COVANTA HOLDING CORPORATION and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee SECOND SUPPLEMENTAL INDENTURE Dated as of December 1, 2010 $400,000,000 Aggregate Principal Amount of 7.250% Senior Notes due 2020
Exhibit 4.3
COVANTA HOLDING CORPORATION
and
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
as Trustee
Dated as of December 1, 2010
$400,000,000 Aggregate Principal Amount of
7.250% Senior Notes due 2020
7.250% Senior Notes due 2020
TABLE OF CONTENTS
| Page | ||||
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE |
2 | |||
SECTION 1.01. Definitions |
2 | |||
ARTICLE 2 ISSUE AND DESCRIPTION OF NOTES |
38 | |||
SECTION 2.01. Designation and Amount |
38 | |||
SECTION 2.02. Form of the Notes |
39 | |||
SECTION 2.03. Date and Denomination of Notes; Payment at Maturity; Payment of
Interest |
39 | |||
SECTION 2.04. Defaulted Interest |
40 | |||
ARTICLE 3 REDEMPTION OF NOTES |
40 | |||
SECTION 3.01. Optional Redemption |
40 | |||
SECTION 3.02. Mandatory Redemption; Open Market Purchases |
41 | |||
SECTION 3.03. Notice of Redemption |
41 | |||
SECTION 3.04. Selection of Notes to be Redeemed |
42 | |||
SECTION 3.05. Notes Redeemed in Part |
43 | |||
ARTICLE 4 ADDITIONAL COVENANTS |
43 | |||
SECTION 4.01. Reporting Covenant |
43 | |||
SECTION 4.02. Covenant Suspension |
44 | |||
SECTION 4.03. Limitation on Indebtedness |
45 | |||
SECTION 4.04. Limitation on Restricted Payments |
50 | |||
SECTION 4.05. Limitation on Liens |
55 | |||
SECTION 4.06. Limitation on Sale/Leaseback Transactions |
55 | |||
SECTION 4.07. Offer to Repurchase upon Change of Control |
56 | |||
SECTION 4.08. Asset Sales |
57 | |||
SECTION 4.09. Limitation on Restrictions on Distributions from Restricted Subsidiaries |
61 | |||
SECTION 4.10. Limitation on Affiliate Transactions |
63 | |||
SECTION 4.11. Payments for Consent |
65 | |||
SECTION 4.12. Limitation on Company Activities |
65 | |||
ARTICLE 5 CONSOLIDATION, MERGER AND SALE OF ASSETS |
65 | |||
SECTION 5.01. When Company May Merge or Transfer Assets |
65 | |||
SECTION 5.02. Successor Corporation Substituted |
66 | |||
ARTICLE 6 DEFAULTS AND REMEDIES |
67 | |||
SECTION 6.01. Events of Default |
67 | |||
SECTION 6.02. Acceleration of Maturity; Rescission and Annulment |
69 | |||
SECTION 6.03. Limitation on Suits |
69 | |||
ARTICLE 7 NOTICE OF DEFAULTS |
70 | |||
SECTION 7.01. Notice of Defaults |
70 | |||
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| Page | ||||
ARTICLE 8 DISCHARGE OF INDENTURE |
71 | |||
SECTION 8.01. Discharge of Liability on Notes |
71 | |||
SECTION 8.02. Defeasance |
72 | |||
SECTION 8.03. Covenant Defeasance |
72 | |||
SECTION 8.04. Conditions to Defeasance |
72 | |||
ARTICLE 9 AMENDMENTS |
74 | |||
SECTION 9.01. Without Consent of Noteholders |
74 | |||
SECTION 9.02. With Consent of Noteholders |
75 | |||
ARTICLE 10 MISCELLANEOUS |
76 | |||
SECTION 10.01. Second Supplemental Indenture Controls |
76 | |||
SECTION 10.02. GOVERNING LAW |
76 | |||
SECTION 10.03. Successors |
76 | |||
SECTION 10.04. Multiple Originals |
77 | |||
SECTION 10.05. Table of Contents; Headings |
77 | |||
SECTION 10.06. No Responsibility by Trustee |
77 | |||
SECTION 10.07. Calculations |
77 | |||
SECTION 10.08. No Guarantees |
77 | |||
SECTION 10.09. No Sinking Fund |
77 | |||
SECTION 10.10. U.S.A. Patriot Act |
77 | |||
SECTION 10.11. Force Majeure |
77 | |||
Exhibit A — Form of Note
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THIS SECOND SUPPLEMENTAL INDENTURE dated as of December 1, 2010 between Covanta Holding
Corporation, a Delaware corporation, as issuer (hereinafter sometimes called the “Company”), and
Xxxxx Fargo Bank, National Association, a national banking association, as trustee (hereinafter
sometimes called the “Trustee”).
W I T N E S S E T H:
WHEREAS, the Company has heretofore entered into a Senior Indenture, dated as of January 18,
2007 (the “Original Indenture”), with the Trustee;
WHEREAS, the Original Indenture is incorporated herein by this reference and the Original
Indenture, as may be amended and supplemented to the date hereof, including by this Second
Supplemental Indenture, is herein called the “Indenture”;
WHEREAS, under the Original Indenture, a new series of securities may at any time be
established in accordance with the provisions of the Original Indenture and the terms of such
series may be described by a supplemental indenture executed by the Company and the Trustee;
WHEREAS, Section 2.1 of the Original Indenture expressly permits the Company and the Trustee
to enter into one or more indentures supplemental thereto for the purpose of establishing the form
or terms of Securities to be issued under the Indenture without the consent of the holders of any
Outstanding Securities pursuant to Section 10.1 of the Original Indenture;
WHEREAS, for its lawful corporate purposes, the Company hereby proposes to create under the
Indenture an additional series of securities to be designated as the Company’s 7.250% Senior Notes
due 2020 (hereinafter sometimes called the “Notes”), in an aggregate principal amount of
$400,000,000, and in order to provide the terms and conditions upon which the Notes are to be
authenticated, issued and delivered, the Company has duly authorized the execution and delivery of
this Second Supplemental Indenture;
WHEREAS, the Form of Note, the certificate of authentication to be borne by each Note are to
be substantially in the forms hereinafter provided for; and
WHEREAS, all acts and things necessary to make the Notes, when executed by the Company and
authenticated and delivered by the Trustee or a duly authorized authenticating agent, as in the
Indenture provided, the valid, binding and legal obligations of the Company, and to constitute
these presents a valid agreement according to its terms, have been done and performed, and the
execution of this Second Supplemental Indenture and the issue of the Notes have in all respects
been duly authorized.
NOW, THEREFORE, in consideration of the premises, the Company covenants and agrees with the
Trustee for the equal and proportionate benefit of the holders from time to time of the Notes
(except as otherwise provided below), as follows:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions. All terms contained in this Second Supplemental
Indenture shall, except as specifically provided herein or except as the context may otherwise
require, have the meanings given to such terms in the Original Indenture. In the event of any
inconsistency between the Original Indenture and this Second Supplemental Indenture, this Second
Supplemental Indenture shall govern. The words “herein,” “hereof,” “hereunder,” and words of
similar import refer to this Second Supplemental Indenture as a whole and not to any particular
Article, Section or other subdivision. The terms defined in this Article include the plural as
well as the singular.
SECTION 1.02. Solely with respect to the Notes, the following definitions shall be added to
Section 1.1 of the Original Indenture and replace any existing definitions of such term (as
applicable) in the Original Indenture, each in appropriate alphabetical order. Unless the context
otherwise requires, the following terms shall have the following meanings:
“Acquired Indebtedness” means, with respect to any specified Person, (a) Indebtedness of any
Person or any of its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary
or (b) assumed in connection with the acquisition of assets from such Person, in each case whether
or not Incurred by such Person in connection with, or in anticipation or contemplation of, such
Person becoming a Restricted Subsidiary or such acquisition, and Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person. Acquired Indebtedness shall be deemed to
have been Incurred, with respect to clause (a) of the preceding sentence, on the date such Person
becomes a Restricted Subsidiary and, with respect to clause (b) of the preceding sentence, on the
date of consummation of such acquisition of assets.
“Additional Assets” means:
(1) any property, plant, equipment or other asset (excluding working capital or current assets
for the avoidance of doubt) to be used by the Company or a Restricted Subsidiary in a Similar
Business;
(2) the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or a Restricted Subsidiary; or
(3) Capital Stock constituting a minority interest in any Person that at such time is a
Restricted Subsidiary;
provided, however, that, in the case of clauses (2) and (3), such Restricted Subsidiary is
primarily engaged in a Similar Business.
“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 the purposes of this definition, “control” (including, with correlative meanings, the terms
“controlling,” “controlled by” and “under common control with”) when used with respect
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to any Person means possession, directly or indirectly, of the power to direct the management
and policies of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing; provided that exclusively for purposes of Section 4.08 and Section
4.10, beneficial ownership of 10% or more of the Voting Stock of a Person shall be deemed to be
control.
“Applicable Premium” means, with respect to a Note on any date of redemption, the greater of:
(1) 1.0% of the principal amount of such Note, and
(2) the excess, if any, of (a) the present value as of such date of redemption of (i) the
redemption price of such Note on December 1, 2015 (such redemption price being described under
Section 3.01) plus (ii) all required interest payments due on such Note through December 1, 2015
(excluding accrued but unpaid interest to the date of redemption), computed using a discount rate
equal to the Treasury Rate as of such date of redemption plus 50 basis points, over (b) the
then-outstanding principal of such Note.
“Asset Disposition” means any direct or indirect sale, lease (other than an operating lease
entered into in the ordinary course of business), transfer, issuance or other disposition, or a
series of related sales, leases, transfers, issuances or dispositions that are part of a common
plan, of shares of Capital Stock of a Subsidiary (other than directors’ qualifying shares),
property or other assets (each referred to for the purposes of this definition as a “disposition”)
by the Company or any of its Restricted Subsidiaries, including any disposition by means of a
merger, consolidation or similar transaction.
Notwithstanding the preceding, the following items shall not be deemed to be Asset
Dispositions:
(1) a disposition of assets by a Restricted Subsidiary to the Company or by the Company or a
Restricted Subsidiary to a Restricted Subsidiary (other than a Receivables Entity);
(2) the sale of Cash Equivalents in the ordinary course of business;
(3) a disposition of inventory in the ordinary course of business;
(4) a disposition of obsolete or worn out equipment or equipment that is no longer useful in
the conduct of the business of the Company and its Restricted Subsidiaries and that is disposed of
in each case in the ordinary course of business;
(5) the disposition of all or substantially all of the assets of the Company in a manner
permitted pursuant to Section 5.01 or any disposition that constitutes a Change of Control pursuant
to this Second Supplemental Indenture;
(6) an issuance of Capital Stock by a Restricted Subsidiary to the Company or to a Wholly
Owned Subsidiary (other than a Receivables Entity);
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(7) disposition of the Capital Stock or all or substantially all of the assets of any
Unrestricted Asian Subsidiary and any Insurance Subsidiary;
(8) for purposes of Section 4.08 hereof only, the making of a Permitted Investment (other than
a Permitted Investment to the extent such transaction results in the receipt of cash or Cash
Equivalents by the Company or its Restricted Subsidiaries) or a disposition subject to Section 4.04
hereof;
(9) sales of accounts receivable and related assets or an interest therein of the type
specified in the definition of “Qualified Receivables Transaction” to a Receivables Entity;
(10) dispositions of assets with an aggregate fair market value since the Issue Date of less
than $25.0 million;
(11) the creation of a Permitted Lien and dispositions in connection with Permitted Liens;
(12) dispositions of receivables in connection with the compromise, settlement or collection
thereof in the ordinary course of business or in bankruptcy or similar proceedings and exclusive of
factoring or similar arrangements;
(13) the issuance by a Restricted Subsidiary of Preferred Stock that is permitted by the
covenant described under Section 4.03 hereof;
(14) the licensing or sublicensing of intellectual property or other general intangibles and
licenses, leases or subleases of other property in the ordinary course of business, which do not
materially interfere with the business of the Company and its Restricted Subsidiaries;
(15) foreclosure on assets; and
(16) any sale of Capital Stock in, or Indebtedness or other securities of, an Unrestricted
Subsidiary.
“Attributable Indebtedness” in respect of a Sale/Leaseback Transaction means, as at the time
of determination, the present value (discounted at the interest rate implicit in the transaction)
of the total obligations of the lessee for rental payments during the remaining term of the lease
included in such Sale/Leaseback Transaction (including any period for which such lease has been
extended), determined in accordance with GAAP; provided, however, that if such Sale/Leaseback
Transaction results in a Capitalized Lease Obligation, the amount of Indebtedness represented
thereby will be determined in accordance with the definition of “Capitalized Lease Obligations.”
“Average Life” means, as of the date of determination, with respect to any Indebtedness or
Preferred Stock, the quotient obtained by dividing (1) the sum of the products of the numbers of
years from the date of determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such Preferred Stock multiplied
by the amount of such payment by (2) the sum of all such payments.
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“Board of Directors” means:
(1) with respect to a corporation, the Board of Directors of the corporation or (other than
for purposes of determining Change of Control) the executive committee or applicable independent
committee of the Board of Directors;
(2) with respect to a partnership, the Board of Directors of the general partner of the
partnership; and
(3) with respect to any other Person, the board or committee of such Person serving a similar
function.
“Business Day” means each day that is not a Saturday, Sunday or other day on which banking
institutions in New York, New York are authorized or required by law to close.
“Capital Stock” of any Person means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in (however designated)
equity of such Person, including any Preferred Stock and limited liability or partnership interests
(whether general or limited), but excluding any debt securities convertible into such equity.
“Capitalized Lease Obligations” means an obligation that is required to be classified and
accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP, and
the amount of Indebtedness represented by such obligation will be the capitalized amount of such
obligation at the time any determination thereof is to be made as determined in accordance with
GAAP, and the Stated Maturity thereof will be the date of the last payment of rent or any other
amount due under such lease prior to the first date such lease may be terminated without penalty.
