the event that any other Indebtedness of the Company that
ranks pari passu with the Securities (the "Other Debt") requires an offer to
purchase to be made to repurchase such Other Debt upon the consummation of an
Asset Sale, the Company may apply the Excess Proceeds otherwise required to be
applied to an Offer to Purchase to offer to purchase such Other Debt and to an
Offer to Purchase so long as the amount of such Excess Proceeds applied to
purchase the Securities is not less than the Note Portion of Excess Proceeds.
With respect to any Excess Proceeds, the Company shall make the Offer to
Purchase in respect thereof at the same time as the analogous offer to purchase
is made pursuant to any Other Debt and the Purchase Date in respect thereof
shall be the same as the purchase date in respect thereof pursuant to any Other
Debt.
For purposes of this covenant, "Note Portion of Excess
Proceeds" means (1) if no Other Debt is being offered to be purchased, the
amount of the Excess Proceeds and (2) if Other Debt is being offered to be
purchased, the amount of the Excess Proceeds equal to the product of (x) the
Excess Proceeds and (y) a fraction the numerator of which is the aggregate
amount of all Securities tendered pursuant to the Offer to Purchase related to
such Excess Proceeds (the "Note Amount") and the denominator of which is the sum
of the Note Amount and the aggregate amount as of the relevant purchase date of
all Other Debt tendered and purchased pursuant to a concurrent offer to purchase
such Other Debt made at the time of such Offer to Purchase.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act, and any violation of the provisions of the
Indenture relating to such Offer to Purchase occurring as a result of such
compliance shall not be deemed a Default or an Event of Default.
SECTION 4.17. Limitation on Transactions with Affiliates.
The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, conduct any business or enter
into any transaction or series of related transactions with or for the benefit
of any Affiliate, any holder of 5% or more of any class of Equity Interests or
any officer, director or employee of the Company or any Restricted Subsidiary
(each, an "Affiliate Transaction"), unless such Affiliate Transaction is on
terms that are no less favorable to the Company or such Restricted Subsidiary,
as the case may be, than could reasonably be obtained at such time in a
comparable transaction with an unaffiliated third party. For any such
transaction that involves value in excess of $5.0 million, the Company shall
deliver to the
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Trustee an Officers' Certificate stating that a majority of the Disinterested
Directors has determined that the transaction satisfies the above criteria and
shall evidence such a determination by a Board Resolution delivered to the
Trustee. For any such transaction that involves value in excess of $12.5
million, the Company shall also obtain a written opinion from an Independent
Financial Advisor to the effect that such transaction is fair, from a financial
point of view, to the Company or such Restricted Subsidiary, as the case may be.
Notwithstanding the foregoing, the restrictions set forth in
this covenant shall not apply to (i) transactions between or among the Company
and one or more Restricted Subsidiaries or between or among Restricted
Subsidiaries; (ii) customary directors' fees, indemnification and similar
arrangements, employee salaries, bonuses or employment agreements, compensation
or employee benefit arrangements and incentive arrangements with any officer,
director or employee of the Company or any Restricted Subsidiary entered into in
the ordinary course of business (including customary benefits thereunder); (iii)
transactions pursuant to agreements in effect on the Issue Date, as such
agreements are in effect on the Issue Date or as thereafter amended or
supplemented in a manner not adverse to the Holders; (iv) loans and advances to
officers, directors and employees of the Company or any Restricted Subsidiary
for travel, entertainment, moving and other relocation expenses, in each case
made in the ordinary course of business and consistent with past business
practices; (v) any transactions between the Company or any Restricted
Subsidiary, on the one hand, and any Affiliate of the Company engaged primarily
in a Telecommunications Business, on the other hand, (x) in the ordinary course
of business and consistent with commercially reasonable practices or (y)
approved by a majority of the Disinterested Directors; (vi) any payment pursuant
to any tax sharing agreement between the Company and any other Person with which
the Company files a consolidated tax return or with which the Company is part of
a consolidated group for tax purposes; provided that such payment is not greater
than that which the Company would be required to pay as a stand-alone taxpayer;
(vii) the pledge of Equity Interests of Unrestricted Subsidiaries to support the
Indebtedness thereof; and (viii) payment of dividends in respect of Equity
Interests of the Company or any Restricted Subsidiary permitted under Section
4.11.
SECTION 4.18. Limitation on Issuances of Guarantees by Restricted Subsidiaries.
The Company shall not cause or permit any Restricted
Subsidiary, directly or indirectly, to guarantee any Indebtedness of the Company
("Guaranteed Indebtedness"), unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture to the Indenture
pursuant to which such Restricted Subsidiary guarantees (a "Subsidiary
Guarantee") all of the Company's obligations under the Securities and the
Indenture and (ii) such Restricted Subsidiary waives and will not in any manner
whatsoever claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary as a result of any payment by such Restricted
Subsidiary under its Subsidiary Guarantee. If the Guaranteed Indebtedness is (A)
pari passu with the Securities, then the guarantee of such Guaranteed
Indebtedness shall be pari passu with, or subordinated to, the Subsidiary
Guarantee or (B) subordinated to the Securities, then the guarantee of such
Guaranteed Indebtedness shall be subordinated to the Subsidiary Guarantee at
least to the extent that the Guaranteed Indebtedness is subordinated to the
Securities.
Any Subsidiary Guarantee by a Restricted Subsidiary shall
provide by its terms that it shall be automatically and unconditionally released
and discharged upon (i) any sale, exchange or transfer, to any Person not an
Affiliate of the Company, of all of the Equity Interests of the Company or any
Restricted Subsidiary in, or all or substantially all the assets of, such
Restricted Subsidiary (which sale, exchange or transfer is made in accordance
with this Indenture) or (ii) the release or discharge of the guarantee which
resulted in the creation of such Subsidiary Guarantee, except a discharge or
release by or as a result of payment under such guarantee.
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SECTION 4.19. Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries.
The Company shall not sell, and shall not cause or permit any
Restricted Subsidiary, directly or indirectly, to issue or sell, any Equity
Interests of a Restricted Subsidiary, except (i) to the Company or a Wholly
Owned Restricted Subsidiary; (ii) if, immediately after giving effect to such
issuance or sale, such Restricted Subsidiary would no longer constitute a
Restricted Subsidiary; or (iii) in the case of issuance of Equity Interests by a
non-Wholly Owned Restricted Subsidiary if, after giving effect to such issuance,
the Company maintains its direct or indirect percentage of beneficial and
economic ownership of such non-Wholly Owned Restricted Subsidiary.
SECTION 4.20. Additional Amounts.
(a) All payments made by the Company under or with respect to
the Securities will be made free and clear of and without withholding or
deduction for or on account of any present of future Taxes imposed or levied by
or on behalf of any Taxing Authority within the Netherlands, or within any other
jurisdiction in which the Company is organized or engaged in business for tax
purposes, unless the Company is required to withhold or deduct Taxes by law or
by the interpretation or administration thereof. If the Company is required to
withhold or deduct any amount for or on account of Taxes imposed by a Taxing
Authority within the Netherlands, or within any other jurisdiction in which the
Company is organized or engaged in business for tax purposes, from any payment
made under or with respect to the Securities, the Company will pay such
additional amounts ("Additional Amounts") as may be necessary so that the net
amount received by each holder of Securities (including Additional Amounts)
after such withholding or deduction will equal the amount the holder would have
received if such Taxes had not been withheld or deducted; provided, however,
that no Additional Amounts will be payable with respect to any Tax that would
not have been imposed, payable or due (i) but for the existence of any present
or former connection between the holder (or the beneficial owner of, or person
ultimately entitled to obtain an interest in, such Securities) and the
Netherlands or other jurisdiction in which the Company is organized or engaged
in business for tax purposes other than the mere holding of the Securities; (ii)
but for the failure to satisfy any certification, identification or other
reporting requirements whether imposed by statute, treaty, regulation or
administrative practice, provided that the Company has delivered a request to
the holder to comply with such requirements at least 30 days prior to the date
by which such compliance is required; (iii) if the presentation of Securities
(where presentation is required) for payment has occurred within 30 days after
the date such payment was due and payable or was duly provided for, whichever is
later; or (iv) if the beneficial owner of, or person ultimately entitled to
obtain an interest in, such Securities had been the holder of the Securities and
would not be entitled to the payment of Additional Amounts (excluding the impact
of the book-entry procedures described in Section 2.15). In addition, Additional
Amounts will not be payable with respect to any Tax which is payable otherwise
than by withholding from payments of, or in respect of principal of, or any
interest on, the Securities.
SECTION 4.21. Deposit of Funds with Escrow Agent.
(a) On the Issue Date, the Company shall deposit with the
Escrow Agent funds that together with the proceeds from the investment thereof
will be sufficient to pay the first four scheduled interest payments on the
Securities (excluding any Additional Amounts or Additional Interest). All
Collateral shall be held in the Escrow Account until permitted to be disbursed
pursuant to the Escrow Agreement and then shall be disbursed strictly in
accordance with the terms thereof.