“Cash Equivalents” means:
(1) U.S. dollars, or in the case of any Foreign Subsidiary, such local currencies held by it
from time to time in the ordinary course of business;
(2) securities issued or directly and fully Guaranteed or insured by the United States
Government or any agency or instrumentality of the United States (provided that the full faith and
credit of the United States is pledged in support thereof), having maturities of not more than one
year from the date of acquisition;
(3) marketable general obligations issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality thereof maturing within one
year from the date of acquisition and, at the time of acquisition, having a credit rating of “A” or
better from either Standard & Poor’s Ratings Group, Inc. or Xxxxx’x Investors Service, Inc., or
carrying an equivalent rating by a nationally recognized Rating Agency, if both of the two named
Rating Agencies cease publishing ratings of investments;
(4) certificates of deposit, time deposits, eurodollar time deposits, overnight bank deposits
or bankers’ acceptances having maturities of not more than one year from the date
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of acquisition thereof issued by any commercial bank the long-term debt of which is rated at
the time of acquisition thereof at least “A” or the equivalent thereof by Standard & Poor’s Ratings
Group, Inc., or “A” or the equivalent thereof by Xxxxx’x Investors Service, Inc., or carrying an
equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating
Agencies cease publishing ratings of investments, and having combined capital and surplus in excess
of $250.0 million;
(5) repurchase obligations with a term of not more than seven days for underlying securities
of the types described in clauses (2), (3) and (4) entered into with any bank meeting the
qualifications specified in clause (4) above;
(6) commercial paper rated at the time of acquisition thereof at least “A-2” or the equivalent
thereof by Standard & Poor’s Ratings Group, Inc. or “P-2” or the equivalent thereof by Xxxxx’x
Investors Service, Inc., or carrying an equivalent rating by a nationally recognized Rating Agency,
if both of the two named Rating Agencies cease publishing ratings of investments, and in any case
maturing within one year after the date of acquisition thereof;
(7) interests in any investment company or money market fund which invests 95% or more of its
assets in instruments of the type specified in clauses (1) through (6) above; and
(8) similar foreign currency denominated securities, obligations, certificate of deposits and
commercial paper of comparable rating and quality held by Foreign Subsidiaries.
“Change of Control” means:
(1) any “person” or “group” of related persons (as such terms are used in Sections 13(d) and
14(d) of the Exchange Act but excluding any employee benefit plan of the Company and its
Subsidiaries and any person acting in its capacity as trustee, agent or other fiduciary or
administrator of such plan), becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that such person or group shall be deemed to have “beneficial
ownership” of all shares that any such person or group has the right to acquire, whether such right
is exercisable immediately or only after the passage of time), directly or indirectly, of more than
50% of the total voting power of the Voting Stock of the Company or any of its direct or indirect
parent entities (or their successors by merger, consolidation or purchase of all or substantially
all of their assets); or
(2) the first day on which a majority of the members of the Board of Directors of the Company
are not Continuing Directors; or
(3) the sale, assignment, conveyance, transfer, lease or other disposition (other than by way
of merger or consolidation), in one or a series of related transactions, of all or substantially
all of the assets of the Company and its Restricted Subsidiaries taken as a whole to any “person”
(as such term is used in Sections 13(d) and 14(d) of the Exchange Act); or
(4) the adoption by the stockholders of the Company of a plan or proposal for the liquidation
or dissolution of the Company.
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“Code” means the Internal Revenue Code of 1986, as amended, including rules and regulations
thereunder.
“Combined Leverage Ratio” means, as of any date of determination, the ratio of (x) (i) the
Consolidated Indebtedness of all Restricted Subsidiaries (excluding Indebtedness of any Excluded
Project Subsidiary in the Development Stage) as of such date minus (ii) the amount of Restricted
Cash of all Restricted Subsidiaries (excluding Restricted Cash of any Excluded Project Subsidiary
in the Development Stage) as of such date to (y) the aggregate amount of Consolidated Adjusted
EBITDA of all Restricted Subsidiaries (excluding Consolidated Adjusted EBITDA of any Excluded
Projected Subsidiary in the Development Stage) for the period of the most recent four consecutive
fiscal quarters ending prior to the date of such determination for which financial statements
prepared on a consolidated basis in accordance with GAAP are available, provided, however, that:
(1) if any Restricted Subsidiary:
(a) has Incurred any Indebtedness since the beginning of such period that
remains outstanding on such date of determination or if the transaction giving rise
to the need to calculate the Combined Leverage Ratio includes an Incurrence of
Indebtedness, Consolidated Adjusted EBITDA and Consolidated Indebtedness for such
period will be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day of such
period (except that in making such computation, the amount of Indebtedness under any
revolving Debt Facility outstanding on the date of such calculation will be deemed
to be (i) the average daily balance of such Indebtedness during such four fiscal
quarters or such shorter period for which such facility was outstanding or (ii) if
such facility was created after the end of such four fiscal quarters, the average
daily balance of such Indebtedness during the period from the date of creation of
such facility to the date of such calculation) and the discharge of any other
Indebtedness repaid, repurchased, redeemed, retired, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period; or
(b) has repaid, repurchased, redeemed, retired, defeased or otherwise
discharged any Indebtedness since the beginning of the period that is no longer
outstanding on such date of determination or if the transaction giving rise to the
need to calculate the Combined Leverage Ratio includes a discharge of Indebtedness
(in each case, other than Indebtedness Incurred under any revolving Debt Facility
unless such Indebtedness has been permanently repaid and the related commitment
terminated and not replaced), Consolidated Adjusted EBITDA and Consolidated
Indebtedness for such period will be calculated after giving effect on a pro forma
basis to such discharge of such Indebtedness, including with the proceeds of such
new Indebtedness, as if such discharge had occurred on the first day of such period;
(2) if since the beginning of such period, any Restricted Subsidiary will have made any Asset
Disposition or disposed of or discontinued (as defined under GAAP) any
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company, division, operating unit, segment, business, group of related assets or line of
business or if the transaction giving rise to the need to calculate the Combined Leverage Ratio
includes such a transaction, the Consolidated Adjusted EBITDA for such period shall be reduced by
an amount equal to the Consolidated Adjusted EBITDA (if positive) directly attributable to the
assets that are the subject of such disposition or discontinuation for such period or increased by
an amount equal to the Consolidated Adjusted EBITDA (if negative) directly attributable thereto for
such period;
(3) if since the beginning of such period the Company or any Restricted Subsidiary (by merger
or otherwise) (a) will have made an Investment in any Restricted Subsidiary (or any Person that
becomes a Restricted Subsidiary or is merged with or into a Restricted Subsidiary) or (b) an
acquisition of assets, including any acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder, which constitutes all or substantially all
of a company, division, operating unit, segment, business, group of related assets or line of
business, Consolidated Adjusted EBITDA for such period will be calculated after giving pro forma
effect thereto (including the Incurrence of any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period; and
(4) if since the beginning of such period any Person (that subsequently became a Restricted
Subsidiary or was merged with or into any Restricted Subsidiary since the beginning of such period)
will have Incurred any Indebtedness or discharged any Indebtedness, made any disposition or any
Investment or acquisition of assets that would have required an adjustment pursuant to clause (1),
(2) or (3) above if made by a Restricted Subsidiary during such period, Consolidated Adjusted
EBITDA and Consolidated Indebtedness for such period will be calculated after giving pro forma
effect thereto as if such transaction occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given to any calculation
under this definition, the pro forma calculations will be determined in good faith by a responsible
financial or accounting officer of the Company (including pro forma expense and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act). If any
Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest
expense on such Indebtedness will be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into account any Interest
Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement has a remaining term
in excess of 12 months). If any Indebtedness that is being given pro forma effect bears an
interest rate at the option of any Restricted Subsidiary, the interest rate shall be calculated by
applying such optional rate chosen by such Restricted Subsidiary.
“Commodity Agreement” means any long-term or forward purchase contract or option contract to
buy, sell or exchange commodities, commodity futures contract, commodity swap, commodity option or
other similar agreement or arrangement entered into by the Company or any Restricted Subsidiary
designed to protect the Company or any of its Restricted Subsidiaries against fluctuations in the
price of commodities in the ordinary course of business of the Company and its Restricted
Subsidiaries.
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“Common Stock” means with respect to any Person, any and all shares, interest or other
participations in, and other equivalents (however designated and whether voting or nonvoting) of
such Person’s common stock whether or not outstanding on the Issue Date, and includes, without
limitation, all series and classes of such common stock.
“Consolidated Adjusted EBITDA” means, with respect to any Person for any period, the
Consolidated Net Income of such Person for such period:
(1) increased (without duplication) by the following items to the extent deducted in
calculating such Consolidated Net Income:
(a) Consolidated Interest Expense; plus
(b) Consolidated Income Taxes; plus
(c) consolidated depreciation expense; plus
(d) consolidated amortization expense or impairment charges recorded in
connection with the application of Financial Accounting Standard No. 142 “Goodwill
and Other Intangibles” and Financial Accounting Standard No. 144 “Accounting for the
Impairment or Disposal of Long Lived Assets;” plus
(e) Transaction Costs and all legal, accounting and other expenses incurred in
connection with the Transactions or any acquisitions or Investments permitted under
this Second Supplemental Indenture to the extent deducted in determining
Consolidated Net Income for such period; plus
(f) extraordinary losses and unusual or non-recurring charges (including
restructuring charges and reserves), severance, relocation costs and curtailments or
modifications to pensions and post-retirement employee benefit plans; plus
(g) decreases in unbilled service receivables; plus
(h) other non-cash charges reducing Consolidated Net Income, including any
write-offs or write-downs (excluding any such non-cash charge to the extent it
represents an accrual of or reserve for cash charges in any future period or
amortization of a prepaid cash expense that was capitalized at the time of payment)
and non-cash compensation expense recorded from grants of stock appreciation or
similar rights, stock options, restricted stock or other rights to officers,
directors or employees;
(2) decreased (without duplication) by (a) non-cash items increasing Consolidated Net Income
of such Person for such period (excluding any items which represent the reversal of any accrual of,
or reserve for, anticipated cash charges that reduced Consolidated Adjusted EBITDA in any prior
period) and (b) increases in unbilled service receivables, and
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(3) increased or decreased (without duplication) to eliminate the following items reflected in
Consolidated Net Income:
(a) any unrealized net gain or loss resulting in such period from Hedging
Obligations and the application of Statement of Financial Accounting Standards No.
133;
(b) any net gain or loss resulting in such period from currency translation
gains or losses related to currency remeasurements of Indebtedness; and
(c) effects of adjustments (including the effects of such adjustments pushed
down to the Company and its Restricted Subsidiaries) in any line item in such
Person’s consolidated financial statements pursuant to GAAP resulting from the
application of purchase accounting in relation to any completed acquisition;
provided however, that Consolidated Adjusted EBITDA (except for the purposes of Section
4.04(a)(4)(c)(i)) will exclude the Consolidated Adjusted EBITDA attributable to any Excluded
Project Subsidiaries to the extent that the declaration or payment of dividends or similar
distributions by the Excluded Project Subsidiaries of that Consolidated Adjusted EBITDA is not, as
a result of an Excluded Project Subsidiary Debt Default, then permitted by operation of the terms
of the relevant Excluded Project Subsidiary Debt Agreement (provided that the Consolidated Adjusted
EBITDA of the Excluded Project Subsidiary will only be so excluded for that portion of the period
during which the condition described in the preceding proviso has occurred and is continuing).
Notwithstanding the foregoing, clauses (1)(b) through (h) of this definition relating to
amounts of a Restricted Subsidiary of a Person will be added to Consolidated Net Income to compute
Consolidated Adjusted EBITDA of such Person only to the extent (and in the same proportion) that
the net income (loss) of such Restricted Subsidiary was included in calculating the Consolidated
Net Income of such Person and, to the extent the amounts set forth in clauses (1)(b) through (h) of
this definition are in excess of those necessary to offset a net loss of such Restricted Subsidiary
or if such Restricted Subsidiary has net income for such period included in Consolidated Net
Income, only if a corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior approval (that has not been
obtained), pursuant to the terms of its charter and all agreements, instruments, judgments,
decrees, orders, statutes, rules and governmental regulations applicable to that Restricted
Subsidiary or its stockholders.
“Consolidated Coverage Ratio” means as of any date of determination the ratio of (x) the
aggregate amount of Consolidated Adjusted EBITDA of the Company and its Restricted Subsidiaries
(excluding Consolidated Adjusted EBITDA of any Excluded Project Subsidiary in the Development
Stage) for the period of the most recent four consecutive fiscal quarters ending prior to the date
of such determination for which financial statements prepared on a consolidated basis in accordance
with GAAP are available to (y) Consolidated Interest Expense of the Company and its Restricted
Subsidiaries (excluding Consolidated Interest
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Expense of any Excluded Project Subsidiary in the Development Stage) for such four fiscal
quarters, provided, however, that:
(1) if the Company or any Restricted Subsidiary:
(a) has Incurred any Indebtedness since the beginning of such period that
remains outstanding on such date of determination or if the transaction giving rise
to the need to calculate the Consolidated Coverage Ratio includes an Incurrence of
Indebtedness, Consolidated Adjusted EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day of such
period (except that in making such computation, the amount of Indebtedness under any
revolving Debt Facility outstanding on the date of such calculation will be deemed
to be (i) the average daily balance of such Indebtedness during such four fiscal
quarters or such shorter period for which such facility was outstanding or (ii) if
such facility was created after the end of such four fiscal quarters, the average
daily balance of such Indebtedness during the period from the date of creation of
such facility to the date of such calculation) and the discharge of any other
Indebtedness repaid, repurchased, redeemed, retired, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period; or
(b) has repaid, repurchased, redeemed, retired, defeased or otherwise
discharged any Indebtedness since the beginning of the period that is no longer
outstanding on such date of determination or if the transaction giving rise to the
need to calculate the Consolidated Coverage Ratio includes a discharge of
Indebtedness (in each case, other than Indebtedness Incurred under any revolving
Debt Facility unless such Indebtedness has been permanently repaid and the related
commitment terminated and not replaced), Consolidated Adjusted EBITDA and
Consolidated Interest Expense for such period shall be calculated after giving
effect on a pro forma basis to such discharge of such Indebtedness, including with
the proceeds of such new Indebtedness, as if such discharge had occurred on the
first day of such period;
(2) if since the beginning of such period, the Company or any Restricted Subsidiary shall have
made any Asset Disposition or disposed of or discontinued (as defined under GAAP) any company,
division, operating unit, segment, business, group of related assets or line of business or if the
transaction giving rise to the need to calculate the Consolidated Coverage Ratio includes such a
transaction:
(a) the Consolidated Adjusted EBITDA for such period shall be reduced by an
amount equal to the Consolidated Adjusted EBITDA (if positive) directly attributable
to the assets that are the subject of such disposition or discontinuation for such
period or increased by an amount equal to the Consolidated Adjusted EBITDA (if
negative) directly attributable thereto for such period; and
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(b) Consolidated Interest Expense for such period shall be reduced by an amount
equal to the Consolidated Interest Expense directly attributable to any Indebtedness
of the Company or any Restricted Subsidiary repaid, repurchased, redeemed, retired,
defeased or otherwise discharged (to the extent the related commitment is
permanently reduced) with respect to the Company and its continuing Restricted
Subsidiaries in connection with such transaction for such period (or, if the Capital
Stock of any Restricted Subsidiary is sold, the Consolidated Interest Expense for
such period directly attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Restricted Subsidiaries are no longer
liable for such Indebtedness after such sale);
(3) if since the beginning of such period the Company or any Restricted Subsidiary (by merger
or otherwise) (a) shall have made an Investment in any Restricted Subsidiary (or any Person that
becomes a Restricted Subsidiary or is merged with or into the Company or a Restricted Subsidiary)
or (b) an acquisition of assets, including any acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder, which constitutes all or substantially all
of a company, division, operating unit, segment, business, group of related assets or line of
business, Consolidated Adjusted EBITDA and Consolidated Interest Expense for such period will be
calculated after giving pro forma effect thereto (including the Incurrence of any Indebtedness) as
if such Investment or acquisition occurred on the first day of such period; and
(4) if since the beginning of such period any Person (that subsequently became a Restricted
Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning
of such period) shall have Incurred any Indebtedness or discharged any Indebtedness, made any
disposition or any Investment or acquisition of assets that would have required an adjustment
pursuant to clause (1), (2) or (3) above if made by the Company or a Restricted Subsidiary during
such period, Consolidated Adjusted EBITDA and Consolidated Interest Expense for such period shall
be calculated after giving pro forma effect thereto as if such transaction occurred on the first
day of such period.