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(b) Pending release of the Escrow Funds as provided in the
Escrow Agreement, the Escrow Funds will be invested in Cash Equivalents as
specifically directed in writing by the Company. Any interest or other profit
resulting from such investment will be deposited in the Escrow Account.
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Sale of Assets, etc.
The Company shall not consolidate with or merge with or into
(whether or not the Company is the Surviving Person) any other Person and the
Company shall not, and shall not cause or permit any Restricted Subsidiary to,
sell, convey, assign, transfer, lease or otherwise dispose of all or
substantially all of the property and assets of the Company and the Restricted
Subsidiaries, taken as a whole, to any Person or Persons (other than any
Restricted Subsidiary), in each case, in a single transaction or series of
related transactions, unless: (i) either (x) the Company shall be the Surviving
Person or (y) the Surviving Person (if other than the Company) shall be a
corporation organized and validly existing under the laws of The Netherlands,
the United States of America or any State thereof or the District of Columbia,
and shall, in any such case, expressly assume by a supplemental indenture, the
due and punctual payment of the principal of and interest on the Securities and
the performance and observance of every covenant of this Indenture, the Escrow
Agreement and the Registration Rights Agreement to be performed or observed on
the part of the Company; (ii) immediately after giving effect to such
transaction, no Default shall have occurred and be continuing; and (iii)
immediately after giving effect to such transaction, the Surviving Person (as
the Company) could Incur at least $1.00 of additional Indebtedness under Section
4.12(a).
For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all the properties and assets of one or
more Restricted Subsidiaries the Equity Interests of which constitutes all or
substantially all the properties and assets of the Company shall be deemed to be
the transfer of all or substantially all the properties and assets of the
Company.
SECTION 5.02. Successor Corporation Substituted.
In the event of any transaction (other than a lease) described
in and complying with the conditions listed in the first paragraph of this
covenant in which the Company is not the Surviving Person and the Surviving
Person is to assume all the Obligations of the Company under the Securities,
this Indenture, the Escrow Agreement and the Registration Rights Agreement
pursuant to a supplemental indenture, such Surviving Person shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
and the Company shall be discharged from its Obligations under the Securities,
this Indenture, the Escrow Agreement and the Registration Rights Agreement.
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ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following shall be an "Event of Default" for
purposes of this Indenture:
(1) failure to pay principal of any Security when due;
(2) failure to pay any interest on any Security when due,
continued for 30 days or more;
(3) failure to pay on the Purchase Date the Purchase Price for
any Security validly tendered pursuant to an Offer to Purchase;
(4) failure to perform or comply with any of the provisions of
Section 5.01;
(5) failure to perform any other covenant, warranty or
agreement of the Company under this Indenture or the Escrow Agreement
or in the Securities, and the Default continues for the period and
after the notice specified in the last paragraph of this Section 6.01;
(6) there shall be, with respect to any issue or issues of
Indebtedness of the Company or any Restricted Subsidiary having an
outstanding principal amount of $10.0 million or more in aggregate for
such issues of all such Persons, whether such Indebtedness now exists
or shall hereafter be created, (x) an event of default that has caused
the holders thereof (or their representative) (I) to declare such
Indebtedness to be due and payable prior to its scheduled maturity and
such Indebtedness has not been discharged in full or such acceleration
has not been rescinded or annulled within 45 days following such
acceleration and/or (II) to commence judicial proceeding to foreclose
upon, or to exercise remedies under applicable law or applicable
security documents to take ownership of, the property or assets
securing such Indebtedness and/or (y) the failure to make a principal
payment at the final (but not any interim) fixed maturity and such
defaulted payment shall not have been made, waived or extended within
45 days of such payment default;
(7) there shall have been any final judgment or judgments
against the Company or any Restricted Subsidiary in an amount of $10.0
million or more which remain undischarged or unstayed for a period of
60 consecutive days;
(8) the Company or any Significant Restricted Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) admits in writing its inability to pay its debts
generally as they become due,
(B) commences a voluntary case or proceeding,
(C) consents to the entry of an order for relief
against it in an involuntary case or proceeding,
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(D) consents or acquiesces in the institution of a
bankruptcy or insolvency proceeding against it,
(E) consents to the appointment of a Custodian of it
or for all or substantially all of its property, or
(F) makes a general assignment for the benefit of its
creditors, or any of them takes any action to authorize or
effect any of the foregoing;
(9) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Restricted Subsidiary in an involuntary case or
proceeding,
(B) appoints a Custodian of the Company or any
Significant Restricted Subsidiary or for all or substantially
all of its property, or
(C) orders the liquidation of the Company or any
Significant Restricted Subsidiary, and in each case the order
or decree remains unstayed and in effect for 60 days;
provided, however, that if the entry of such order or decree
is appealed and dismissed on appeal, then the Event of Default
hereunder by reason of the entry of such order or decree shall
be deemed to have been cured; or
(10) the Company challenges the Lien on the Collateral under
the Escrow Agreement prior to such time as the Collateral is to be
released to the Company, or the Collateral becomes subject to any Lien
other than the Lien under the Escrow Agreement.
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal, state or foreign law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, sequestrator or
similar official under any Bankruptcy Law.
A Default under clause (5) is not an Event of Default until
the Trustee notifies the Company, or the Holders of at least 25% in aggregate
principal amount of the outstanding Securities notify the Company and the
Trustee, of the Default in writing and the Company does not cure the Default
within 30 days after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default."
Such notice shall be given by the Trustee if so requested by the Holders of at
least 25% in principal amount of the Securities then outstanding. When a Default
is cured, it ceases.
SECTION 6.02. Acceleration.
If an Event of Default with respect to the Securities (other
than an Event of Default specified in clause (8) or (9) of Section 6.01 with
respect to the Company) occurs and is continuing, the Trustee or the Holders of
at least 25% in aggregate principal amount of the outstanding Securities by
notice in writing to the Company may declare the unpaid principal of and accrued
interest to the date of acceleration on all outstanding Securities to be due and
payable immediately and, upon any such declaration, such principal amount and
accrued interest, notwithstanding anything contained in this Indenture or the
Securities to the contrary, shall become immediately due and payable.
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If an Event of Default specified in clause (8) or (9) of
Section 6.01 with respect to the Company occurs, all unpaid principal of and
accrued interest on all outstanding Securities shall ipso facto become
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
After a declaration of acceleration, but before a judgment or
decree of the money due in respect of the Securities has been obtained, the
Holders of not less than a majority in aggregate principal amount of the
Securities then outstanding by written notice to the Trustee may rescind an
acceleration and its consequences if all existing Events of Default (other than
the nonpayment of principal of and interest on the Securities which has become
due solely by virtue of such acceleration) have been cured or waived and if the
rescission would not conflict with any judgment or decree. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities, this Indenture or the Escrow
Agreement.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy maturing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
Upon a declaration of acceleration of the Securities in
accordance with Section 6.02, the Trustee shall foreclose on all Collateral and
take all other actions permitted of a secured party under the UCC or otherwise.
SECTION 6.04. Waiver of Past Default.
Subject to Sections 2.09, 6.07 and 9.02, prior to the
declaration of acceleration of the Securities, the Holders of not less than a
majority in aggregate principal amount of the outstanding Securities by written
notice to the Trustee may waive an existing Default and its consequences, except
a Default in the payment of principal of or interest on any Security as
specified in Section 6.01(1) or (2) or a Default in respect of any term or
provision of this Indenture that may not be amended or modified without the
consent of each Holder affected as provided in Section 9.02. The Company shall
deliver to the Trustee an Officers' Certificate stating that the requisite
percentage of Holders have consented to such waiver and attaching copies of such
consents. In case of any such waiver, the Company, the Trustee and the Holders
shall be restored to their former positions and rights hereunder and under the
Securities, respectively. This paragraph of this Section 6.04 shall be in lieu
of Section 316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA is
hereby expressly excluded from this Indenture and the Securities, as permitted
by the TIA.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured and not to have occurred
for every purpose of this Indenture and the Securities, but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
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SECTION 6.05. Control by Majority.
Subject to Section 2.09, the Holders of a majority in
principal amount of the outstanding Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it. However, the Trustee may refuse
to follow any direction that conflicts with law, this Indenture or the Escrow
Agreement, that the Trustee determines may be unduly prejudicial to the rights
of another Securityholder, or that may involve the Trustee in personal
liability; provided, however, that the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction. In the
event the Trustee takes any action or follows any direction pursuant to this
Indenture, the Trustee shall be entitled to indemnification satisfactory to it
in its sole discretion against any loss or expense caused by taking such action
or following such direction. This Section 6.05 shall be in lieu of Section
316(a)(1)(A) of the TIA, and such Section 316(a)(1)(A) of the TIA is hereby
expressly excluded from this Indenture and the Securities, as permitted by the
TIA.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to
this Indenture or the Securities
unless:
(i) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount
of the outstanding Securities make a written request to the Trustee to
pursue a remedy;
(iii) such Holder or Holders offer and, if requested, provide
to the Trustee indemnity reasonably satisfactory to the Trustee against
any loss, liability or expense;
(iv) the Trustee does not comply with the request within 60
days after receipt of the request; and
(v) during such 60-day period the Holders of a majority in
principal amount of the outstanding Securities (excluding Affiliates of
the Company) do not give the Trustee a direction which, in the opinion
of the Trustee, is inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over such
other Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of or interest on a
Security, on or after the respective due dates therefor, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust
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against the Company or any other obligor on the Securities for the whole amount
of principal and accrued interest remaining unpaid, together with interest
overdue on principal and to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate per annum
borne by the Securities 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 may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relative to the Company (or
any other obligor upon the Securities), its creditors or its property and shall
be entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same, and any
Custodian in any such judicial proceedings is hereby authorized by each
Securityholder 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
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this
Article Six or the Escrow Agreement, it shall pay out the money or property in
the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for principal and interest, respectively; and
Third: to the Company.
The Trustee, upon prior written notice to the Company, may fix
a record date and payment date for any payment to Securityholders pursuant to
this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court 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 and expenses, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.11 shall not apply to a suit by the Trustee,
a suit by a Holder or group of Holders of more than 10% in aggregate principal
amount of the outstanding Securities, or to any suit instituted by any Holder
for the
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enforcement or the payment of the principal or interest on any Securities on or
after the respective due dates therefor.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.
(b) Except during the continuance of a Default:
(1) The Trustee shall not be liable except for the performance
of such duties as are specifically set forth herein; 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 conforming to the requirements of this Indenture or the Escrow
Agreement; however, in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall examine such certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture or the Escrow Agreement.
(c) The Trustee shall not be relieved from liability 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 shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) No provision of this Indenture or the Escrow Agreement
shall require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or to take
or omit to take any action under this Indenture or take any action at the
request or direction of Holders if it shall have reasonable grounds for
believing that repayment of such funds is not assured to it or it does not
receive from such Holders an indemnity or security satisfactory to it in its
sole discretion against such risk, liability, loss, fee or expense which might
be incurred by it in compliance with such request or direction.
(e) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section
7.01.
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(f) The Trustee shall not be liable for interest on any money
received by it. 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.
Subject to Section 7.01:
(a) The Trustee may rely on 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 and/or an Opinion of Counsel, which shall
conform to the provisions of Section 10.05. The Trustee shall not be liable for
any action it takes or omits to take in good faith in reliance on such
certificate or opinion.
(c) The Trustee may act through attorneys and agents of its
selection and shall not be responsible for the misconduct or negligence of any
agent or attorney (other than an agent who is an employee of the Trustee)
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it reasonably believes to be authorized or
within its rights or powers.
(e) The Trustee may consult with counsel of its selection and
the advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any action
taken, omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
(f) Any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution.
(g) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture or the Escrow Agreement
at the request or direction of any of the Securityholders pursuant to this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction.
(h) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney.
(i) The Trustee shall not be deemed to have notice of any
Event of Default unless a Trust Officer of the Trustee has actual knowledge
thereof or unless the Trustee shall have received written notice thereof at the
Corporate Trust Office of the Trustee, and such notice references the Securities
and this Indenture.
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SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
its Affiliates with the same rights it would have if it were not Trustee,
subject to Section 7.10 hereof. Any Agent may do the same with like rights.
However, the Trustee is subject to Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, the Escrow
Agreement or the Securities, it shall not be accountable for the Company's use
of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in this Indenture or any document issued in connection
with the sale of Securities or any statement in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults.
If a Default occurs and is continuing and the Trustee actually
knows of such Default, the Trustee shall mail to each Securityholder notice of
the Default within 30 days after the occurrence thereof. Except in the case of a
Default in payment of principal of or interest on any Security or a Default in
complying with any of the provisions of the Escrow Agreement, the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interest of
Securityholders. This Section 7.05 shall be in lieu of the proviso to Section
315(b) of the TIA and such proviso to Section 315(b) of the TIA is hereby
expressly excluded from this Indenture and the Securities, as permitted by the
TIA.
SECTION 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after each
September 1 beginning with September 1, 1998, the Trustee shall mail to each
Securityholder a report dated as of such September 1 that complies with TIA
Section 313(a). The Trustee also shall comply with TIA Section 313(b), (c) and
(d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange, if any, on
which the Securities are listed.
The Company shall promptly notify the Trustee in writing if
the Securities become listed on any stock exchange or of any delisting thereof.
SECTION 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation as the Company and the Trustee shall from time to time agree in
writing for its services. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances (including fees, disbursements and expenses of its agents and
counsel) incurred or made by it in addition to the compensation for its services
except any such disbursements, expenses and advances as may be attributable to
the Trustee's negligence or bad faith. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trus-
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tee's agents, accountants, experts and counsel and any taxes or other expenses
incurred by a trust created pursuant to Section 8.01 hereof.
The Company shall indemnify the Trustee, its agents and
officers, for, and hold it harmless against any and all loss, damage, claims,
liability or expense, including taxes (other than franchise taxes imposed on the
Trustee and taxes based upon, measured by or determined by the income of the
Trustee), arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent that
such loss, damage, claim, liability or expense is due to its own negligence or
bad faith. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. However, the failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee shall
cooperate in the defense (and may employ its own counsel) at the Company's
expense; provided, however, that the Company's reimbursement obligation with
respect to counsel employed by the Trustee will be limited to the reasonable
fees and expenses of such counsel.
The Company need not pay for any settlement made without its
written consent, which consent shall not be unreasonably withheld. The Company
need not reimburse any expense or indemnify against any loss or liability
incurred by the Trustee as a result of the violation of this Indenture by the
Trustee.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a Lien prior to the Securities against all money or
property held or collected by the Trustee, in its capacity as Trustee, except
money or property held in trust to pay principal of or interest on particular
Securities or the Purchase Price or redemption price of any Securities to be
purchased or pursuant to an Offer to Purchase or redeemed.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(8) or (9) occurs, the expenses
(including the reasonable fees and expenses of its agents and counsel) and the
compensation for the services shall be preferred over the status of the Holders
in a proceeding under any Bankruptcy Law and are intended to constitute expenses
of administration under any Bankruptcy Law. The Company's obligations under this
Section 7.07 and any claim arising hereunder shall survive the resignation or
removal of any Trustee, the discharge of the Company's obligations pursuant to
Article Eight and any rejection or termination under any Bankruptcy Law, and the
termination of this Indenture.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Trustee and the Company in
writing and may appoint a successor Trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent under
any Bankruptcy Law;
(3) a custodian or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
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If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the Securities may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee pursuant to Section 7.07, all property held
by it as Trustee to the successor Trustee, subject to the Lien provided in
Section 7.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have the rights, powers and duties of
the Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of at least 10% in principal amount of the outstanding
Securities may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 shall continue for
the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking corporation, the resulting, surviving or transferee
corporation or banking corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee which shall be
eligible to act as Trustee under TIA Sections 310(a)(1) and 310(a)(2). The
Trustee shall have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition. If the Trustee
has or shall acquire any "conflicting interest" within the meaning of TIA
Section 310(b), the Trustee and the Company shall comply with the provisions of
TIA Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 7.10, the Trustee
shall resign immediately in the manner and with the effect hereinbefore
specified in this Article Seven.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein.
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ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations.
The Company may terminate its substantive obligations in
respect of the Securities by delivering all outstanding Securities to the
Trustee for cancellation and paying all sums payable by it on account of
principal of and interest on all Securities or otherwise. In addition to the
foregoing, the Company may terminate its obligation under Sections 4.04, 4.06,
4.08, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19 and 4.20 (and
no Default with respect to such Sections under Section 6.01(5) shall thereafter
apply), by (i) depositing with the Trustee, under the terms of an irrevocable
trust agreement, money or U. S. Government Obligations sufficient (without
reinvestment) to pay all remaining indebtedness on the Securities at maturity or
an earlier redemption, (ii) delivering to the Trustee either an Opinion of
Counsel or a ruling directed to the Trustee from the Internal Revenue Service to
the effect that the Holders of the Securities will not recognize income, gain or
loss for federal income tax purposes as a result of such deposit and termination
of obligations, (iii) delivering to the Trustee an Opinion of Counsel to the
effect that the Company's exercise of its option under this paragraph will not
result in any of the Company, the Trustee or the trust created by the Company's
deposit of funds pursuant to this provision becoming or being deemed to be an
"investment company" under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and (iv) delivering to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating compliance with all
conditions precedent provided for herein. In addition, the Company may, provided
that no Default has occurred and is continuing or would arise therefrom (or,
with respect to a Default specified in Section 6.01(8) or (9), occurs at any
time on or prior to the 91st calendar day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until after
such 91st day)), terminate all of its substantive obligations in respect of the
Securities (including its obligations to pay the principal of and interest on
the Securities) by (i) depositing with the Trustee, under the terms of an
irrevocable trust agreement, money or U.S. Government Obligations sufficient
(without reinvestment) to pay all remaining indebtedness on the Securities at
maturity or upon earlier redemption, (ii) delivering to the Trustee either a
ruling directed to the Trustee from the Internal Revenue Service to the effect
that the Holders of the Securities will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and termination of
obligations or an Opinion of Counsel addressed to the Trustee based upon such a
ruling or based on a change in the applicable Federal tax law since the date of
this Indenture to such effect, (iii) delivering to the Trustee an Opinion of
Counsel to the effect that the Company's exercise of its option under this
paragraph will not result in any of the Company, the Trustee or the trust
created by the Company's deposit of funds pursuant to this provision becoming or
being deemed to be an "investment company" under the Investment Company Act and
(iv) delivering to the Trustee an Officers' Certificate and an Opinion of
Counsel each stating compliance with all conditions precedent provided for
herein.