For purposes of this definition, whenever pro forma effect is to be given to any calculation
under this definition, the pro forma calculations will be determined in good faith by a responsible
financial or accounting officer of the Company (including pro forma expense and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act). If any
Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest
expense on such Indebtedness will be calculated as if the rate in effect on the date of
determination had been the applicable rate for the entire period (taking into account any Interest
Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement has a remaining term
in excess of 12 months). If any Indebtedness that is being given pro forma effect bears an
interest rate at the option of the Company, the interest rate shall be calculated by applying such
optional rate chosen by the Company.
“Consolidated Income Taxes” means, with respect to any Person for any period, taxes imposed
upon such Person or other payments required to be made by such Person by any governmental authority
which taxes or other payments are calculated by reference to the income
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or profits or capital of such Person or such Person and its Restricted Subsidiaries (to the
extent such income or profits were included in computing Consolidated Net Income for such period),
including, without limitation, state, franchise and similar taxes and foreign withholding taxes
regardless of whether such taxes or payments are required to be remitted to any governmental
authority.
“Consolidated Indebtedness” means, with respect to any Person as of any date of determination,
the sum, without duplication, of:
(1) the total amount of Indebtedness of the Person and its Restricted Subsidiaries (other
than Indebtedness consisting of Hedging Obligations Incurred in the ordinary course of business and
not for speculative purposes); plus
(2) the total amount of Indebtedness of any other Person, to the extent that the same has
been guaranteed by the referent Person or one or more of its Restricted Subsidiaries (other than
Indebtedness consisting of Hedging Obligations Incurred in the ordinary course of business and not
for speculative purposes); plus
(3) the aggregate liquidation value of all Disqualified Stock of the Person and all
preferred stock of Restricted Subsidiaries of the Person;
in each case, determined on a consolidated basis in accordance with GAAP.
“Consolidated Interest Expense” means, with respect to any Person for any period, the total
interest expense of such Person, whether paid or accrued, minus interest income actually received
in cash on a consolidated basis during the applicable period on cash balances of such Person, plus,
to the extent not included in such interest expense:
(1) interest expense attributable to Capitalized Lease Obligations and the interest
portion of rent expense associated with Attributable Indebtedness in respect of the relevant lease
giving rise thereto, determined as if such lease were a capitalized lease in accordance with GAAP
and the interest component of any deferred payment obligations;
(2) amortization of debt discount (including the amortization of original issue discount
resulting from the issuance of Indebtedness at less than par) and debt issuance cost; provided,
however, that any amortization of bond premium will be credited to reduce Consolidated Interest
Expense unless, pursuant to GAAP, such amortization of bond premium has otherwise reduced
Consolidated Interest Expense;
(3) non-cash interest expense, but any non-cash interest income or expense attributable to
the movement in the mark to market valuation of Hedging Obligations or other derivative instruments
pursuant to GAAP shall be excluded from the calculation of Consolidated Interest Expense;
(4) commissions, discounts and other fees and charges owed with respect to letters of
credit and bankers’ acceptance financing;
(5) interest actually paid by the Company or any such Restricted Subsidiary under any
Guarantee of Indebtedness or other obligation of any other Person;
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(6) costs associated with entering into Hedging Obligations (including amortization of
fees) related to Indebtedness;
(7) interest expense of such Person and its Restricted Subsidiaries that was capitalized
during such period;
(8) the product of (a) all dividends paid or payable, in cash, Cash Equivalents or
Indebtedness or accrued during such period on any series of Disqualified Stock of such Person or on
Preferred Stock of its Restricted Subsidiaries payable to a party other than the Company or a
Wholly Owned Subsidiary, times (b) a fraction, the numerator of which is one and the denominator of
which is one minus the then current combined federal, state, provincial and local statutory tax
rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in
accordance with GAAP; and
(9) the cash contributions to any employee stock ownership plan or similar trust to the
extent such contributions are used by such plan or trust to pay interest or fees to any Person
(other than the Company and its Restricted Subsidiaries) in connection with Indebtedness Incurred
by such plan or trust.
For the purpose of calculating the Consolidated Coverage Ratio, the calculation of
Consolidated Interest Expense shall include all interest expense (including any amounts described
in clauses (1) through (9) above) relating to any Indebtedness of the Company or any Restricted
Subsidiary described in the final paragraph of the definition of “Indebtedness.”
For the purpose of calculating the Consolidated Coverage Ratio, Consolidated Interest Expense
shall exclude the Consolidated Interest Expense attributable to any Excluded Project Subsidiary to
the extent that the declaration or payment of dividends or similar distributions by such Excluded
Project Subsidiary of Consolidated Adjusted EBITDA is not, as a result of an Excluded Project
Subsidiary Debt Default, then permitted by operation of the terms of the relevant Excluded Project
Subsidiary Debt Agreement (provided that the Consolidated Interest Expense of the Excluded Project
Subsidiary shall only be so excluded for that portion of the period during which the condition
described in the preceding proviso has occurred and is continuing).
For the purpose of (i) calculating the Consolidated Coverage Ratio and (ii) Section 4.04, the
calculation of Consolidated Interest Expense shall exclude (i) non-cash interest attributable to
the amortization of discounts recorded in connection with the bifurcation of debt between liability
components and equity components in accordance with the Accounting Standards Codification (“ASC”)
470, Debt or ASC 815, Derivatives and Hedging and (ii) amortization of debt issuance cost.
For purposes of the foregoing, total interest expense shall be determined (i) after giving
effect to any net payments made or received by the Company and its Subsidiaries with respect to
Interest Rate Agreements and (ii) exclusive of amounts classified as other comprehensive income in
the balance sheet of the Company. Notwithstanding anything to the contrary contained herein,
without duplication of clause (9) above, commissions, discounts, yield and other fees and charges
Incurred in connection with any transaction pursuant to which the
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Company or its Restricted Subsidiaries may sell, convey or otherwise transfer or grant a
security interest in any accounts receivable or related assets shall be included in Consolidated
Interest Expense.
“Consolidated Net Income” means, with respect to any Person for any period, the net income
(loss) of such Person determined on a consolidated basis in accordance with GAAP; provided,
however, that there will not be included in such Consolidated Net Income on an after-tax basis:
(1) any net income (loss) of any Person if such Person is not a Restricted Subsidiary or
that is accounted for by the equity method of accounting, except that:
(a) subject to the limitations contained in clauses (3) through (7) below,
the Company’s equity in the net income of any such Person for such period shall be
included in such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a dividend
or other distribution to a Restricted Subsidiary, to the limitations contained in
clause (2) below); and
(b) the Company’s equity in a net loss of any such Person (other than an
Unrestricted Subsidiary) for such period shall be included in determining such
Consolidated Net Income to the extent such loss has been funded with cash from the
Company or a Restricted Subsidiary;
(2) solely for the purpose of determining Consolidated Adjusted EBITDA to determine the
amount available for Restricted Payments under Section 4.04(a)(4)(c)(i), any net income (but not
loss) of any Restricted Subsidiary (other than any Excluded Project Subsidiary) if such Restricted
Subsidiary is subject to prior government approval or other restrictions due to the operation of
its charter or any agreement, instrument, judgment, decree, order statute, rule or government
regulation (which have not been waived), directly or indirectly, on the payment of dividends or the
making of distributions by such Restricted Subsidiary, directly or indirectly, to the Company,
except that:
(a) subject to the limitations contained in clauses (3) through (7) below,
the Company’s equity in the net income of any such Restricted Subsidiary for such
period shall be included in such Consolidated Net Income up to the aggregate amount
of cash that could have been distributed by such Restricted Subsidiary during such
period to the Company or another Restricted Subsidiary as a dividend (subject, in
the case of a dividend to another Restricted Subsidiary, to the limitation contained
in this clause); and
(b) the Company’s equity in a net loss of any such Restricted Subsidiary
for such period will be included in determining such Consolidated Net Income;
(3) any gain or loss (less all fees and expenses relating thereto) realized upon sales or
other dispositions of any assets of the Company or such Restricted Subsidiary, other than
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in the ordinary course of business, as determined in good faith by the Board of Directors or
Senior Management of the Company;
(4) any after-tax effect of income (loss) from the early extinguishment of Indebtedness or
Hedging Obligations or other derivative instruments;
(5) any extraordinary gain or loss;
(6) any net income (loss) included in the consolidated statement of operations due to the
application of Financial Accounting Standard No. 160 “Noncontrolling Interests in Consolidated
Financial Statements;” and
(7) the cumulative effect of a change in accounting principles.
“Construction Capital Expenditures” means capital expenditures incurred by (i) an Excluded
Project Subsidiary for the purpose of developing or constructing a new Project or making additions
or improvements to an existing Project or (ii) by any other Restricted Subsidiary for the purpose
of making additions or improvements to an existing Project.
“Continuing Directors” means, as of any date of determination, any member of the Board of
Directors of the Company who: (1) was a member of such Board of Directors on the Issue Date; or (2)
was nominated for election or elected to such Board of Directors with the approval of a majority of
the Continuing Directors who were members of the relevant Board at the time of such nomination or
election.
“Convertible Debentures” means the Company’s existing 1.00% Senior Convertible Debentures due
2027.
“Currency Agreement” means in respect of a Person any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar agreement as to which
such Person is a party or a beneficiary.
“Debt Facility” means, with respect to the Company or any Restricted Subsidiary, one or more
debt facilities (including, without limitation, the Senior Credit Facility) or commercial paper
facilities with banks or other institutional lenders providing for revolving credit loans, term
loans, receivables financing (including through the sale of receivables to such lenders or to
special purpose entities formed to borrow from such lenders against such receivables) or letters of
credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced
(including by means of sales of debt securities to institutional investors) in whole or in part
from time to time (and whether or not with the original administrative agent and lenders or another
administrative agent or agents or other lenders and whether provided under the Senior Credit
Facility or any other credit or other agreement or indenture).
“Default” means any event that is, or after notice or passage of time or both would be, an
Event of Default.
“Designated Noncash Consideration” means the Fair Market Value of noncash consideration
received by the Company or one of its Restricted Subsidiaries in connection with
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an Asset Disposition that is so designated as Designated Noncash Consideration pursuant to an
Officers’ Certificate setting forth the basis of such valuation, less the amount of cash or Cash
Equivalents received in connection with a subsequent sale, redemption or payment of, on or with
respect to such Designated Noncash Consideration.
“Development Stage” means, with respect to any Excluded Project Subsidiary the period prior to
the first anniversary of the commencement of its commercial operations.
“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person that
by its terms (or by the terms of any security into which it is convertible or for which it is
exchangeable) or upon the happening of any event:
(1) matures or is mandatorily redeemable pursuant to a sinking fund obligation or
otherwise;
(2) is convertible into or exchangeable for Indebtedness or Disqualified Stock (excluding
Capital Stock which is convertible or exchangeable solely at the option of the Company or a
Restricted Subsidiary (it being understood that upon such conversion or exchange it shall be an
Incurrence of such Indebtedness or Disqualified Stock)); or
(3) is redeemable at the option of the holder of the Capital Stock in whole or in part,
in each case on or prior to the date 91 days after the earlier of the final maturity date of the
Notes or the date the Notes are no longer outstanding; provided, however, that only the portion of
Capital Stock which so matures or is mandatorily redeemable, is so convertible or exchangeable or
is so redeemable at the option of the holder thereof prior to such date will be deemed to be
Disqualified Stock; provided, further that any Capital Stock that would constitute Disqualified
Stock solely because the holders thereof have the right to require the Company or its Restricted
Subsidiaries to repurchase such Capital Stock upon the occurrence of a Change of Control or Asset
Disposition (each defined in a substantially identical manner to the corresponding definitions in
this Second Supplemental Indenture) shall not constitute Disqualified Stock if the terms of such
Capital Stock (and all such securities into which it is convertible or exchangeable or for which it
is redeemable) provide that the Company or its Restricted Subsidiaries, as applicable, is not
required to repurchase or redeem any such Capital Stock (and all such securities into which it is
convertible or exchangeable or for which it is redeemable) pursuant to such provision prior to
compliance by the Company with Section 4.07 and Section 4.08 and such repurchase or redemption
complies with Section 4.04.
“Domestic Subsidiary” means with respect to any Person, any Restricted Subsidiary of such
Person that is organized or existing under the laws of the United States of America, or any state
thereof, or the District of Columbia.
“Equity Offering” means a public offering for cash by the Company of its Common Stock, or
options, warrants or rights with respect to its Common Stock, other than (x) public offerings with
respect to the Company’s Common Stock, or options, warrants or rights, registered on Form S-4 or
S-8, (y) an issuance to any Subsidiary or (z) any offering of Common Stock issued in connection
with a transaction that constitutes a Change of Control.
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“Event of Default” has the meaning set forth in Section 6.01.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.
“Excluded Project Subsidiary” means, at any time, any Restricted Subsidiary that (i) becomes a
Restricted Subsidiary of the Company after the Issue Date or is in its Development Stage as of the
Issue Date and is an obligor or otherwise bound with respect to Indebtedness that constitutes
Non-Recourse Debt and that is not an obligor with respect to any other Indebtedness, and (ii) has
been designated by a certificate executed by a Responsible Officer of the Company as an Excluded
Project Subsidiary dedicated to the operation of one or more Projects that has been and is to be
financed only with equity contributions in cash and Non-Recourse Debt (and not any other
Indebtedness).
The Board of Directors or Senior Management of the Company may designate any Restricted
Subsidiary that complies with the requirements above to be an Excluded Project Subsidiary. The
Board of Directors or Senior Management may designate any Excluded Project Subsidiary to be a
Restricted Subsidiary that is not an Excluded Project Subsidiary, provided that if any existing
Non-Recourse Debt of such Excluded Project Subsidiary ceases to constitute Non-Recourse Debt upon
such designation or thereafter, such Indebtedness will be deemed Incurred at the time it ceases to
be Non-Recourse Debt.