Notwithstanding the foregoing paragraph, the Company's
obligations under Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.10, 2.12, 2.13
and 4.01 (but not with respect to termination of substantive obligations
pursuant to the third sentence of the foregoing paragraph), 4.02, 7.07, 7.08,
8.03 and 8.04 shall survive until the Securities are no longer outstanding.
Thereafter the Company's obligations in Sections 7.07, 8.03 and 8.04 shall
survive.
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After such delivery or irrevocable deposit and delivery of an
Officers' Certificate and Opinion of Counsel, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Securities and this Indenture except for those surviving obligations specified
above.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U. S. Government
Obligations deposited pursuant to this Section 8.01 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of outstanding Securities.
SECTION 8.02. Application of Trust Money.
The Trustee shall hold in trust money or U. S. Government
Obligations deposited with it pursuant to Section 8.01, and shall apply the
deposited money and the money from United States Government Obligations in
accordance with this Indenture solely to the payment of principal of and
interest on the Securities.
SECTION 8.03. Repayment to Company.
Subject to Sections 7.07 and 8.01, the Trustee shall promptly
pay to the Company upon written request any excess money held by it at any time.
The Trustee shall pay to the Company upon written request any money held by it
for the payment of principal or interest that remains unclaimed for two years;
provided, however, that the Trustee before being required to make any payment
may at the expense of the Company cause to be published once in a newspaper of
general circulation in The City of New York and in a newspaper of general
circulation in Luxembourg or mail to each Holder entitled to such money notice
that such money remains unclaimed and that, after a date specified therein which
shall be at least 30 days from the date of such publication or mailing, any
unclaimed balance of such money then remaining shall be repaid to the Company.
After payment to the Company, Securityholders entitled to money must look to the
Company for payment as general creditors unless an applicable abandoned property
law designates another person and all liability of the Trustee or Paying Agent
with respect to such money shall thereupon cease.
SECTION 8.04. Reinstatement.
If the Trustee is unable to apply any money or U.S. Government
Obligations in accordance with Section 8.01 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
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.01 until such
time as the Trustee is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 8.01; provided, however, that if the
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Company, when authorized by a resolution of its Board of
Directors, and the Trustee may amend or supplement this Indenture or the
Securities without notice to or consent of any Securityholder:
(i) to cure any ambiguity, defect or inconsistency; provided,
however, that such amendment or supplement does not materially
adversely affect the rights of any Holder;
(ii) to effect the assumption by a successor Person of all
obligations of the Company under the Securities, this Indenture, the
Registration Rights Agreement and the Escrow Agreement in connection
with any transaction complying with Article Five of this Indenture;
(iii) to provide for uncertificated Securities in addition to
or in place of certificated Securities;
(iv) to comply with any requirements of the SEC in order to
effect or maintain the qualification of this Indenture under the TIA;
(v) to make any change that would provide any additional
benefit or rights to the Holders;
(vi) to make any other change that does not materially
adversely affect the rights of any Holder under this Indenture;
(vii) to add to the covenants of the Company for the benefit
of the Holders, or to surrender any right or power herein conferred
upon the Company; or
(viii) to secure the Securities pursuant to the requirements
of Section 4.20 or otherwise;
provided, however, that the Company has delivered to the Trustee an Opinion of
Counsel stating that such amendment or supplement complies with the provisions
of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Company, when authorized by a
resolution of its Board of Directors, and the Trustee may amend or supplement
this Indenture or the Securities with the written consent of the Holders of a
majority in principal amount of the outstanding Securities. Subject to Section
6.07, the Holders of a majority in principal amount of the outstanding
Securities may waive compliance by the Company with any provision of this
Indenture or the Securities. However, without the consent of the Holder of each
Security affected, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:
(1) change the maturity of the principal of any such Security;
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(2) alter the optional redemption or repurchase provisions of
any such Security or this Indenture in a manner adverse to the Holders
of such Security;
(3) reduce the principal amount of any such Security;
(4) reduce the rate of or extend the time for payment of
interest on any such Security;
(5) change the place or currency of payment of the principal
of or interest on any such Security;
(6) modify any provisions of Section 6.04 (other than to add
sections of this Indenture or the Securities subject thereto) or 6.07
or this Section 9.02 (other than to add sections of this Indenture or
the Securities which may not be amended, supplemented or waived without
the consent of each Securityholder affected);
(7) reduce the percentage of the principal amount of
outstanding Securities necessary for amendment to or waiver of
compliance with any provision of this Indenture or the Securities or
for waiver of any Default in respect thereof;
(8) waive a default in the payment of the principal of or
interest on or redemption payment with respect to any such Security
(except a rescission of acceleration of the Securities by the Holders
as provided in Section 6.02 and a waiver of the payment default that
resulted from such acceleration);
(9) modify the ranking or priority of such Security;
(10) modify the provisions of any covenant (or the related
definitions in this Indenture) requiring the Company to make any Offer
to Purchase in a manner materially adverse to the Holders; or
(11) modify the provisions of the Escrow Agreement or this
Indenture relating to the Collateral from the Lien under the Escrow
Agreement or permit any other obligation to be secured by the
Collateral.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
9.02 becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
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SECTION 9.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to
it by a Holder is a continuing consent by the Holder and every subsequent Holder
of that Security or portion of that Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by notice to the Trustee or the Company received before the date on
which the Trustee receives an Officers' Certificate certifying that the Holders
of the requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders of Securities entitled to
consent to any amendment, supplement or waiver. If a record date is fixed, then,
notwithstanding the last sentence of the immediately preceding paragraph, those
persons who were Holders of Securities at such record date (or their duly
designated proxies), and only those persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such persons continue to be Holders of such Securities after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change described in any of
clauses (1) through (11) of Section 9.02. In that case the amendment, supplement
or waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the Security shall issue
and the Trustee shall authenticate a new Security that reflects the changed
terms. Failure to make the appropriate notation or issue a new Security shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. Trustee to Sign Amendments, etc.
The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
any amendment, supplement or waiver authorized pursuant to this Article Nine is
authorized or permitted by this Indenture and that such amendment, supplement or
waiver constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms (subject to customary exceptions). The
Trustee may, but shall not be obligated to, execute any such amendment,
supplement or waiver which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise. In signing any amendment,
supplement or waiver, the Trustee shall be entitled to receive an indemnity
reasonably satisfactory to it.
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ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls.
This Indenture is subject to the provisions of the TIA that
are required to be a part of this Indenture, and shall, to the extent
applicable, be governed by such provisions. If any provision of this Indenture
modifies any TIA provision that may be so modified, such TIA provision shall be
deemed to apply to this Indenture as so modified. If any provision of this
Indenture excludes any TIA provision that may be so excluded, such TIA provision
shall be excluded from this Indenture.
The provisions of TIA Sections 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.
SECTION 10.02. Notices.
Any notice or communication shall be sufficiently given if in
writing and delivered in person, by facsimile and confirmed by overnight
courier, or mailed by first-class mail addressed as follows:
if to the Company:
Hermes Europe Railtel X.X.
Xxxxxxxxxxxxxxxxx 0X
0000 Xxxxxxxxx
Xxxxxxx
Attention: Chief Executive Officer
Facsimile: 00-0-000-0000
Telephone: 00-0-000-0000
with a copy to:
Global TeleSystems Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx 00xx Xxxxx
XxXxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
and
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Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxxxxx, Xx.
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
if to GTS:
Global TeleSystems Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx 00xx Xxxxx
XxXxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Trustee Administration
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
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if to the Luxembourg Paying and Transfer Agent:
Banque Internationale a Luxembourg
00, xxxxx x'Xxxx
X-0000 Xxxxxxxxxx
Facsimile: (000) 0000-0000
Telephone: (000) 0000-0000
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed, first-class, postage
prepaid, to a Holder including any notice delivered in connection with TIA
Section 310(b), TIA Section 313(c), TIA Section 314(a) and TIA Section 315(b),
shall be mailed to him at his address as set forth on the Security Register and
shall be sufficiently given to him if so mailed within the time prescribed. To
the extent required by the TIA, any notice or communication shall also be mailed
to any Person described in TIA Section 313(c).
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. Except for a notice to the Trustee, which is deemed given only
when received, if a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 10.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Trustee, the Registrar and any other person
shall have the protection of TIA Section 312(c).