“Excluded Project Subsidiary Debt Agreement” means the agreement or documents governing the
relevant Indebtedness referred to in the definition of “Excluded Project Subsidiary Debt Default.”
“Excluded Project Subsidiary Debt Default” means, with respect to any Excluded Project
Subsidiary, the failure of such Excluded Project Subsidiary to pay any principal or interest or
other amounts due in respect of any Indebtedness, when and as the same shall become due and
payable, or the occurrence of any other event or condition that results in any Indebtedness of such
Excluded Project Subsidiary becoming due prior to its scheduled maturity or that enables or permits
(with or without the giving of notice, lapse of time or both) the holder or holders of such
Indebtedness or any trustee or agent on its or their behalf to cause such Indebtedness to become
due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its
scheduled maturity.
“Fair Market Value” means, with respect to any asset or liability, the fair market value of
such asset or liability as determined by Senior Management of the Company in good faith; provided
that if the fair market value exceeds $25.0 million, such determination shall be made by the Board
of Directors of the Company or an authorized committee thereof in good faith (including as to the
value of all non-cash assets and liabilities).
“Foreign Subsidiary” means any Restricted Subsidiary that is not organized under the laws of
the United States of America or any state thereof or the District of Columbia and any Restricted
Subsidiary of such Restricted Subsidiary.
“GAAP” means generally accepted accounting principles in the United States of America as in
effect as of the Issue Date, including those set forth in the opinions and
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pronouncements of the Accounting Principles Board of the American Institute of Certified
Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or
in such other statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in the Indenture will be
computed in conformity with GAAP, except that in the event the Company is acquired in a transaction
that is accounted for using purchase accounting, the effects of the application of purchase
accounting shall be disregarded in the calculation of such ratios and other computations contained
in the Indenture.
“Government Securities” means securities that are (a) direct obligations of the United States
of America for the timely payment of which its full faith and credit is pledged or (b) obligations
of a Person controlled or supervised by and acting as an agency or instrumentality of the United
States of America the timely payment of which is unconditionally Guaranteed as a full faith and
credit obligation of the United States of America, which, in either case, are not callable or
redeemable at the option of the issuer thereof, and shall also include a depositary receipt issued
by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any
such Government Securities or a specific payment of principal of or interest on any such Government
Securities held by such custodian for the account of the holder of such depositary receipt;
provided that (except as required by law) such custodian is not authorized to make any deduction
from the amount payable to the holder of such depositary receipt from any amount received by the
custodian in respect of the Government Securities or the specific payment of principal of or
interest on the U.S. Government Securities evidenced by such depositary receipt.
“Guarantee” means any obligation, contingent or otherwise, of any Person directly or
indirectly Guaranteeing any Indebtedness of any other Person and any obligation, direct or
indirect, contingent or otherwise, of such Person:
(1) to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by
agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement conditions or otherwise); or
(2) entered into for purposes of assuring in any other manner the obligee of such
Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided, however, that the term “Guarantee” will not include endorsements for
collection or deposit in the ordinary course of business.
“Hedging Obligations” of any Person means the obligations of such Person pursuant to any
Interest Rate Agreement, Currency Agreement or Commodity Agreement.
“Holder” means a Person in whose name a Note is registered on the Registrar’s books.
“Incur” means issue, create, assume, Guarantee, incur or otherwise become liable for;
provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such
Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or
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otherwise) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes
a Restricted Subsidiary; and the terms “Incurred” and “Incurrence” have meanings correlative to the
foregoing.
“Indebtedness” means, with respect to any Person on any date of determination (without
duplication):
(1) the principal of and premium (if any) in respect of indebtedness of such Person for
borrowed money;
(2) the principal of and premium (if any) in respect of obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments;
(3) the principal component of all obligations of such Person in respect of letters of
credit, bankers’ acceptances or other similar instruments (including reimbursement obligations with
respect thereto except to the extent such reimbursement obligation relates to a trade payable and
such obligation is satisfied within 30 days of Incurrence);
(4) the principal component of all obligations of such Person to pay the deferred and
unpaid purchase price of property (including earn-out obligations), which purchase price is due
after the date of placing such property in service or taking delivery and title thereto, except (i)
any such balance that constitutes a trade payable or similar obligation to a trade creditor, in
each case accrued in the ordinary course of business and (ii) any earn-out obligation until the
amount of such obligation becomes a liability on the balance sheet of such Person in accordance
with GAAP;
(5) Capitalized Lease Obligations and all Attributable Indebtedness of such Person
(whether or not such items would appear on the balance sheet of the obligor);
(6) the principal component or liquidation preference of all obligations of such Person
with respect to the redemption, repayment or other repurchase of any Disqualified Stock or, with
respect to any Restricted Subsidiary, any Preferred Stock (but excluding, in each case, any accrued
dividends);
(7) the principal component of all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such Person; provided,
however, that the amount of such Indebtedness will be the lesser of (a) the fair market value of
such asset at such date of determination and (b) the amount of such Indebtedness of such other
Persons;
(8) the principal component of Indebtedness of other Persons to the extent Guaranteed by
such Person (whether or not such items would appear on the balance sheet of the guarantor or
obligor);
(9) to the extent not otherwise included in this definition, net obligations of such
Person under Hedging Obligations (the amount of any such obligations to be equal at any time to the
termination value of such agreement or arrangement giving rise to such Obligation that would be
payable by such Person at such time); and
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(10) to the extent not otherwise included in this definition, the Receivables Transaction
Amount outstanding relating to a Qualified Receivables Transaction.
Notwithstanding the foregoing, money borrowed and set aside at the time of the Incurrence of
any Indebtedness in order to pre-fund the payment of interest on such Indebtedness shall not be
deemed to be “Indebtedness,” provided that such money is held to secure the payment of such
interest.
In addition, “Indebtedness” of any Person shall include Indebtedness described in the
preceding paragraph that would not appear as a liability on the balance sheet of such Person if:
(1) such Indebtedness is the obligation of a partnership or Joint Venture that is not a
Restricted Subsidiary;
(2) such Person or a Restricted Subsidiary of such Person is a general partner of the
partnership or has an equivalent position for the Joint Venture (a “General Partner”); and
(3) there is recourse, by contract or operation of law, with respect to the payment of
such Indebtedness to property or assets of such Person or a Restricted Subsidiary of such Person;
and then such Indebtedness shall be included in an amount not to exceed:
(a) the lesser of (i) the net assets of the General Partner and (ii) the
amount of such obligations to the extent that there is recourse, by contract or
operation of law, to the property or assets of such Person or a Restricted
Subsidiary of such Person; or
(b) if less than the amount determined pursuant to clause (a) immediately
above, the actual amount of such Indebtedness that is recourse to such Person or a
Restricted Subsidiary of such Person, if the Indebtedness is evidenced by a writing
and is for a determinable amount.
“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or
consultant of nationally recognized standing that is, in the good faith judgment of the Company,
qualified to perform the task for which it has been engaged.
“Insurance Premium Financing Arrangement” means any arrangement with a Person who is not an
Affiliate of the Company pursuant to which such Person advances insurance premiums for the Company
and its Restricted Subsidiaries.
“Insurance Subsidiaries” means Covanta Insurance Holdings Corporation and its Subsidiaries.
“Interest” with respect to the Notes means interest with respect thereto.
“Interest Payment Date” has the meaning specified in Section 2.03(c).
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“Interest Rate Agreement” means, with respect to any Person any interest rate protection
agreement, interest rate future agreement, interest rate option agreement, interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge
agreement or other similar agreement or arrangement as to which such Person is party or a
beneficiary.
“Investment” means, with respect to any Person, all investments by such Person in other
Persons (including Affiliates) in the form of any direct or indirect advance, loan (other than
advances or extensions of credit to customers in the ordinary course of business) or other
extensions of credit (including by way of Guarantee or similar arrangement, but excluding any debt
or extension of credit represented by a bank deposit (other than a time deposit)) or capital
contribution to (by means of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by, such Person and all other items that
are or would be classified as investments on a balance sheet prepared in accordance with GAAP;
provided that none of the following will be deemed to be an Investment:
(1) Hedging Obligations entered into in the ordinary course of business and in compliance
with the Indenture;
(2) endorsements of negotiable instruments and documents in the ordinary course of
business; and
(3) an acquisition of assets, Capital Stock or other securities by the Company or a
Subsidiary for consideration to the extent such consideration consists of Common Stock of the
Company.
For purposes of Section 4.04,
(1) “Investment” will include the portion (proportionate to the Company’s equity interest
in a Restricted Subsidiary that is to be designated an Unrestricted Subsidiary or an Excluded
Project Subsidiary, as applicable) of the Fair Market Value of the net assets of such Restricted
Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary or
an Excluded Project Subsidiary, as applicable; provided, however, that upon a redesignation of such
Subsidiary as a Restricted Subsidiary (other than an Excluded Project Subsidiary), the Company
shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an
amount (if positive) equal to (a) the Company’s aggregate “Investment” in such Subsidiary as of the
time of such redesignation less (b) the portion (proportionate to the Company’s equity interest in
such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time that
such Subsidiary is so re-designated a Restricted Subsidiary (other than an Excluded Project
Subsidiary);
(2) any property transferred to or from an Unrestricted Subsidiary or an Excluded Project
Subsidiary will be valued at its Fair Market Value at the time of such transfer; and
(3) if the Company or any Restricted Subsidiary sells or otherwise disposes of any Voting
Stock of any Restricted Subsidiary such that, after giving effect to any such sale or
- 22 -
disposition, such entity is no longer a Subsidiary of the Company, the Company shall be
deemed to have made an Investment on the date of any such sale or disposition equal to the Fair
Market Value of the Capital Stock of such Subsidiary not sold or disposed of.
“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by
Xxxxx’x Investors Service, Inc. and BBB- (or the equivalent) by Standard & Poor’s Ratings Group,
Inc., or any equivalent rating by any Rating Agency, in each case, with a stable or better outlook.
“Issue Date” means December 1, 2010.
“Joint Venture” means a joint venture, partnership or similar arrangement, whether in
partnership or other legal form.
“Lien” means, with respect to any asset, any mortgage, lien (statutory or otherwise), pledge,
hypothecation, charge, security interest, preference, priority or encumbrance of any kind in
respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in the nature thereof,
any option or other agreement to sell or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction; provided that in no event shall an operating lease be deemed to constitute a Lien.
“Net Available Cash” from an Asset Disposition means cash payments received (including any
cash payments received by way of deferred payment of principal pursuant to a note or installment
receivable or otherwise and net proceeds from the sale or other disposition of any securities or
other assets received as consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such Asset Disposition or
received in any other non-cash form) therefrom, in each case net of:
(1) all legal, accounting, investment banking, title and recording tax expenses, commissions
and other fees and expenses Incurred, and all Federal, state, provincial, foreign and local taxes
required to be paid or accrued as a liability under GAAP (after taking into account any available
tax credits or deductions and any tax sharing agreements), as a consequence of such Asset
Disposition;
(2) all payments made on any Indebtedness that is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon such assets, or which must by its terms,
or in order to obtain a necessary consent to such Asset Disposition, or by applicable law be repaid
out of the proceeds from such Asset Disposition;
(3) all distributions and other payments required to be made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset Disposition; and
(4) the deduction of appropriate amounts to be provided by the seller as a reserve, in
accordance with GAAP, against any liabilities associated with the assets disposed of
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in such Asset Disposition and retained by the Company or any Restricted Subsidiary after such
Asset Disposition.
“Net Cash Proceeds,” with respect to any issuance or sale of Capital Stock, means the cash
proceeds of such issuance or sale, net of attorneys’ fees, accountants’ fees, underwriters’ or
placement agents’ fees, listing fees, discounts or commissions and brokerage, consultant and other
fees and charges actually incurred in connection with such issuance or sale and net of taxes paid
or payable as a result of such issuance or sale (after taking into account any available tax credit
or deductions and any tax sharing arrangements).
“Non-Recourse Debt” means Indebtedness of a Person:
(1) as to which neither the Company nor any Restricted Subsidiary (other than an Excluded
Project Subsidiary) (a) provides any Guarantee or credit support of any kind (including any
undertaking, Guarantee, indemnity, agreement or instrument that would constitute Indebtedness),
other than, in the case of a Excluded Project Subsidiary, pursuant to a Non-Recourse Guarantee, or
(b) is directly or indirectly liable (as a guarantor or otherwise) other than pursuant to a
Non-Recourse Guarantee or (c) constitutes the lender;
(2) no default with respect to which (including any rights that the holders thereof may have
to take enforcement action against an Unrestricted Subsidiary) would permit (upon notice, lapse of
time or both) any holder of any other Indebtedness of the Company or any Restricted Subsidiary
(other than the Notes and any Debt Facility (other than bonds, debentures, notes or any other
instruments governed by an indenture)) to declare a default under such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its Stated Maturity; and
(3) in the case of Non-Recourse Debt incurred after the Issue Date, as to which the lenders
have been notified in writing, or have otherwise agreed, that they will not have any recourse to
the stock or assets of the Company or any of its Restricted Subsidiaries except as otherwise
permitted by clause (1) above;
provided, however, that (A) the holder or obligee of any such Indebtedness may have recourse
to the assets subject to any Permitted Lien described in clause (18) of that definition, (B) the
following kinds of support relating to Indebtedness or a Person do not affect the determination of
such Indebtedness as Non-Recourse Debt: (i) Guarantees with respect to debt service reserves
established with respect to a Subsidiary to the extent that such Guarantee shall result in the
immediate payment of funds, pursuant to dividends or otherwise, in the amount of such Guarantee;
(ii) contingent obligations of the Company or any other Subsidiary to make capital contributions to
a Subsidiary; (iii) any credit support or liability consisting of reimbursement obligations in
respect of letters of credit issued under and subject to the terms of, the Senior Credit Facility
to support obligations of a Subsidiary; (iv) agreements of the Company or any Subsidiary to
provide, or guarantees or other credit support (including letters of credit) by the Company or any
Subsidiary with respect to the performance and payment obligations under of any agreement of
another Subsidiary to provide, corporate, management, marketing, administrative, technical, energy
management or marketing, engineering, procurement, construction, operation and/or maintenance
services to such Subsidiary, including in respect of
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the sale or acquisition of power, emissions, fuel, oil, gas or other supply of energy; (v) any
Hedging Obligations and any power purchase or sale agreements, fuel purchase or sale agreements,
emissions credit purchase or sale agreements, commercial or trading agreements and any other
similar agreements entered into between the Company or any Subsidiary with or otherwise involving
any other Subsidiary, including any guarantees or other credit support (including letters of
credit) of obligations of a Subsidiary under such agreements in the ordinary course of business;
and (vi) any Investments in a Subsidiary, to the extent such kinds of support are customary and
entered into in the ordinary course of business and are unsecured and otherwise permitted by this
Second Supplemental Indenture; and (C) any provision substantially similar to (a) Section 6.01(6)
contained in any bonds, debentures or notes or (b) Section 8.1(b) of the Senior Credit Facility, as
such provision is in effect on the Issue Date, contained in any Debt Facility other than bonds,
debentures, notes or any other instruments governed by an indenture, do not affect the
determination of such Indebtedness as Non-Recourse Debt.
“Non-Recourse Guarantee” means any Guarantee that is customary and entered into in the
ordinary course of business by the Company or a Restricted Subsidiary of Non-Recourse Debt incurred
by an Excluded Project Subsidiary as to which the lenders of such Non-Recourse Debt will not have
any recourse to the stock or assets of the Company, except to the limited extent set forth in such
guarantee with respect to the Company’s obligation to make equity contributions.
“Obligations” means any principal, interest (including any interest accruing subsequent to the
filing of a petition in bankruptcy, reorganization or similar proceeding at the rate provided for
in the documentation with respect thereto, whether or not such interest is an allowed claim under
applicable state, federal or foreign law), other monetary obligations, penalties, fees,
indemnifications, reimbursements (including reimbursement obligations with respect to letters of
credit and banker’s acceptances), damages and other liabilities, and Guarantees of payment of such
principal, interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities, payable under the documentation governing any Indebtedness.
“Officer” means the Chairman of the Board, the Chief Executive Officer, the President, the
Chief Financial Officer, any Executive Vice President, Senior Vice President or Vice President, the
Treasurer or the Secretary of the Company or, in the event that the Company is a partnership or a
limited liability company that has no such officers, a person duly authorized under applicable law
by the general partner, managers, members or a similar body to act on behalf of the Company.
“Officers’ Certificate” means a certificate signed by two Officers of the Company, one of whom
is the principal executive officer, the principal financial officer or the principal accounting
officer or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the
Company.
“Opinion of Counsel” means a written opinion from legal counsel who is acceptable to the
Trustee. The counsel may be an employee of or counsel to the Company or the Trustee.
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“Pari Passu Indebtedness” means Indebtedness that ranks equally in right of payment to the
Notes (without giving effect to collateral arrangements).
“Permitted Investment” means an Investment by the Company or any Restricted Subsidiary in:
(1) a Restricted Subsidiary (other than an Excluded Project Subsidiary or a Receivables
Entity);
(2) any Investment by the Company or any of its Restricted Subsidiaries in a Person that is
engaged in a Similar Business if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary; or
(b) such Person, in one transaction or a series of related transactions, is
merged or consolidated with or into, or transfers or conveys substantially all of
its assets to, or is liquidated into, the Company or a Restricted Subsidiary,
and, in each case, any Investment held by such Person; provided, that such Investment was not
acquired by such Person in contemplation of such acquisition, merger, consolidation or transfer;
(3) cash and Cash Equivalents (and, in the case of Excluded Project Subsidiaries only, Cash
Equivalents or other liquid investments permitted under any Debt Facility to which it is a party)
and, to the extent made in connection therewith, Investments permitted or imposed under the terms
of any cash collateral or debt service reserve agreement permitted hereunder;
(4) receivables owing to the Company or any Restricted Subsidiary created or acquired in the
ordinary course of business and payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary trade terms as the Company
or any such Restricted Subsidiary deems reasonable under the circumstances;
(5) payroll, travel and similar advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for accounting purposes and that are made in the
ordinary course of business;
(6) loans or advances to employees, Officers or directors of the Company or any Restricted
Subsidiary in the ordinary course of business in an aggregate amount not in excess of $10.0 million
with respect to all loans or advances made since the Issue Date (without giving effect to the
forgiveness of any such loan);
(7) any Investment acquired by the Company or any of its Restricted Subsidiaries:
(a) in exchange for any other Investment or accounts receivable or in
cancellation of a claim held by the Company or any such Restricted Subsidiary in
- 26 -
connection with or as a result of or to avoid a bankruptcy, workout,
reorganization or recapitalization of the issuer of such other Investment or
accounts receivable; or
(b) as a result of a foreclosure by the Company or any of its Restricted
Subsidiaries with respect to any secured Investment or other transfer of title with
respect to any secured Investment in default;
(8) Investments made as a result of the receipt of non-cash consideration from an Asset
Disposition that was made pursuant to and in compliance with Section 4.08 or any other disposition
of assets not constituting an Asset Disposition;
(9) Investments in existence on the Issue Date;
(10) Currency Agreements, Interest Rate Agreements, Commodity Agreements and related Hedging
Obligations, which transactions or obligations are Incurred in compliance with Section 4.03;
(11) Guarantees issued in accordance with Section 4.03;
(12) Investments made in connection with the funding of contributions under any non-qualified
retirement plan or similar employee compensation plan in an amount not to exceed the amount of
compensation expense recognized by the Company and its Restricted Subsidiaries in connection with
such plans;
(13) Investments in any Permitted Joint Ventures for an aggregate amount not to exceed the
greater of (x) $200.0 million or (y) 5% of Total Tangible Assets;
(14) Deposits of cash made in the ordinary course of business to secure performance of
operating leases;
(15) Investments in Unrestricted Subsidiaries not to exceed $5.0 million in the aggregate;
(16) Investments in the Insurance Subsidiaries to allow for the redemption or repurchase of
Disqualified Stock of any Insurance Subsidiary not to exceed $5.0 million in the aggregate;
(17) Investments made pursuant to binding commitments that, at the time such binding
commitments were entered into, would have complied with the provisions of the Indenture;
(18) Investments constituting deposits, prepayments and other credits to suppliers made in the
ordinary course of business consistent with past practices;
(19) Investments by the Company or a Restricted Subsidiary in a Receivables Entity or any
Investment by a Receivables Entity in any other Person, in each case, in connection with a
Qualified Receivables Transaction, provided, however, that any Investment in any such
- 27 -
Person is in the form of a Purchase Money Note, or any equity interest or interests in
Receivables and related assets generated by the Company or a Restricted Subsidiary and transferred
to any Person in connection with a Qualified Receivables Transaction or any such Person owning such
Receivables;
(20) Investments in any Excluded Project Subsidiary; provided such Investments are made in
cash; and
(21) Investments by the Company or any of its Restricted Subsidiaries, together with all other
Investments pursuant to this clause (21), in an aggregate amount at the time of such Investment not
to exceed $100.0 million outstanding at any one time (with the fair market value of such Investment
being measured at the time made and without giving effect to subsequent changes in value).
“Permitted Joint Venture” means any Joint Ventures entered into by the Company or any of its
Restricted Subsidiaries in the ordinary course of business for the purpose to conducting a Similar
Business.
“Permitted Liens” means, with respect to any Person:
(1) Liens securing Indebtedness and other obligations under the Senior Credit Facility and
related Hedging Obligations and related banking services or cash management obligations and Liens
on assets of Restricted Subsidiaries securing Guarantees of Indebtedness and other obligations of
the Company under the Senior Credit Facility permitted to be Incurred under Section 4.03(b)(1);
(2) pledges or deposits by such Person under workers’ compensation laws, unemployment
insurance laws or similar legislation, or good faith deposits in connection with bids, tenders,
stationary obligations, performance, contracts (other than for the payment of Indebtedness) or
leases to which such Person is a party, or deposits to secure public or statutory obligations of
such Person or deposits of cash or United States government bonds to secure surety, appeal bonds,
leases, government contracts, trade contracts, performance or return-of-money bonds and other
similar obligation to which such Person is a party, or deposits as security for contested taxes or
import or customs duties or for the payment of rent, in each case Incurred in the ordinary course
of business or Liens in favor of customs or revenue authorities arising as a matters of law to
secure payments or customs duties in connection with the importation of goods;
(3) Liens imposed by law, including carriers’, warehousemen’s, mechanics’, materialmen’s and
repairmen’s Liens, Incurred in the ordinary course of business;
(4) Liens for taxes, assessments or other governmental charges not yet subject to penalties
for non-payment or that are being contested in good faith by appropriate proceedings provided
appropriate reserves required pursuant to GAAP have been made in respect thereof;
(5) Liens in favor of issuers of surety or performance bonds or letters of credit or bankers’
acceptances or similar obligations issued pursuant to the request of and for the account of such
Person in the ordinary course of its business; provided, however, that such letters of credit do
not constitute Indebtedness;
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(6) encumbrances, ground leases, easements or reservations of, or rights of others for,
licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning, building codes or other restrictions (including, without limitation, minor
defects or irregularities in title and similar encumbrances) as to the use of real properties or
Liens incidental to the conduct of the business of such Person or to the ownership of its
properties (x) that do not in the aggregate materially adversely affect the value of said
properties or materially impair their use in the operation of the business of such Person or (y)
are in the ordinary conduct of business of the Company or Restricted Subsidiary as applicable;
(7) Liens securing Hedging Obligations so long as the related Indebtedness is, and is
permitted to be under the Indenture, secured by a Lien on the same property securing such Hedging
Obligation;
(8) leases, licenses, subleases and sublicenses of assets (including, without limitation, real
property and intellectual property rights) that do not materially interfere with the ordinary
conduct of the business of the Company or any of its Restricted Subsidiaries;
(9) judgment Liens not giving rise to an Event of Default so long as such Lien is adequately
bonded and any appropriate legal proceedings which may have been duly initiated for the review of
such judgment have not been finally terminated or the period within which such proceedings may be
initiated has not expired;
(10) Liens for the purpose of securing the payment of all or a part of the purchase price of,
or Capitalized Lease Obligations, mortgage financings, purchase money obligations or other payments
Incurred to finance assets or property (other than Capital Stock or other Investments) acquired,
constructed, improved or leased in the ordinary course of business; provided that:
(a) the aggregate principal amount of Indebtedness secured by such Liens is
otherwise permitted to be Incurred under the Indenture and does not exceed the cost
of the assets or property so acquired, constructed or improved; and
(b) such Liens are created within 180 days of construction, acquisition or
improvement of such assets or property and do not encumber any other assets or
property of the Company or any Restricted Subsidiary other than such assets or
property and assets affixed or appurtenant thereto;
(11) Liens arising solely by virtue of any statutory or common law provisions relating to
banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts or other
funds maintained with a depositary institution; provided that:
(a) such deposit account is not a dedicated cash collateral account and is not
subject to restrictions against access by the Company in excess of those set forth
by regulations promulgated by the Federal Reserve Board; and
(b) such deposit account is not intended by the Company or any Restricted
Subsidiary to provide collateral to the depository institution;
- 29 -
(12) Liens arising from Uniform Commercial Code financing statement filings regarding
operating leases entered into by the Company and its Restricted Subsidiaries in the ordinary course
of business;
(13) Liens existing on the Issue Date (other than Liens permitted under clause (1));
(14) Liens on property or shares of stock of a Person at the time such Person becomes a
Restricted Subsidiary; provided, however, that such Liens are not created, Incurred or assumed in
connection with, or in contemplation of, such other Person becoming a Restricted Subsidiary;
provided further, however, that any such Lien may not extend to any other property owned by the
Company or any Restricted Subsidiary;
(15) Liens on property at the time the Company or a Restricted Subsidiary acquired the
property, including any acquisition by means of a merger or consolidation with or into the Company
or any Restricted Subsidiary; provided, however, that such Liens are not created, Incurred or
assumed in connection with, or in contemplation of, such acquisition; provided further, however,
that such Liens may not extend to any other property owned by the Company or any Restricted
Subsidiary;
(16) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to the
Company or another Restricted Subsidiary (other than a Receivables Entity);
(17) Liens securing the Notes;
(18) Liens on (i) assets of any Excluded Project Subsidiary or Capital Stock of an Excluded
Project Subsidiary securing Indebtedness and/or other obligations of such Excluded Project
Subsidiary or (ii) assets of any Restricted Subsidiary associated with any Project securing any
Non-Recourse Indebtedness incurred to finance the expansion of such Project, in each case which
Indebtedness was permitted by the terms of this Second Supplemental Indenture to be incurred;
(19) Liens securing Refinancing Indebtedness Incurred to refinance, refund, replace, amend,
extend or modify, as a whole or in part, Indebtedness that was previously so secured pursuant to
clauses (10), (13), (14), (15), (17) and (18) of this definition, provided that any such Lien is
limited to all or part of the same property or assets (plus improvements, accessions, proceeds or
dividends or distributions in respect thereof) that secured (or, under the written arrangements
under which the original Lien arose, could secure) the Indebtedness being refinanced or is in
respect of property that is the security for a Permitted Lien hereunder;
(20) any interest or title of a lessor or sublessor under any lease of real estate Capitalized
Lease Obligation or operating lease;
(21) Liens in favor of the Company or any Restricted Subsidiary;
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(22) Liens solely on any xxxx xxxxxxx money deposits made by the Company or any of its
Restricted Subsidiaries in connection with any letter of intent or purchase agreement permitted
under the Indenture;
(23) Liens created pursuant to Insurance Premium Financing Arrangements otherwise permitted
under the Indenture, so long as such Liens attach only to gross unearned premiums for the insurance
policies and related rights;
(24) Liens on assets transferred to a Receivables Entity or on assets of a Receivables Entity,
in either case Incurred in connection with a Qualified Receivables Transaction; and
(25) Liens securing Indebtedness (other than Subordinated Obligations) in an aggregate
principal amount outstanding at any one time not to exceed $100.0 million.
“Person” means any natural person, corporation, limited liability company, partnership, joint
venture, association, joint-stock company, Joint Venture, trust, unincorporated organization,
government or any agency or political subdivision hereof or any other entity, whether or not a
legal person.
“Preferred Stock,” as applied to the Capital Stock of any corporation, means Capital Stock of
any class or classes (however designated) that is preferred as to the payment of dividends upon
liquidation, dissolution or winding up.
“Project” means any energy-from-waste facility, waste disposal, treatment transfer,
transportation or collection facility and facilities and operations related or ancillary thereto,
electrical generation plant, cogeneration plant, water treatment facility, renewable energy
facility or other facility for the generation of electricity or other forms of energy or related or
ancillary assets or properties.
“Prospectus Supplement” means the Company’s prospectus supplement dated November 16, 2010
relating to the Notes.
“Purchase Money Note” means a promissory note of a Receivables Entity evidencing the deferred
purchase price of Receivables (and related assets) and/or a line of credit, which may be
irrevocable, from the Company or any Restricted Subsidiary in connection with a Qualified
Receivables Transaction with a Receivables Entity, which deferred purchase price or line is
repayable from cash available to the Receivables Entity, other than amounts required to be
established as reserves pursuant to agreements, amounts paid to investors in respect of interest,
principal and other amounts owing to such investors and amounts owing to such investors and amounts
paid in connection with the purchase of newly generated Receivables.