SECTION 10.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee
to take or refrain from taking any action under this Indenture, the Company
shall furnish to the Trustee at the request of the Trustee:
(1) an Officers' Certificate in form and substance satisfactory
to the Trustee stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance satisfactory to
the Trustee stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate (other than the certificates provided
pursuant to Section 4.07) or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
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(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 has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of such person,
such condition or covenant has been complied with; provided, however,
that with respect to matters of fact an Opinion of Counsel may rely on
an Officers' Certificate or certificates of public officials.
SECTION 10.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a
meeting of Securityholders. The Paying Agent or Registrar may make reasonable
rules for its functions.
SECTION 10.07. Governing Law.
The laws of the State of New York shall govern this Indenture
and the Securities without regard to principles of conflicts of law.
SECTION 10.08. No Recourse Against Others.
A director, officer, employee, incorporator or stockholder of
the Company or any of its Affiliates, as such, shall not have any liability for
any obligations of the Company or any of its Affiliates under the Securities or
this Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Security waives and
releases all such liability.
SECTION 10.09. Successors.
All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 10.10. Counterpart Originals.
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 10.11. Severability.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby, and a Holder shall have no claim therefor against any party
hereto.
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SECTION 10.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan
or debt agreement may not be used to interpret this Indenture.
SECTION 10.13. Legal Holidays.
If a payment date is a not a Business Day at a place of
payment, payment may be made at that place on the next succeeding Business Day,
and no interest shall accrue for the intervening period.
SECTION 10.14. Agent for Service; Submission to Jurisdiction; Waiver of
Immunities.
By the execution and delivery of this Indenture, the Company
(i) acknowledges that it has, by separate written instruments, designated and
appointed CT Corporation System, 0000 Xxxxxxxx, Xxx Xxxx, XX 00000 ("CT
Corporation System") (and any successor entity), as its authorized agent upon
which process may be served in any suit or proceeding arising out of or relating
to this Indenture that may be instituted in any federal or state court in the
Borough of Manhattan, City of New York, State of New York or brought under
federal or state securities laws, and represent and warrant that CT Corporation
System has accepted such designation, (ii) submit to the jurisdiction of any
such court in any such suit or proceeding and (iii) agree that service of
process upon CT Corporation System and written notice of said service to the
Company, in accordance with Section 10.02 shall be deemed in every respect
effective service of process upon the Company in any such suit or proceeding.
The Company further agrees to take any and all action, including the execution
and filing of any and all such documents and instruments, as may be necessary to
continue such designation and appointment of CT Corporation System in full force
and effect for as long as any of the Securities remain outstanding (subject to
the limitation set forth in clause (i)); provided, however, that the Company
may, and to the extent CT Corporation System ceases to be able to be served on
the basis contemplated herein shall, by written notice to the Trustee, designate
such additional or alternative agent for service of process under this Section
10.14 that (i) maintains an office located in the Borough of Manhattan, City of
New York, State of New York, and (ii) is either (x) United States counsel for
the Company or (y) a corporate service company which acts as agent for service
of process for other persons in the ordinary course of its business. Such
written notice shall identify the name of such agent for service of process and
the address of the office of such agent for service of process in the Borough of
Manhattan, City of New York, State of New York.
To the extent that the Company has or hereafter may acquire
any immunity from jurisdiction of any court of (i) any jurisdiction in which the
Company owns or leases property or assets, (ii) the United States or the State
of New York or (iii) the Netherlands or from any legal process (whether through
service of notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) with respect to itself or its property and assets or
this Agreement or any of the Notes or actions to enforce judgments in respect of
any thereof, the Company hereby irrevocably waives such immunity in respect of
its obligations under the above-referenced documents, to the extent permitted by
law.
SECTION 10.15. Judgment Currency.
The Company hereby agrees to indemnify the Trustee, its
directors, its officers and each person, if any, who controls the Trustee within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act against
any loss incurred by such person as a result of any judgment or order being
given or made against the Company for any U.S. dollar amount due under this
Agreement and such judgment or order being
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expressed and paid in a currency (the "Judgment Currency") other than United
States dollars and as a result of any variation as between (i) the rate of
exchange at which the United States dollar amount is converted into the Judgment
Currency for the purpose of such judgment or order and (ii) the spot rate of
exchange in The City of New York at which such party on the date of payment of
such judgment or order is able to purchase United States dollars with the amount
of the Judgment Currency actually received by such party. The foregoing
indemnity shall continue in full force and effect notwithstanding any such
judgment or order as aforesaid. The term "spot rate of exchange" shall include
any premiums and costs of exchange payable in connection with the purchase of,
or conversion into, United States dollars.
ARTICLE ELEVEN
COLLATERAL AND SECURITY
SECTION 11.01. Escrow Agreement.
The due and punctual payment of the first four scheduled
interest payments on the Securities when and as the same shall be due and
payable on an Interest Payment Date or by acceleration shall be secured as
provided in the Escrow Agreement which the Company and the Trustee have entered
into simultaneously with the execution of this Indenture. Upon the acceleration
of the maturity of the Securities, the Trustee shall foreclose upon the
Collateral. Each Holder of Securities, by its acceptance thereof, consents and
agrees to the terms of the Escrow Agreement (including, without limitation, the
provisions providing for foreclosure and disbursement of Collateral) as the same
may be in effect or may be amended from time to time in accordance with its
terms and the terms hereof and authorizes and directs the Escrow Agent and the
Trustee to enter into the Escrow Agreement and to perform its obligations and
exercise its rights thereunder in accordance therewith. The Company shall
deliver to the Trustee copies of the Escrow Agreement, and shall do or cause to
be done all such acts and things as may be necessary or proper, or as may be
required by the provisions of the Escrow Agreement, to assure and confirm to the
Trustee the security interest in the Collateral contemplated by the Escrow
Agreement or any part thereof, as from time to time constituted, so as to render
the same available for the security and benefit of this Indenture with respect
to, and of, the Securities, according to the intent and purposes expressed in
the Escrow Agreement. The Company shall take any and all actions reasonably
required to cause the Escrow Agreement to create and maintain (to the extent
possible under applicable law), as security for the obligations of the Company
hereunder, a first priority and exclusive security interest in and on all the
Collateral, in favor of the Trustee for the benefit of the Holders of
Securities, superior to and prior to the rights of all third Persons and subject
to no other Liens. The Trustee shall have no responsibility for perfecting or
maintaining the perfection of the Trustee's security interest in the Collateral
or for filing any instrument, document or notice in any public office at any
time or times.
SECTION 11.02. Recording and Opinions.
(a) The Company shall furnish to the Trustee simultaneously
with the execution and delivery of this Indenture an Opinion of Counsel either
(i) stating that in the opinion of such counsel all action has been taken with
respect to the recording, registering and filing of this Indenture, financing
statements or other instruments necessary to make effective the security
interest intended to be created by the Escrow Agreement and reciting the details
of such action, or (ii) stating that in the opinion of such counsel no such
action is necessary to make such security interest effective.
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(b) The Company shall furnish to the Trustee on each
anniversary of the Issue Date (upon receipt of written notice from Escrow Agent)
until the date upon which the balance of Escrow Funds shall have been reduced to
zero, an Opinion of Counsel, dated as of such date, either (i) stating that (A)
in the opinion of such counsel, action has been taken with respect to the
recording, registering, filing, re-recording, re-registering and refiling of all
supplemental indentures, financing statements, continuation statements or other
instruments of further assurance as is necessary to maintain the Lien of the
Escrow Agreement and reciting the details of such action or referring to prior
Opinions of Counsel in which such details are given and (B) based on relevant
laws as in effect on the date of such Opinion of Counsel, all financing
statements and continuation statements have been executed and filed that are
necessary as of such date and during the succeeding 12 months fully to preserve
and protect, to the extent such protection and preservation are possible by
filing, the rights of the Holders of Securities and the Trustee hereunder and
under the Escrow Agreement with respect to the security interests in the
Collateral or (ii) stating that, in the opinion of such counsel, no such action
is necessary to maintain such Lien and assignment.
SECTION 11.03. Release of Collateral.
(a) Subject to subsections (b), (c) and (d) of this Section
11.03, the Collateral may be released from the security interest created by the
Escrow Agreement only in accordance with the provisions of the Escrow Agreement.
(b) Except to the extent that any security interest on
proceeds of Collateral is automatically released by operation of Section 9-306
of the Uniform Commercial Code or other similar law, no Collateral shall be
released from the security interest created by the Escrow Agreement pursuant to
the provisions of the Escrow Agreement, other than to the Holders pursuant to
the terms thereof.
(c) At any time when an Event of Default shall have occurred
and be continuing and the maturity of the Securities shall have been accelerated
(whether by declaration or otherwise), no Collateral shall be released pursuant
to the provisions of the Escrow Agreement, and no release of Collateral in
contravention of this Section 11.03(c) shall be effective as against the Holders
of Securities, except for the disbursement of all Escrow Funds (as defined in
the Escrow Agreement) and other Collateral to the Trustee pursuant to Section
6(c) of the Escrow Agreement.