“Qualified Receivables Transaction” means any transaction or series of transactions that may
be entered into by the Company or any of its Restricted Subsidiaries pursuant to which the Company
or any of its Restricted Subsidiaries may sell, convey or otherwise transfer to (1) a Receivables
Entity (in the case of a transfer by the Company or any of its Restricted Subsidiaries) and (2) any
other Person (in the case of a transfer by a Receivables Entity), or may grant a security interest
in, any Receivables (whether now existing or arising in
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the future) of the Company or any of its Restricted Subsidiaries, and any assets related
thereto including, without limitation, all Interest Reserve Collateral securing such Receivables,
all contracts and all Guarantees or other obligations in respect of such accounts receivable, the
proceeds of such Receivables and other assets that are customarily transferred, or in respect of
which security interests are customarily granted, in connection with asset securitization involving
Receivables.
“Rating Agency” means each of Standard & Poor’s Ratings Group, Inc. and Xxxxx’x Investors
Service, Inc. or if Standard & Poor’s Ratings Group, Inc. or Xxxxx’x Investors Service, Inc. or
both shall not make a rating on the Notes publicly available, a nationally recognized statistical
Rating Agency or agencies, as the case may be, selected by the Company (as certified by a
resolution of the Board of Directors) which shall be substituted for Standard & Poor’s Ratings
Group, Inc. or Xxxxx’x Investors Service, Inc. or both, as the case may be.
“Receivable” means a right to receive payment arising from a sale or lease of goods or the
performance of services by a Person pursuant to an arrangement with another Person pursuant to
which such other Person is obligated to pay for goods or services under terms that permit the
purchase of such goods and services on credit and shall include, in any event, any items of
property that would be classified as an “account,” “chattel paper,” “payment intangible” or
“instrument” under the Uniform Commercial Code as in effect in the State of New York and any
“supporting obligations” as so defined.
“Receivables Entity” means a Wholly-Owned Subsidiary (or another Person in which the Company
or any Restricted Subsidiary makes an Investment and to which the Company or any Restricted
Subsidiary transfers Receivables and related assets) which engages in no activities other than in
connection with the financing of Receivables and which is designated by the Board of Directors of
the Company (as provided below) as a Receivables Entity:
(1) no portion of the Indebtedness or any other obligations (contingent or otherwise) of
which:
(a) is Guaranteed by the Company or any Restricted Subsidiary (excluding
Guarantees of obligations (other than the principal of, and interest on,
Indebtedness) pursuant to Standard Securitization Undertakings);
(b) is recourse to or obligates the Company or any Restricted Subsidiary in any
way other than pursuant to Standard Securitization Undertakings; or
(c) subjects any property or asset of the Company or any Restricted Subsidiary,
directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to Standard Securitization Undertakings;
(2) with which neither the Company nor any Restricted Subsidiary has any material contract,
agreement, arrangement or understanding (except in connection with a Purchase Money Note or
Qualified Receivables Transaction) other than on terms no less
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favorable to the Company or such Restricted Subsidiary than those that might be obtained at
the time from Persons that are not Affiliates of the Company, other than fees payable in the
ordinary course of business in connection with servicing Receivables; and
(3) to which neither the Company nor any Restricted Subsidiary has any obligation to maintain
or preserve such entity’s financial condition or cause such entity to achieve certain levels of
operating results.
Any such designation by the Board of Directors of the Company shall be evidenced to the
Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of
the Company giving effect to such designation and an Officers’ Certificate certifying that such
designation complied with the foregoing conditions.
“Receivables Fees” means any fees or interest paid to purchasers or lenders providing the
financing in connection with a Qualified Receivables Transaction, factoring agreement or other
similar agreement, including any such amounts paid by discounting the face amount of Receivables or
participations therein transferred in connection with a Qualified Receivables Transaction,
factoring agreement or other similar arrangement, regardless of whether any such transaction is
structured as on-balance sheet or off-balance sheet or through a Restricted Subsidiary or an
Unrestricted Subsidiary.
“Receivables Transaction Amount” means the amount of obligations outstanding under the legal
documents entered into as part of such Qualified Receivables Transaction on any date of
determination that would be characterized as principal if such Qualified Receivables Transaction
were structured as a secured lending transaction rather than as a purchase.
“Record Date” for the interest payable on any applicable Interest Payment Date means May 15
and November 15 immediately preceding the applicable June 1 and December 1 Interest Payment Date,
respectively.
“Redemption Date” has the meaning specified in Section 3.01.
“Refinancing Indebtedness” means Indebtedness that is Incurred to refund, refinance, replace,
exchange, renew, repay or extend (including pursuant to any defeasance or discharge mechanism)
(collectively, “refinance,” “refinances” and “refinanced” shall each have a correlative meaning)
any Indebtedness existing on the Issue Date or Incurred in compliance with the Indenture (including
Indebtedness of the Company that refinances Indebtedness of any Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary that refinances Indebtedness of another Restricted
Subsidiary) including Indebtedness that refinances Refinancing Indebtedness, provided, however,
that:
(1) (a) if the Stated Maturity of the Indebtedness being refinanced is earlier than the Stated
Maturity of the Notes, the Refinancing Indebtedness has a Stated Maturity no earlier than the
Stated Maturity of the Indebtedness being refinanced or (b) if the Stated Maturity of the
Indebtedness being refinanced is later than the Stated Maturity of the Notes, the Refinancing
Indebtedness has a Stated Maturity at least 91 days later than the Stated Maturity of the Notes;
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(2) the Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness
is Incurred that is equal to or greater than the Average Life of the Indebtedness being refinanced;
(3) such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if issued
with original issue discount, an aggregate issue price) that is equal to or less than the sum of
the aggregate principal amount (or if issued with original issue discount, the aggregate accreted
value) then outstanding of the Indebtedness being refinanced (plus, without duplication, any
additional Indebtedness Incurred to pay interest or premiums required by the instruments governing
such existing Indebtedness and fees Incurred in connection therewith);
(4) if the Indebtedness being refinanced is subordinated in right of payment to the Notes or
the Guarantee, such Refinancing Indebtedness is subordinated in right of payment to the Notes or
the Guarantee on terms at least as favorable to the Holders as those contained in the documentation
governing the Indebtedness being refinanced; and
(5) Refinancing Indebtedness shall not include Indebtedness of a Restricted Subsidiary that
refinances Indebtedness of the Company.
“Restricted Payment” has the meaning set forth in Section 4.04.
“Restricted Investment” means any Investment other than a Permitted Investment.
“Restricted Cash” means, as of any date of determination, (i) the sum of the amounts on
deposit that are designated to pay debt service principal or construction costs, as debt service
reserves, or to redeem the Indebtedness secured thereby to the extent excess proceeds remain in the
relevant account after completion of construction of a Project and held in a debt service principal
account, a debt service reserve fund or a reserve account (which such reserve account secures the
Non-Recourse Debt that is the source of the amounts therein) so long as the proceeds in such
reserve account are designated to pay construction costs or debt service during construction or, if
excess proceeds remain in such account after completion of construction of the relevant project, to
redeem the Non-Recourse Debt secured thereby and (ii) any amounts of cash pledged to collateralized
letters of credit arrangements.
“Restricted Subsidiary” means any Subsidiary of the Company, including any Excluded Project
Subsidiary, other than an Unrestricted Subsidiary.
“Sale/Leaseback Transaction” means an arrangement relating to property now owned or hereafter
acquired whereby the Company or a Restricted Subsidiary transfers such property to a Person (other
than the Company or any of its Subsidiaries) and the Company or a Restricted Subsidiary leases it
from such Person.
“SEC” means the United States Securities and Exchange Commission.
“Secured Indebtedness” means any Indebtedness of the Company or any of its Restricted
Subsidiaries secured by a Lien.
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“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
of the SEC promulgated thereunder.
“Senior Credit Facility” means the Credit and Guaranty Agreement dated as of February 9, 2007,
among Covanta Energy Corporation, as borrower, the Company, as guarantor, JPMorgan Chase Bank,
N.A., as Administrative Agent, Collateral Agent, Revolving Issuing Bank and a Funded LC Issuing
Bank, UBS AG, Stamford Branch, as Funded LC Issuing Bank, Xxxxxx Commercial Paper Inc. and Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, as Syndication Agents, and Bank of America, N.A. and
Barclays Bank plc, as Documentation Agents, and the lenders parties thereto from time to time, as
the same may be amended, restated, modified, renewed, refunded, replaced or refinanced in whole or
in part from time to time (including increasing the amount loaned thereunder, provided that such
additional Indebtedness is Incurred in compliance with Section 4.03); provided that a Senior Credit
Facility shall not relate to Indebtedness that does not consist exclusively of Pari Passu
Indebtedness.
“Senior Management” means the Chief Executive Officer, the Chief Financial Officer or the
Treasurer of the Company.
“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant
Subsidiary” of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the
SEC.
“Similar Business” means any business conducted or proposed to be conducted by the Company and
its Restricted Subsidiaries on the Issue Date or any business that is similar, reasonably related,
incidental or ancillary thereto.
“Standard Securitization Undertakings” means representations, warranties, covenants and
indemnities entered into by the Company or any Restricted Subsidiary that are reasonably customary
in securitization of Qualified Receivables Transactions.
“Stated Maturity” means, with respect to any security, the date specified in the agreement
governing or certificate relating to such Indebtedness as the fixed date on which the final payment
of principal of such security is due and payable, including pursuant to any mandatory redemption
provision, but shall not include any contingent obligations to repay, redeem or repurchase any such
principal prior to the date originally scheduled for the payment thereof.
“Subordinated Obligation” means any Indebtedness of the Company (whether outstanding on the
Issue Date or thereafter Incurred) that is subordinated or junior in right of payment to the Notes
pursuant to a written agreement.
“Subsidiary” of any Person means (a) any corporation, association or other business entity
(other than a partnership, joint venture, limited liability company or similar entity) of which
more than 50% of the total ordinary voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of directors, managers or
trustees thereof (or Persons performing similar functions) or (b) any partnership, joint venture
limited liability company or similar entity of which more than 50% of the capital accounts,
distribution rights, total equity and voting interests or general or limited partnership
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interests, as applicable, is, in the case of clauses (a) and (b), at the time owned or
controlled, directly or indirectly, by (1) such Person, (2) such Person and one or more
Subsidiaries of such Person or (3) one or more Subsidiaries of such Person. Unless otherwise
specified herein, each reference to a Subsidiary will refer to a Subsidiary of the Company.
“Tender Offer” means the Company’s offer to purchase for cash any and all of its outstanding
Convertible Debentures pursuant to its Offer to Purchase, dated November 9, 2010.
“Transaction Costs” means the fees, costs and expenses payable by the Company in connection
with the Transactions within 180 days of the Issue Date.
“Transactions” means the issuance of the Notes in this offering and the Tender Offer.
“Total Assets” means the total assets of the Company and its Restricted Subsidiaries on a
consolidated basis determined in accordance with GAAP, as shown on the most recent balance sheet of
the Company or such other Person as may be expressly stated.
“Total Tangible Assets” means Total Assets after deducting accumulated depreciation and
amortization, allowances for doubtful accounts, other applicable reserves and other similar items
of the Company and its Restricted Subsidiaries and after deducting, to the extent otherwise
included therein, the amounts of (without duplication):
(1) the excess of cost of the Fair Market Value of assets or business acquired, as determined
by the Company in good faith (or if such Fair Market Value exceeds $50.0 million, in writing by an
Independent Financial Advisor);
(2) any revaluation or other write-up in book value of assets subsequent to the last day of
the fiscal quarter of the Company immediately preceding the Issue Date as a result of a change in
the method of valuation in accordance with GAAP;
(3) unamortized debt discount and expenses and other unamortized deferred charges, goodwill,
patents, trademarks, service marks, trade names, copyrights, licenses, organization or
developmental expenses and other intangible items;
(4) minority interest in consolidated Subsidiaries held by Persons other than the Company or
any Restricted Subsidiary;
(5) treasury stock;
(6) cash or securities set aside and held in a sinking or other analogous fund established for
the purpose of redemption or other retirement of Capital Stock; and
(7) Investments in and assets of Unrestricted Subsidiaries.
“Treasury Rate” means as of any date of redemption of Notes the yield to maturity at the time
of computation of United States Treasury securities with a constant maturity
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(as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519)
that has become publicly available at least two Business Days prior to the redemption date (or, if
such Statistical Release is no longer published, any publicly available source or similar market
data)) most nearly equal to the period from the redemption date to December 1, 2015; provided,
however, that if the period from the redemption date to December 1, 2015 is not equal to the
constant maturity of a United States Treasury security for which a weekly average yield is given,
the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth
of a year) from the weekly average yields of United States Treasury securities for which such
yields are given, except that if the period from the redemption date to December 1, 2015 is less
than one year, the weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year will be used.
“Union County Lease” means the facility lease agreement as of the Issue Date between Covanta
Union, Inc. and the Union County Utilities Authority relating to the energy-from-waste facility
located in Union County, New Jersey.
“Unrestricted Asian Subsidiaries” means Covanta Energy International Investments Limited and
its Subsidiaries.
“Unrestricted Subsidiary” means:
(1) any Unrestricted Asian Subsidiary;
(2) any Insurance Subsidiary;
(3) any Subsidiary of the Company which at the time of determination shall be designated an
Unrestricted Subsidiary by the Board of Directors in the manner provided below; and
(4) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors of the Company may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary or a Person becoming a Subsidiary through merger or
consolidation or Investment therein) to be an Unrestricted Subsidiary only if:
(1) such Subsidiary or any of its Subsidiaries does not own any Capital Stock or Indebtedness
of or have any Investment in, or own or hold any Lien on any property of, any other Subsidiary of
the Company that is not a Subsidiary of the Subsidiary to be so designated or otherwise an
Unrestricted Subsidiary;
(2) all the Indebtedness of such Subsidiary and its Subsidiaries shall, at the date of
designation, and will at all times thereafter, consist of Non-Recourse Debt;
(3) such designation and the Investment of the Company in such Subsidiary complies with
“Certain covenants—Limitation on restricted payments;”
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(4) such Subsidiary, either alone or in the aggregate with all other Unrestricted
Subsidiaries, does not operate, directly or indirectly, all or substantially all of the business of
the Company and its Subsidiaries;
(5) such Subsidiary is a Person with respect to which neither the Company nor any of its
Restricted Subsidiaries has any direct or indirect obligation:
(a) to subscribe for additional Capital Stock of such Person; or
(b) to maintain or preserve such Person’s financial condition or to cause such
Person to achieve any specified levels of operating results; and
(6) on the date such Subsidiary is designated an Unrestricted Subsidiary, such Subsidiary is
not a party to any agreement, contract, arrangement or understanding with the Company or any
Restricted Subsidiary with terms substantially less favorable to the Company than those that might
have been obtained from Persons who are not Affiliates of the Company.
Any such designation shall be evidenced to the Trustee by filing with the Trustee a resolution
of the Board of Directors of the Company, if applicable, giving effect to such designation and an
Officers’ Certificate certifying that such designation complies with the foregoing conditions. If,
at any time, any Unrestricted Subsidiary would fail to meet the foregoing requirements as an
Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of
the Indenture and any Indebtedness of such Subsidiary shall be deemed to be Incurred as of such
date.
The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided that immediately after giving effect to such designation, no
Default or Event of Default shall have occurred and be continuing or would occur as a consequence
thereof and the Company could Incur at least $1.00 of additional Indebtedness pursuant to the first
paragraph of the “Certain covenants—Limitation on indebtedness” covenant on a pro forma basis
taking into account such designation.
“Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding
and normally entitled to vote in the election of directors, managers or trustees, as applicable, of
such Person.
“Wholly-Owned Subsidiary” means a Restricted Subsidiary, all of the Capital Stock of which
(other than directors’ qualifying shares) is owned by the Company or another Wholly-Owned
Subsidiary.
ARTICLE 2
ISSUE AND DESCRIPTION OF NOTES
SECTION 2.01. Designation and Amount. The Notes shall be designated as “7.250%
Senior Notes due 2020”.
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There are to be authenticated and delivered Notes, initially limited in aggregate principal
amount of $400,000,000 and no further Notes shall be authenticated and delivered except as provided
by the terms of the Indenture, including, that additional Notes having identical terms and
conditions as the Notes other than issue date, the issue price, the date from which interest
thereon shall accrue, legends, if any, to be included thereon and the first Interest Payment Date
(the “Additional Notes”) may be issued from time to time in the future, without the consent of the
Holders of the Notes, in accordance with the provisions of this Second Supplemental Indenture. With
respect to any Additional Notes, the Company shall set forth in a resolution of the Board of
Directors or an Officers’ Certificate, the following information:
(a) the aggregate principal amount of such Additional Notes to be authenticated and delivered
pursuant to the Indenture;
(b) the issue date, the issue price, the first Interest Payment Date of such Additional Notes,
the date from which interest shall accrue and legends, if any, to be included thereon; and
(c) the CUSIP and ISIN numbers of the Additional Notes.
The Notes and the Additional Notes, if any, shall be considered collectively as a single class
for all purposes of the Indenture. Holders of the Notes and the Additional Notes, if any, shall
vote and consent together on all matters to which such Holders are entitled to vote or consent as
one class, and none of the Holders of the Notes or the Additional Notes, if any, shall have the
right to vote or consent as a separate class on any matter to which such Holders are entitled to
vote or consent.
SECTION 2.02. Form of the Notes. The Notes and the Trustee’s certificate of
authentication to be borne by such Notes shall be substantially in the form set forth in
Exhibit A hereto. The terms and provisions contained in the form of Notes attached as
Exhibit A hereto shall constitute, and are hereby expressly made, a part of this Second
Supplemental Indenture and, to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Second Supplemental Indenture, expressly agree to such terms and
provisions and to be bound thereby.
SECTION 2.03. Date and Denomination of Notes; Payment at Maturity; Payment of
Interest.
(a) Date and Denomination. The Notes shall be issuable in fully registered form
without coupons in denominations of $2,000 and integral multiples of $1,000 in excess thereof.
Each Note shall be dated the date of its authentication and shall bear interest from the date
specified on the face of the form of Notes attached as Exhibit A hereto.
(b) Payment at Maturity. The Notes shall mature on December 1, 2020, unless earlier
redeemed or repurchased in accordance with the provisions hereof. With respect to Global Notes,
principal and interest will be paid to the Depositary in immediately available funds. With respect
to any certificated Notes, principal and interest will be payable at the Company’s office or
agency, which initially will be the office or agency of the Trustee. If the Maturity Date is not a
Business Day, payment shall be made on the next succeeding Business Day, and no additional interest
shall accrue thereon.
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(c) Payment of Interest. Interest on the Notes shall accrue at the rate of 7.250% per
annum, from December 1, 2010 until the principal thereof is paid or made available for payment.
Interest shall be payable on June 1 and December 1 of each year (each, an “Interest Payment Date”),
commencing June 1, 2011, to the Person in whose name any Note is registered on the Register at 5:00
p.m., New York City time, on any Record Date with respect to the applicable Interest Payment Date,
except that the interest payable on the Maturity Date will be paid to the Person to whom the
principal amount is paid.
SECTION 2.04. Defaulted Interest. Solely with respect to the Notes, Section 2.13 of
the Original Indenture shall be amended and restated in its entirety by inserting the following in
lieu thereof:
(a) If the Company defaults in a payment of interest on the Notes, it shall pay the defaulted
interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date, in each case at the
rate provided in the Notes and in Section 2.03. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date of the proposed
payment, and at the same time the Company shall deposit with the Trustee an amount of money equal
to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the Persons entitled to
such defaulted interest as provided in this Section 2.04. The Trustee shall fix or cause to be
fixed each such special record date and payment date; provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted interest. The
Trustee shall promptly notify the Company of such special record date. At least 15 days before the
special record date, the Company (or, upon the written request of the Company, the Trustee in the
name and at the expense of the Company) shall mail, or cause to be mailed to each Holder a notice
that states the special record date, the related payment date and the amount of such interest to be
paid.
(b) Subject to the foregoing provisions of this Section 2.04 and for greater certainty, each
Note delivered under this Second Supplemental Indenture upon registration of transfer of or in
exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid,
and to accrue interest, which were carried by such other Note.
ARTICLE 3
REDEMPTION OF NOTES
SECTION 3.01. Optional Redemption.
(a) Prior to December 1, 2013, the Company may, at its option, on any one or more occasions
redeem up to 35% of the original aggregate principal amount of the Notes (calculated after giving
effect to any issuance of Additional Notes) with the Net Cash Proceeds of one or more Equity
Offerings at a redemption price equal to 107.25% of the aggregate principal amount thereof, plus
accrued and unpaid interest, if any, to the redemption date (the
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“Redemption Date”), subject to the right of Holders of record on a Record Date prior to such
Redemption Date to receive interest due on the following Interest Payment Date; provided that:
(1) at least 65% of the original aggregate principal amount of the Notes
(calculated after giving effect to any issuance of Additional Notes) remains
outstanding after each such redemption; and
(2) such redemption occurs within 90 days after the closing of such Equity
Offering.
(b) Prior to December 1, 2015, the Company may redeem the Notes, in whole but not in
part, at a redemption price equal to 100% of the aggregate principal amount of the Notes plus the
Applicable Premium, plus accrued and unpaid interest, if any, to the Redemption Date, subject to
the right of Holders of record on a Record Date on or prior to such Redemption Date to receive
interest due on the following Interest Payment Date.
(c) From and after December 1, 2015, the Company may redeem the Notes, in whole or in part, at
the redemption prices (expressed as a percentage of principal amount of the Notes to be redeemed)
set forth below, plus accrued and unpaid interest on the Notes, if any, to the applicable date of
redemption, (subject to the right of Holders of record on a Record Date on or prior to such
Redemption Date to receive interest due on the following Interest Payment Date), if redeemed during
the twelve-month period beginning on December 1 of the years indicated below:
| Year | Percentage | |||
2015 |
103.625 | % | ||
2016 |
102.417 | % | ||
2017 |
101.208 | % | ||
2018 and thereafter |
100.000 | % | ||
SECTION 3.02. Mandatory Redemption; Open Market Purchases. (a) The Company shall
not be required to make any mandatory redemption with respect to the Notes.
(b) The Company may acquire Notes by means other than a redemption, whether by tender offer,
open market purchases, negotiated transactions or otherwise, in accordance with applicable
securities laws, so long as such acquisition does not otherwise violate the terms of this Second
Supplemental Indenture.
SECTION 3.03. Notice of Redemption. In case the Company shall desire to exercise
the right to redeem all or, as the case may be, any part of the Notes pursuant to Section 3.01, it
shall fix a Redemption Date and it or, at its written request received by the Trustee not fewer
than 10 calendar days prior (or such shorter period of time as may be acceptable to the Trustee)
to the date the notice of redemption is to be mailed, the Trustee in the name of and at the expense
of the Company, shall mail or cause to be mailed a notice of such redemption not less than 30
calendar days nor more than 60 calendar days prior to the Redemption Date to all holders of record
at their last addresses as the same appear on the Register; provided that if the Company makes such
request of the Trustee, the text of the notice shall be prepared by the
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Company. Such mailing shall be by first class mail. The notice, if mailed in the manner
herein provided, shall be conclusively presumed to have been duly given, whether or not the holder
receives such notice. In any case, failure to give such notice by mail or any defect in the notice
to the holder of any Notes designated for redemption as a whole or in part shall not affect the
validity of the proceedings for the redemption of any other Notes.
Each such notice of redemption shall specify:
(a) the aggregate principal amount of Notes to be redeemed;
(b) the CUSIP number or numbers of the Notes being redeemed;
(c) the Redemption Date;
(d) the Redemption Price at which the Notes are to be redeemed;
(e) the name of the Paying Agent, the place or places of payment and that payment will
be made upon presentation and surrender of such Notes;
(f) that interest accrued and unpaid to, but excluding, the Redemption Date will be
paid as specified in said notice, and that on and after such date, interest thereon or on
the portion thereof to be redeemed will cease to accrue;
(g) the paragraph of the Notes pursuant to which the Notes called for redemption are
being redeemed; and
(h) that no representation is made as to the correctness or accuracy of the CUSIP
number, if any, listed in such notice or printed on the Notes.
If fewer than all the Notes are to be redeemed, the notice of redemption shall identify the
Notes to be redeemed. In case any Notes are to be redeemed in part only, the notice of redemption
shall state the portion of the principal amount thereof to be redeemed and shall state that, on and
after the Redemption Date, upon surrender of such Notes, a new Note or Notes in principal amount
equal to the unredeemed portion thereof will be issued.
Whenever any Notes are to be redeemed, the Company shall give the Trustee written notice of
the Redemption Date, together with an Officers’ Certificate as to the aggregate principal amount of
Notes to be redeemed not fewer than 40 calendar days (or such shorter period of time as may be
acceptable to the Trustee) prior to the Redemption Date.
SECTION 3.04. Selection of Notes to be Redeemed. In the case of any partial redemption,
selection of the Notes for redemption shall be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the Notes are listed
or, if the Notes are not listed, then on a pro rata basis, by lot or by such other method as the
Trustee in its sole discretion shall deem to be fair and appropriate or in accordance with DTC
procedures, although no Note of $2,000 in original principal amount or less shall be redeemed in
part.
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SECTION 3.05. Notes Redeemed in Part. Upon presentation of any Notes redeemed in
part only, the Company shall execute, and the Trustee shall authenticate and make available for
delivery to the holder thereof, at the expense of the Company, a new Note or Notes, of authorized
denominations, in aggregate principal amount equal to the unredeemed portion of the Notes
presented.
ARTICLE 4
ADDITIONAL COVENANTS
SECTION 4.01. Reporting Covenant. Section 4.2 of the Original Indenture is hereby
amended and restated with respect to the Notes (but not with respect to any other series of
Securities) as follows:
“(a) Notwithstanding that the Company may not be subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on
forms provided for such annual and quarterly reporting pursuant to rules and regulations
promulgated by the SEC, if not filed electronically with the SEC through XXXXX (or any successor
system), the Company shall file with the SEC (to the extent permitted by the Exchange Act), and
make available to the Trustee and the Holders, without cost to any Holder, the annual reports and
the information, documents and other reports (or copies of such portions of any of the foregoing as
the SEC may by rules and regulations prescribe) that are specified in Sections 13 and 15(d) of the
Exchange Act with respect to U.S. issuers within the time periods specified therein or in the
relevant forms. The Company will also comply with the other provisions of TIA Section 314(a).
(b) In the event that the Company is not permitted to file such reports, documents and
information with the SEC pursuant to the Exchange Act, the Company shall nevertheless make
available such Exchange Act reports, documents and information to the Trustee and the Holders as if
the Company were subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act
within the time periods specified therein or in the relevant forms, which requirement may be
satisfied by posting such reports, documents and information on its website within the time periods
specified in this Section 4.01.
(c) If the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries and
such Unrestricted Subsidiaries, either individually or collectively, would otherwise have been a
Significant Subsidiary, then the quarterly and annual financial information required by Section
4.01(b) shall include in the “Management’s discussion and analysis of financial condition and
results of operations” section, revenue, Consolidated Indebtedness, Consolidated Interest Expense,
Consolidated Adjusted EBITDA and capital expenditures of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of the Unrestricted
Subsidiaries.
The Company shall be deemed to have furnished the reports to the Trustee and the Holders if it
has filed such reports with the SEC via the XXXXX filing system and such reports are publicly
available. The Trustee shall have no obligation whatsoever to determine whether or
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not such information, documents, or reports have been filed pursuant to the “XXXXX” system (or
its successor) or the Company’s website.
Delivery of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained therein, including the
Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to
rely exclusively on Officers’ Certificates).”
SECTION 4.02. Covenant Suspension. Following the first day the Notes have an
Investment Grade Rating from both of the Rating Agencies and no Default or Event of Default has
occurred and is continuing, the Company and the Restricted Subsidiaries shall not be subject to
Sections 4.03, 4.04, 4.08, 4.09, 4.10 and 5.01(a)(4) (collectively, the “Suspended Covenants”). If
at any time the Notes’ credit rating is downgraded from an Investment Grade Rating by any Rating
Agency or if a Default or Event of Default occurs and is continuing, then from the date of such
occurrence (the “Reinstatement Date”), the Suspended Covenants shall thereafter be reinstated as if
such covenants had never been suspended and be applicable (including in connection with performing
any calculation or assessment to determine compliance with the terms of the Indenture), unless and
until the Notes subsequently attain an Investment Grade Rating from both of the Rating Agencies and
no Default or Event of Default is in existence (in which event the Suspended Covenants shall no
longer be in effect for such time that the Notes maintain an Investment Grade Rating from both of
the Rating Agencies and no Default or Event of Default is in existence); provided, however, that no
Default, Event of Default or breach of any kind shall be deemed to exist under the Indenture or the
Notes with respect to the Suspended Covenants based on, and none of the Company or any of its
Subsidiaries shall bear any liability for, any actions taken or events occurring during the
Suspension Period (as defined below), regardless of whether such actions or events would have been
permitted if the applicable Suspended Covenants remained in effect during such period. The period
of time between the date of suspension of the covenants and the Reinstatement Date is referred to
as the “Suspension Period.”