(d) The release of any Collateral from the security interests
created by this Indenture and the Escrow Agreement shall not be deemed to impair
the security under this Indenture in contravention of the provisions hereof if
and to the extent the Collateral is released pursuant to the terms hereof or
pursuant to the terms of the Escrow Agreement. To the extent applicable, the
Company shall cause TIA Section 314(d) relating to the release of property or
securities from the security interest of the Escrow Agreement to be complied
with. Any certificate or opinion required by TIA Section 314(d) may be made by
an Officer of the Company except in cases where TIA Section 314(d) requires that
such certificate or opinion be made by an independent Person, which Person shall
be an independent engineer, appraiser or other expert selected or approved by
the Trustee in the exercise of reasonable care.
SECTION 11.04. Authorization of Actions to Be Taken by the Trustee Under the
Escrow Agreement.
Subject to the provisions of Section 7.01 and Section 7.02,
the Trustee may, without the consent of the Holders of Securities, on behalf of
the Holders of Securities, take all actions it deems necessary or appropriate in
order to (a) enforce any of the terms of the Escrow Agreement and (b) collect
and receive any
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and all amounts payable in respect of the obligations of the Company hereunder.
The Trustee shall have power to institute and maintain such suits and
proceedings as it may deem expedient to prevent any impairment of the Collateral
by any acts that may be unlawful or in violation of the Escrow Agreement or this
Indenture, and such suits and proceedings as the Trustee may deem expedient to
preserve or protect its interests and the interests of the Holders of Securities
in the Collateral (including power to institute and maintain suits or
proceedings to restrain the enforcement of or compliance with any legislative or
other governmental enactment, rule or order that may be unconstitutional or
otherwise invalid if the enforcement of, or compliance with, such enactment,
rule or order would impair the security interest hereunder or be prejudicial to
the interests of the Holders of Securities or of the Trustee).
SECTION 11.05. Authorization of Receipt of Funds by the Trustee Under the Escrow
Agreement.
The Trustee is authorized to receive any funds for the benefit
of the Holders of Securities disbursed under the Escrow Agreement, and to make
further distributions of such funds to the Holders of Securities according to
the provisions of this Indenture.
SECTION 11.06. Termination of Security Interest.
Upon the earliest to occur of (i) the date upon which the
balance of Escrow Funds and other Collateral shall have been reduced to zero,
(ii) the payment of the first four scheduled interest payments on the
Securities, (iii) legal defeasance pursuant to Section 8.01 and (iv) covenant
defeasance pursuant to Section 8.01, the Trustee shall, at the written request
of the Company, release the security interest in the Collateral pursuant to this
Indenture and the Escrow Agreement upon the Company's compliance with the
provisions of the TIA pertaining to release of collateral.
ARTICLE TWELVE
COVENANT OF GLOBAL TELESYSTEMS GROUP, INC.
SECTION 12.01. GTS Contribution.
GTS shall consummate, or shall cause to be consummated, the
GTS Contribution on or prior to September 30, 1997. This obligation of GTS will
constitute "Senior Indebtedness" under that certain indenture noted as of July
14, 1997 between GTS and The Bank of New York relating to GTS' Senior
Subordinated Convertible Bonds due 2000, and will be incurred pursuant to clause
(c) of the second paragraph of the "Limitation of Indebtedness" covenant. If GTS
fails to comply with the foregoing covenant, the Holders and the Company shall
each be entitled to commence proceedings against GTS and to seek to compel
performance and any other remedies available under law.
GTS agrees that this covenant is part of the consideration for
purchase of the Securities.
[Signature Pages Follow]
74
S-1
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
HERMES EUROPE RAILTEL B.V.
By: /s/ XXXXX XXXXXX
-----------------------
Name: Xxxxx Xxxxxx
Title: Attorney-in-fact
GLOBAL TELESYSTEMS GROUP, INC.
(the undersigned agrees to be bound by
this Indenture with respect only to
Article Twelve hereof)
By: /s/ XXXXXXX X. XXXXXXX
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President
of Finance and Chief
Financial Officer
THE BANK OF NEW YORK,
as Trustee
By: /s/ XXXX XXXXXX
------------------------------
Name: Xxxx Xxxxxx
Title: Assistant Vice-President
75
EXHIBIT A
[FORM OF SERIES A SECURITY]
"THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN,
THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"),
(B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE
WITH REGULATION S UNDER THE SECURITIES ACT OR (C) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2),
(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT (AN "IAI") (2)
AGREES THAT IT WILL NOT, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT
(A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF
RULE 904 OF THE SECURITIES ACT, (D) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (E) TO AN IAI THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS NOTE (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 $265,000, AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES
ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE
TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE MEANINGS
GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGIS-
A-1
76
TER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING.
A-2
77
HERMES EUROPE RAILTEL B.V.
11-1/2% Senior Note due 2007
CUSIP No.:
No. $
HERMES EUROPE RAILTEL B.V., a Netherlands limited company (the
"Company", which term includes any successor corporation), for value received
promises to pay to or registered assigns, the principal sum of Dollars, on
August 15, 2007.
Interest Payment Dates: February 15 and August 15, commencing
February 15, 1998.
Interest Record Dates: February 1 and August 1
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
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78
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officer.
HERMES EUROPE RAILTEL B.V.
By:_______________________________
Name:
Title:
Attest:__________________________
Name:
Title:
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 11-1/2% Senior Notes due 2007, described in
the within-mentioned Indenture.
Dated: , 0000
XXX XXXX XX XXX XXXX,
as Trustee
By:______________________________
Authorized Signatory
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79
(REVERSE OF SECURITY)
HERMES EUROPE RAILTEL B.V.
11-1/2% Senior Note due 2007
1. Interest.
HERMES EUROPE RAILTEL B.V., a Netherlands limited company (the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above. Cash interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from August 19, 1997. The Company will pay interest semi-annually in
arrears on each Interest Payment Date, commencing February 15, 1998. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities and on overdue
installments of interest (without regard to any applicable grace periods) at the
rate borne by the Securities to the extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Interest Record Date immediately preceding the Interest
Payment Date even if the Securities are cancelled on registration of transfer or
registration of exchange after such Interest Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts ("U.S. Legal
Tender"). However, the Company may pay principal and interest by wire transfer
of Federal funds (provided that the Paying Agent shall have received wire
instructions on or prior to the relevant Interest Record Date), or interest by
check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address.
3. Paying Agent and Registrar.
Initially, The Bank of New York (the "Trustee") will act as
Paying Agent and Registrar in the Borough of Manhattan, The City of New York,
and Banque Internationale a Luxembourg S.A. will act as Paying Agent and
Registrar in Luxembourg. The Company may change any Paying Agent or Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar.
4. Indenture.
The Company issued the Securities under an Indenture, dated as
of August 19, 1997 (the "Indenture"), among the Company, Global TeleSystems
Group, Inc. and the Trustee. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture
A-5
80
Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in effect on
the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and holders of Securities are referred
to the Indenture and the TIA for a statement of them. This is one of the Series
A Securities referred to in the Indenture. The Series A Securities and the
Series B Securities referred to in the Indenture are general obligations of the
Company limited in aggregate principal amount to $265,000,000.
5. Optional Redemption.
(a) The Securities will be redeemable at the option of the Company, in
whole or in part, at any time or from time to time, on or after August 15, 2002
at the redemption prices (expressed as a percentage of principal amount) set
forth below, plus accrued and unpaid interest thereon, if any, to the redemption
date if redeemed during the twelve-month period commencing on of the years set
forth below:
Redemption
Year Price
---- ---------
2002 105.750%
2003 103.833%
2004 101.917%
2005 and thereafter 100.000%
(b) Redemption Upon Public Equity Offering or Strategic Equity
Investment.
At any time, or from time to time, prior to August 15, 2000,
the Company may redeem Securities at a redemption price equal to 111.5% of the
principal amount of the Securities so redeemed, plus accrued and unpaid interest
thereon, if any, to the redemption date, with the net cash proceeds of one or
more Public Equity Offerings or Strategic Equity Investments resulting in
aggregate gross cash proceeds to the Company of at least $75 million; provided,
however, that at least two-thirds of the principal amount of Securities
originally issued would remain outstanding immediately after giving effect to
any such redemption (excluding any Securities owned by the Company or any of its
Affiliates) (it being understood that the foregoing shall not apply to proceeds
received in connection with the GTS Contribution). Notice of any such redemption
must be given within 60 days after the date of the last Public Equity Offering
or Strategic Equity Investment resulting in gross cash proceeds to the Company,
when aggregated with all prior Public Equity Offerings and Strategic Equity
Investments, of at least $75.0 million.
(c) Redemption for Changes in Withholding Taxes.
The Company may, at any time, at its option, redeem all (but
not less than all) of the Securities then outstanding at 100% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the date of
redemption, if the Company has become or would become obligated to pay, on the
next date on which any amount would be payable with respect to the Securities,
any Additional Amounts as a result of change in law (including any regulations
promulgated thereunder) or in the interpretation or administration thereof, if
such change is announced and becomes effective on or after the Issue Date.
A-6
81
6. Notice of Redemption.
Notice of redemption will be mailed by first-class mail at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at its registered address; provided,
however, that notice of redemption pursuant to paragraph 5(b) of this Security
will be mailed to each Holder of Securities to be redeemed no later than 60 days
following the consummation of the last Public Equity Offering resulting in gross
cash proceeds to the Company, when aggregated with all prior Public Equity
Offerings, of at least $75.0 million. The Trustee may select for redemption
portions of the principal amount of Securities that have denominations equal to
or larger than $1,000 principal amount. Securities and portions of them the
Trustee so selects shall be in amounts of $1,000 principal amount or integral
multiples thereof.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, interest will cease to accrue on Securities or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent for the
Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
7. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all outstanding Securities at a purchase price
in cash equal to 101% of the aggregate principal amount thereof, plus accrued
and unpaid interest thereon, if any, to the Purchase Date.
8. Limitation on Disposition of Assets.
Upon the occurrence of certain Asset Sales, the Company is,
subject to certain conditions, obligated to make an offer to purchase Securities
at a purchase price in cash equal to 100% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon, if any, to the Purchase Date.
9. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption, except the
unredeemed portion of any security being redeemed in part.
10. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
X-0
00
00. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Company at its written request. After that, all liability of the Trustee
and such Paying Agent with respect to such funds shall cease.
12. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from obligations to comply with certain covenants contained in the
Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
13. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture and the
Securities may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or compliance with any provision may
be waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture and the
Securities to, among other things, cure any ambiguity, defect or inconsistency,
provide for uncertificated Securities in addition to or in place of certificated
Securities, effect the assumption by a successor person of all obligations of
the Company under Securities, the Indenture, the Registration Rights Agreement
and the Escrow Agreement in connection with any transaction complying with
Article Five of the Indenture or comply with any requirements of the SEC in
connection with the qualification of the Indenture under the TIA, or make any
other change that does not materially adversely affect the rights of any Holder
of a Security.
14. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and the Restricted Subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to sell assets, to
permit restrictions on dividends and other payments to become applicable to
Restricted Subsidiaries, to consolidate, merge or sell all or substantially all
of its assets, to engage in transactions with affiliates or certain other
related persons. The limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
15. Defaults and Remedies.
If an Event of Default (other than certain events of
bankruptcy, insolvency or reorganization affecting the Company) occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Securities then outstanding by notice in writing to the Company may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. If certain events of bankruptcy,
insolvency or reorganization affecting the Company occur under the Indenture,
the Securities will ipso facto become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder of Securities.
Holders of Securities may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee is not obligated to enforce the Indenture
or the Securities unless it has received indemnity reasonably satisfactory to
it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Securities then
outstanding
A-8
83
to direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of certain continuing Defaults if it
determines that withholding notice is in their interest.
16. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
17. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company or any of its Affiliates shall have any liability for
any obligation of the Company or any of its Affiliates under the Securities or
the Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Security by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
18. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
19. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security 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).
20. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
21. Governing Law.
The laws of the State of New York shall govern the Indenture
and this Security without regard to principles of conflicts of laws.
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84
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint_________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated:___________________ Signed: ______________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
85
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.10 or Section 4.16 of the Indenture, check the
appropriate box:
Section 4.10 [ ]
Section 4.16 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.10 or Section 4.16 of the
Indenture, state the amount: $_____________
Dated:___________________ Your Signature:____________________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
86
EXHIBIT B
(FORM OF SERIES B SECURITY)
HERMES EUROPE RAILTEL B.V.
11-1/2% Senior Note due 2007, Series B
CUSIP No.:
No. $
HERMES EUROPE RAILTEL B.V., a Netherlands limited company (the
"Company", which term includes any successor corporation), for value received
promises to pay to or registered assigns, the principal sum of Dollars, on
August 15, 2007.
Interest Payment Dates: February 15 and August 15, commencing
February 15, 1998.
Interest Record Dates: February 1 and August 1
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
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87
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officer.
HERMES EUROPE RAILTEL B.V.
By:___________________________________
Name:
Title:
Attest:____________________________
Name:
Title:
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 11-1/2% Senior Notes due 2007, Series B,
described in the within-mentioned Indenture.
Dated: , 0000
XXX XXXX XX XXX XXXX,
as Trustee
By:___________________________________
Authorized Signatory
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(REVERSE OF SECURITY)
HERMES EUROPE RAILTEL B.V.
11-1/2% Senior Note due 2007, Series B
1. Interest.
HERMES EUROPE RAILTEL B.V., a Netherlands limited company (the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above. Cash interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from August 19, 1997. The Company will pay interest semi-annually in
arrears on each Interest Payment Date, commencing February 15, 1998. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities and on overdue
installments of interest (without regard to any applicable grace periods) at the
rate borne by the Securities to the extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Interest Record Date immediately preceding the Interest
Payment Date even if the Securities are cancelled on registration of transfer or
registration of exchange after such Interest Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts ("U.S. Legal
Tender"). However, the Company may pay principal and interest by wire transfer
of Federal funds (provided that the Paying Agent shall have received wire
instructions on or prior to the relevant Interest Record Date), or interest by
check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address.
3. Paying Agent and Registrar.
Initially, The Bank of New York (the "Trustee") will act as
Paying Agent and Registrar in the Borough of Manhattan, The City of New York,
and Banque Internationale a Luxembourg S.A. will act as Paying Agent and
Registrar in Luxembourg. The Company may change any Paying Agent or Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar.
4. Indenture.
The Company issued the Securities under an Indenture, dated as
of August 19, 1997 (the "Indenture"), among the Company, Global TeleSystems
Group, Inc. and the Trustee. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture
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89
Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in effect on
the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and holders of Securities are referred
to the Indenture and the TIA for a statement of them. This is one of the Series
A Securities referred to in the Indenture. The Series A Securities and the
Series B Securities referred to in the Indenture are general obligations of the
Company limited in aggregate principal amount to $265,000,000.
5. Optional Redemption.
(a) The Securities will be redeemable at the option of the Company, in
whole or in part, at any time or from time to time, on or after August 15, 2002
at the redemption prices (expressed as a percentage of principal amount) set
forth below, plus accrued and unpaid interest thereon, if any, to the redemption
date if redeemed during the twelve-month period commencing on of the years set
forth below:
Redemption
Year Price
---- ---------
2002 105.750%
2003 103.833%
2004 101.917%
2005 and thereafter 100.000%
(b) Redemption Upon Public Equity Offering or Strategic Equity
Investment.
At any time, or from time to time, prior to August 15, 2000,
the Company may redeem Securities at a redemption price equal to 111.5% of the
principal amount of the Securities so redeemed, plus accrued and unpaid interest
thereon, if any, to the redemption date, with the net cash proceeds of one or
more Public Equity Offerings or Strategic Equity Investments resulting in
aggregate gross cash proceeds to the Company of at least $75 million; provided,
however, that at least two-thirds of the principal amount of Securities
originally issued would remain outstanding immediately after giving effect to
any such redemption (excluding any Securities owned by the Company or any of its
Affiliates) (it being understood that the foregoing shall not apply to proceeds
received in connection with the GTS Contribution). Notice of any such redemption
must be given within 60 days after the date of the last Public Equity Offering
or Strategic Equity Investment resulting in gross cash proceeds to the Company,
when aggregated with all prior Public Equity Offerings and Strategic Equity
Investments, of at least $75.0 million.
(c) Redemption for Changes in Withholding Taxes.
The Company may, at any time, at its option, redeem all (but
not less than all) of the Securities then outstanding at 100% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the date of
redemption, if the Company has become or would become obligated to pay, on the
next date on which any amount would be payable with respect to the Securities,
any Additional Amounts as a result of change in law (including any regulations
promulgated thereunder) or in the interpretation or administration thereof, if
such change is announced and becomes effective on or after the Issue Date.
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90
6. Notice of Redemption.
Notice of redemption will be mailed by first-class mail at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at its registered address; provided,
however, that notice of redemption pursuant to paragraph 5(b) of this Security
will be mailed to each Holder of Securities to be redeemed no later than 60 days
following the consummation of the last Public Equity Offering resulting in gross
cash proceeds to the Company, when aggregated with all prior Public Equity
Offerings, of at least $75.0 million. The Trustee may select for redemption
portions of the principal amount of Securities that have denominations equal to
or larger than $1,000 principal amount. Securities and portions of them the
Trustee so selects shall be in amounts of $1,000 principal amount or integral
multiples thereof.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, interest will cease to accrue on Securities or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent for the
Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
7. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all outstanding Securities at a purchase price
in cash equal to 101% of the aggregate principal amount thereof, plus accrued
and unpaid interest thereon, if any, to the Purchase Date.
8. Limitation on Disposition of Assets.
Upon the occurrence of certain Asset Sales, the Company is,
subject to certain conditions, obligated to make an offer to purchase Securities
at a purchase price in cash equal to 100% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon, if any, to the Purchase Date.
9. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption, except the
unredeemed portion of any security being redeemed in part.
10. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
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00
00. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Company at its written request. After that, all liability of the Trustee
and such Paying Agent with respect to such funds shall cease.
12. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from obligations to comply with certain covenants contained in the
Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
13. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture and the
Securities may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or compliance with any provision may
be waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture and the
Securities to, among other things, cure any ambiguity, defect or inconsistency,
provide for uncertificated Securities in addition to or in place of certificated
Securities, effect the assumption by a successor person of all obligations of
the Company under Securities, the Indenture, the Registration Rights Agreement
and the Escrow Agreement in connection with any transaction complying with
Article Five of the Indenture or comply with any requirements of the SEC in
connection with the qualification of the Indenture under the TIA, or make any
other change that does not materially adversely affect the rights of any Holder
of a Security.
14. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and the Restricted Subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to sell assets, to
permit restrictions on dividends and other payments to become applicable to
Restricted Subsidiaries, to consolidate, merge or sell all or substantially all
of its assets, to engage in transactions with affiliates or certain other
related persons. The limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
15. Defaults and Remedies.
If an Event of Default (other than certain events of
bankruptcy, insolvency or reorganization affecting the Company) occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Securities then outstanding by notice in writing to the Company may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. If certain events of bankruptcy,
insolvency or reorganization affecting the Company occur under the Indenture,
the Securities will ipso facto become immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder of Securities.
Holders of Securities may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee is not obligated to enforce the Indenture
or the Securities unless it has received indemnity reasonably satisfactory to
it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Securities then
outstanding
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92
to direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of certain continuing Defaults if it
determines that withholding notice is in their interest.
16. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
17. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company or any of its Affiliates shall have any liability for
any obligation of the Company or any of its Affiliates under the Securities or
the Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Security by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
18. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
19. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security 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).
20. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
21. Governing Law.
The laws of the State of New York shall govern the Indenture
and this Security without regard to principles of conflicts of laws.
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ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint_________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated:___________________ Signed:______________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
94
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.10 or Section 4.16 of the Indenture, check the
appropriate box:
Section 4.10 [ ]
Section 4.16 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.10 or Section 4.16 of the
Indenture, state the amount: $_____________
Dated:___________________ Your Signature:___________________________________
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
95
EXHIBIT C
FORM OF LEGEND FOR GLOBAL SECURITIES
Any Global Security authenticated and delivered hereunder
shall bear a legend (which would be in addition to any other legends required in
the case of a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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EXHIBIT D
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
Re: 11-1/2% Senior Notes due 2007
(the "Securities"), of Hermes Europe Railtel B.V.
This Certificate relates to $_______ principal amount of
Securities held in the form of* ___ a beneficial interest in a Global Security
or* _______ Physical Securities by_____________________ (the "Transferor").
The Transferor:*
|_| has requested by written order that the Registrar deliver in
exchange for its beneficial interest in the Global Security held by the
Depositary a Physical Security or Physical Securities in definitive, registered
form of authorized denominations and an aggregate number equal to its beneficial
interest in such Global Security (or the portion thereof indicated above); or
|_| has requested that the Registrar by written order to exchange or
register the transfer of a Physical Security or Physical Securities.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify that the Transferor is familiar
with the Indenture relating to the above captioned Securities and the
restrictions on transfers thereof as provided in Section 2.06 of such Indenture,
and that the transfer of the Securities does not require registration under the
Securities Act of 1933, as amended (the "Act"), because*:
|_| Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.06 of the Indenture).
|_| Such Security is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Act), in reliance on Rule 144A.
|_| Such Security is being transferred to an institutional "accredited
investor" (within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule
501 under the Act) which delivers a certificate to the Trustee in the form of
Exhibit E to the Indenture. An opinion of counsel to the effect that such
transfer does not require registration under the Securities Act accompanies this
certification.
|_| Such Security is being transferred in reliance on Regulation S
under the Act. An opinion of counsel to the effect that such transfer does not
require registration under the Securities Act accompanies this certification.
|_| Such Security is being transferred in reliance on Rule 144 under
the Act. An opinion of counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this certification.
|_| Such Security is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Act other than Rule
144A or Rule 144 or Regulation S under the Act to a person other than an
institutional "accredited investor." An opinion of counsel to the effect that
such transfer does not require registration under the Securities Act accompanies
this certification.
_________________________________
[INSERT NAME OF XXXXXXXXXX]
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By:_____________________________
[Authorized Signatory]
Date: _____________
*Check applicable box.
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EXHIBIT E
Form of Certificate To Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
---------------, ----
Attention: Corporate Trust Administration
Re: Hermes Europe Railtel B.V. (the "Company")
Indenture (the "Indenture") relating to 11-1/2%
Senior Notes due 2007
Ladies and Gentlemen:
In connection with our proposed purchase of $ aggregate
principal amount of 11-1/2% Senior Notes due 2007 (the "Notes") of Hermes Europe
Railtel B.V., a Netherlands limited company (the "Company"), we confirm that:
1. We understand that the Notes have not been registered under
the Securities Act of 1933, as amended (the "Securities Act"), and
may not be sold except as permitted in the following sentence. We
understand and agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, (x) that
such Notes are being offered only in a transaction not involving
any public offering within the meaning of the Securities Act and
(y) that if we decide to resell, pledge or otherwise transfer such
Notes within two years after the date of the original issuance of
the Notes or if within three months after we cease to be an
affiliate (within the meaning of Rule 144 under the Securities Act)
of the Company, such Notes may be resold, pledged or transferred
only (i) to the Company, (ii) so long as the Notes are eligible for
resale pursuant to Rule 144A under the Securities Act ("Rule
144A"), to a person whom we reasonably believe is a "qualified
institution buyer" (as defined in Rule 144A) ("QIB") that purchases
for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance
on Rule 144A (as indicated by the box checked by the transferor on
the Certificate of Transfer on the reverse of the certificate for
the Notes), (iii) in an offshore transaction in accordance with
Regulation S under the Securities Act (as indicated by the box
checked by the transferor on the Certificate of Transfer on the
reverse of the Note if the Note is not in book-entry form), and, if
such transfer is being effected by certain transferors prior to the
expiration of the "40 day restricted period" (within the meaning of
Rule 903(c)(2) of Regulation S under the Securities Act), a
certificate that my be obtained from the Trustee is delivered by
the transferee, (iv) to an institution that is an "accredited
investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act (as indicated by the box checked by the transferor
on the Certificate of Transfer on the reverse of the certificate
for the Notes) which has certified to the Company and the Trustee
for the Notes that it is such an accredited investor and is
acquiring the Notes for investment purposes and not for
distribution (provided that no Notes purchased from a foreign
purchaser or from any person other than a QIB or an institutional
accredited investor pursuant to this clause (iii) shall be
permitted to transfer any Notes so purchased to an institutional
accredited investor pursuant to this
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xxxxxx (xx) prior to the expiration of the "applicable restricted
period" (within the meaning of Regulation S under the Securities
Act)), (v) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 (if applicable) under the
Securities Act, or (vi) pursuant to an effective registration
statement under the Securities Act, in each case in accordance with
any applicable securities laws of any state of the United States,
and we will notify any purchaser of the Notes from us of the above
resale restriction, if then applicable. We further understand that
in connection with any transfer of the Notes by us that the Company
and the Trustee for the Notes may request, and if so requested we
will furnish, such certificates, legal opinions and other
information as they may reasonably require to confirm that any such
transfer complies with the foregoing restrictions.
2. We are able to fend for ourselves in the transactions
contemplated by this Offering Memorandum, we 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 and can afford the
complete loss of such investment.
3. We understand that the minimum principal amount of Notes
that may be purchased by an investor is $250,000.
4. We understand that the Company, Xxxxxxxxx, Xxxxxx &
Xxxxxxxx Securities Corporation, UBS Securities LLC and Xxxxxx
Brothers Inc., as the initial purchasers of the Securities
("Initial Purchasers"), and others will rely upon the truth and
accuracy of the foregoing acknowledgments, representations and
agreements and we agree that if any of the acknowledgments,
representations and warranties deemed to have been made by us by
our purchase of Notes, for our own account or of one or more
accounts as to each of which we exercise sole investment
discretion, are no longer accurate, we shall promptly notify the
Company and the Initial Purchasers.
5. We are acquiring the Notes purchased by us for investment
purposes and not for distribution of our own account or for one or
more accounts as to each of which we exercise sole investment
discretion and we are or such account is an institutional
"accredited investor" (as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act).
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0. You are entitled to rely upon this letter and you are
irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
________________________________________
(Name of Purchaser)
By: ___________________________________
Date: __________________________________
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XXXXXXX X
Form of Certificate To Be
Delivered in Connection
with Regulation S Transfers
---------------, ----
Attention: Corporate Trust Administration
Re: Hermes Europe Railtel B.V. (the "Company") 11-1/2%
Senior Notes due 2007 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $____________
aggregate principal amount of the Securities, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the Securities
Act of 1933, as amended (the "Securities Act"), and, accordingly, we represent
that:
(1) the offer of the Securities was not made to a person in
the United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated off-shore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer
restrictions applicable to the Securities.
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. Defined terms used herein without
definition have the respective meanings provided in Regulation S.
Very truly yours,
[Name of Transferor]
By: _________________________
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