On the Reinstatement Date, all Indebtedness Incurred during the Suspension Period will be
classified to have been Incurred pursuant to Section 4.03(a) or one of the clauses set forth in
Section 4.03(b) (to the extent such Indebtedness would be permitted to be Incurred thereunder as of
the Reinstatement Date and after giving effect to Indebtedness Incurred prior to the Suspension
Period and outstanding on the Reinstatement Date). To the extent such Indebtedness would not be so
permitted to be Incurred pursuant to Section 4.03(a) and 4.03(b) hereof, such Indebtedness will be
deemed to have been outstanding on the Issue Date, so that it is classified under Section
4.03(b)(3) hereof. Calculations made after the Reinstatement Date of the amount available to be
made as Restricted Payments shall be made as though the covenants described under Section 4.04
hereof had been in effect since the Issue Date and throughout the Suspension Period. Accordingly,
Restricted Payments made during the Suspension Period shall reduce the amount available to be made
as Restricted Payments under Section 4.04(a).
During any period when the Suspended Covenants are suspended, neither the Board of Directors
of the Company nor Senior Management may designate any of the Company’s Subsidiaries as
Unrestricted Subsidiaries or Excluded Project Subsidiaries.
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SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not, and shall not
permit any of its Restricted Subsidiaries to, directly or indirectly, Incur any Indebtedness
(including Acquired Indebtedness); provided, however, that the Company and its Restricted
Subsidiaries may Incur Indebtedness if on the date thereof and after giving effect thereto on a pro
forma basis:
(1) the Consolidated Coverage Ratio for the Company and its Restricted Subsidiaries is at
least 2.00 to 1.00;
(2) in the case of Indebtedness Incurred by a Restricted Subsidiary, the Combined Leverage
Ratio for the Company’s Restricted Subsidiaries is no greater than 4.00 to 1.00; and
(3) no Default or Event of Default will have occurred or be continuing or would occur as a
consequence of Incurring the Indebtedness or entering into the transactions relating to such
Incurrence.
(b) Section 4.03(a) shall not prohibit the Incurrence of the following Indebtedness:
(1) Indebtedness of the Company or any Restricted Subsidiary Incurred under a Debt Facility
and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with
undrawn trade letters of credit and reimbursement obligations relating to trade letters of credit
satisfied within 30 days being excluded, and bankers’ acceptances being deemed to have a principal
amount equal to the face amount thereof) together with the principal component of amounts
outstanding under Qualified Receivables Transactions in an aggregate amount up to $1,770.0 million
less the aggregate principal amount of all principal repayments with the proceeds from Asset
Dispositions made pursuant to Section 4.08(a)(3)(a) in satisfaction of the requirements of such
section;
(2) Indebtedness represented by the Notes (other than any Additional Notes);
(3) Indebtedness of the Company and its Restricted Subsidiaries in existence on the Issue
Date (other than Indebtedness described in clauses (1), (2), (4), (5), (7), (10), (11) and (12) of
this Section 4.03);
(4) Guarantees by (a) Excluded Project Subsidiaries of Indebtedness of any other Excluded
Project Subsidiary; and (b) Restricted Subsidiary of Indebtedness Incurred by Restricted
Subsidiaries in accordance with the provisions of the Indenture;
(5) Indebtedness of the Company owing to and held by any Restricted Subsidiary (other than a
Receivables Entity) or Indebtedness of a Restricted Subsidiary owing to and held by the Company or
any other Restricted Subsidiary (other than a Receivables Entity); provided, however, that
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(a) any subsequent issuance or transfer of Capital Stock or any other event
which results in any such Indebtedness being beneficially held by a Person other
than the Company or a Restricted Subsidiary (other than a Receivables Entity) of the
Company; and
(b) any sale or other transfer of any such Indebtedness to a Person other than
the Company or a Restricted Subsidiary (other than a Receivables Entity) of the
Company shall be deemed, in each case, to constitute an Incurrence of such
Indebtedness by the Company or such Restricted Subsidiary, as the case may be.
(6) Indebtedness of Persons Incurred and outstanding on the date on which such Person became
a Restricted Subsidiary or was acquired by, or merged into, the Company or any Restricted
Subsidiary (other than Indebtedness Incurred (a) to provide all or any portion of the funds
utilized to consummate the transaction or series of related transactions pursuant to which such
Restricted Subsidiary became a Restricted Subsidiary or was otherwise acquired by the Company or
(b) otherwise in connection with, or in contemplation of, such acquisition); provided, however,
that at the time such Person is acquired, the Company would have been able to Incur $1.00 of
additional Indebtedness pursuant to the first paragraph of this covenant after giving effect to the
Incurrence of such Indebtedness pursuant to this clause (6);
(7) Indebtedness under Hedging Obligations that are Incurred in the ordinary course of
business (and not for speculative purposes);
(8) Indebtedness Incurred as a result of the accounting for an extension of the term of the
Union County Lease as a capital lease under GAAP solely as a result of such extension; provided
that neither the Company nor any Restricted Subsidiary has incurred Indebtedness for new borrowed
money in connection with such extension;
(9) Indebtedness (including Capitalized Lease Obligations) of the Company or a Restricted
Subsidiary (excluding Acquired Indebtedness) Incurred (i) to finance all or any part of the cost of
the purchase, lease, construction or improvement of any property, plant or equipment used or to be
used in the business of the Company or such Restricted Subsidiary or (ii) as a result of entering
into of any extension of an operating lease entered into to finance all or any portion of the cost
of the purchase, lease, construction or improvement of any property, plant or equipment used or to
be used in the business of the Company or such Restricted Subsidiary, and any Indebtedness of a
Restricted Subsidiary which serves to refund or refinance any Indebtedness Incurred pursuant to
this clause (9) in an aggregate outstanding principal amount which, when taken together with the
principal amount of all other Indebtedness Incurred pursuant to this clause (9) and then
outstanding, will not exceed the greater of (x) $200.0 million and (y) 5.0% of Total Tangible
Assets at any time outstanding;
(10) Indebtedness Incurred by the Company or its Restricted Subsidiaries in respect of
workers’ compensation claims, health, disability or other employee benefits or property, casualty
or liability insurance, self-insurance obligations, performance, bid, surety statutory, appeal,
payment and similar bonds and completion guarantees (not for borrowed money) (including any bonds
or letters of credit issued with respect thereto and all
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reimbursement and indemnity agreements entered into in connection therewith) and Indebtedness
consisting solely of obligations under Insurance Premium Financing Arrangements or reinsurance
arrangements, provided in the ordinary course of business;
(11) Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing
for indemnification, adjustment of purchase price or similar obligations, in each case, Incurred or
assumed in connection with the disposition or acquisition of any business or assets of the Company
or any business, assets or Capital Stock of a Restricted Subsidiary, other than Guarantees of
Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or a
Subsidiary for the purpose of financing such acquisition; provided that:
(a) the maximum aggregate liability in respect of all such Indebtedness shall
at no time exceed (i) in the case of a disposition the gross proceeds, including
non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at
the time received and without giving effect to subsequent changes in value),
actually received by the Company and its Restricted Subsidiaries in connection with
such disposition and (ii) in the case of an acquisition, the Fair Market Value of
such acquired business, asset or Subsidiary being measured at the time received and
without giving effect to subsequent changes in value; and
(b) such Indebtedness is not reflected on the balance sheet of the Company or
any of its Restricted Subsidiaries (contingent obligations referred to in a footnote
to financial statements and not otherwise reflected on the balance sheet will not be
deemed to be reflected on such balance sheet for purposes of this clause (11));
(12) Indebtedness (x) arising from the honoring by a bank or other financial institution of a
check, draft or similar instrument (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is
extinguished within five Business Days of Incurrence, and (y) in respect of netting services,
overdraft protections and otherwise in connection with deposit accounts; provided, however, that
such Indebtedness remains outstanding only for 10 Business Days or less;
(13) the Incurrence or issuance by the Company or any Restricted Subsidiary of Refinancing
Indebtedness that serves to refund or refinance any Indebtedness Incurred as permitted under
Section 4.03(a) and clauses (2), (3), (6) and this clause (13) of Section 4.03(b) or any
Indebtedness issued to so refund or refinance such Indebtedness, including additional Indebtedness
Incurred to pay premiums (including reasonable, as determined in good faith by the Company, tender
premiums), defeasance costs, accrued interest and fees and expenses in connection therewith;
(14) the Incurrence of Non-Recourse Debt by any Excluded Project Subsidiary;
(15) the Incurrence of Non-Recourse Debt by any Restricted Subsidiary that is not an Excluded
Project Subsidiary to (i) fund Construction Capital Expenditures; provided the amount of such
Non-Recourse Debt does not exceed 75% of the cost of the addition or improvement to the Project
that is funded by such Non-Recourse Debt or (ii) refund or refinance
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any Non-Recourse Debt Incurred by such Restricted Subsidiary as permitted by the Indenture,
including additional Indebtedness Incurred to pay premiums (including reasonable, as determined in
good faith by the Company, tender premiums), defeasance costs, accrued interest and fees and
expenses in connection therewith;
(16) Indebtedness with respect to contingent obligations incurred in exchange (or in
consideration) for (i) the release of cash collateral pledged by the Company or its Restricted
Subsidiaries for closure costs or other obligations Incurred in the ordinary course of business or
(ii) the return and cancellation of undrawn letters of credit for which the Company or its
Restricted Subsidiaries are liable for reimbursement, in each case which pledge or issuance of
letter of credit was outstanding on the Issue Date or made in accordance with the Indenture;
(17) Indebtedness Incurred in connection with the redemption of Disqualified Stock issued by
any Insurance Subsidiary in an aggregate amount of up to $5.0 million; and
(18) in addition to the items referred to in clauses (1) through (17) above, Indebtedness of
the Company and its Restricted Subsidiaries in an aggregate outstanding principal amount which,
when taken together with the principal amount of all other Indebtedness Incurred pursuant to this
clause (18) and then outstanding, will not exceed $250.0 million at any time outstanding.
(c) Notwithstanding the foregoing, the Company shall not Incur any Indebtedness under Section
4.03(b) if the proceeds thereof are used, directly or indirectly, to refinance any Subordinated
Obligations of the Company unless such Indebtedness will be subordinated to the Notes to at least
the same extent as such Subordinated Obligations. No Restricted Subsidiary may Incur any
Indebtedness if the proceeds are used to refinance Indebtedness of the Company, except for
Indebtedness of the Company constituting Guarantees of the Restricted Subsidiary Indebtedness being
refinanced.
(d) For purposes of determining compliance with, and the outstanding principal amount of any
particular Indebtedness Incurred pursuant to and in compliance with this Section 4.03:
(1) in the event that Indebtedness meets the criteria of more than one of the types of
Indebtedness described in Section 4.03(b), the Company, in its sole discretion, shall classify such
item of Indebtedness on the date of Incurrence and may later classify such item of Indebtedness in
any manner that complies with Section 4.03(b) and only be required to include the amount and type
of such Indebtedness in one of such clauses under Section 4.03(b), provided that all Indebtedness
outstanding on the Issue Date under the Senior Credit Facility shall be deemed Incurred under
Section 4.03(b)(1) and not Section 4.03(a) or Section 4.03(b)(3) and may not later be reclassified;
(2) Guarantees of, or obligations in respect of letters of credit relating to, Indebtedness
that is otherwise included in the determination of a particular amount of Indebtedness shall not be
included;
(3) if obligations in respect of letters of credit are Incurred pursuant to a Debt Facility
and are being treated as Incurred pursuant to Section 4.03(b)(1) and the letters of credit relate
to other Indebtedness, then such other Indebtedness shall not be included;
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(4) the principal amount of any Disqualified Stock of the Company or a Restricted Subsidiary,
or Preferred Stock of a Restricted Subsidiary, will be equal to the greater of the maximum
mandatory redemption or repurchase price (not including, in either case, any redemption or
repurchase premium) or the liquidation preference thereof;
(5) Indebtedness permitted by this Section 4.03 need not be permitted solely by reference to
one provision permitting such Indebtedness but may be permitted in part by one such provision and
in part by one or more other provisions of this Section 4.03 covenant permitting such Indebtedness;
(6) the principal amount of any Indebtedness outstanding in connection with a Qualified
Receivables Transaction is the Receivables Transaction Amount relating to such Qualified
Receivables Transaction; and
(7) the amount of Indebtedness issued at a price that is less than the principal amount
thereof shall be equal to the amount of the liability in respect thereof determined in accordance
with GAAP.
Accrual of interest, accrual of dividends, the accretion of accreted value, the amortization of
debt discount, the payment of interest in the form of additional Indebtedness and the payment of
dividends in the form of additional shares of Preferred Stock or Disqualified Stock shall not be
deemed to be an Incurrence of Indebtedness for purposes of this Section 4.03. The amount of any
Indebtedness outstanding as of any date shall be (i) the accreted value thereof in the case of any
Indebtedness issued with original issue discount or the aggregate principal amount outstanding in
the case of Indebtedness issued with interest payable in kind and (ii) the principal amount or
liquidation preference thereof, together with any interest thereon that is more than 30 days past
due, in the case of any other Indebtedness.
(e) Except as otherwise provided in this Section 4.03, the Company shall not permit any of its
Unrestricted Subsidiaries or its Excluded Project Subsidiaries to Incur any Indebtedness or issue
any shares of Disqualified Stock, other than Non-Recourse Debt.
(f) If at any time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any
Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted Subsidiary as of
such date (and, if such Indebtedness is not permitted to be Incurred as of such date under this
Section 4.03, the Company shall be in Default of this Section 4.03).
(g) For purposes of determining compliance with any U.S. dollar-denominated restriction on the
Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated
in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on
the date such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in
the case of revolving credit Indebtedness; provided that if such Indebtedness is Incurred to
refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause
the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated
restriction shall be deemed not to have been exceeded
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so long as the principal amount of such Refinancing Indebtedness does not exceed the principal
amount of such Indebtedness being refinanced. Notwithstanding any other provision of this Section
4.03 the maximum amount of Indebtedness that the Company may Incur pursuant to Section 4.03 shall
not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies.
The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a
different currency from the Indebtedness being refinanced, shall be calculated based on the
currency exchange rate applicable to the currencies in which such Refinancing Indebtedness is
denominated that is in effect on the date of such refinancing.
SECTION 4.04. Limitation on Restricted Payments. (a) The Company shall not, and shall
not permit any of its Restricted Subsidiaries, directly or indirectly, to:
(1) declare or pay any dividend or make any distribution (whether made in cash, securities or
other property) on or in respect of its or any of its Restricted Subsidiaries’ Capital Stock
(including any payment in connection with any merger or consolidation involving the Company or any
of its Restricted Subsidiaries) other than:
(a) dividends or distributions payable solely in Capital Stock of the Company (other than
Disqualified Stock); and
(b) dividends or distributions by a Restricted Subsidiary, so long as, in the
case of any dividend or distribution payable on or in respect of any Capital Stock
issued by a Restricted Subsidiary that is not a Wholly-Owned Subsidiary, the Company
or the Restricted Subsidiary holding such Capital Stock receives at least its pro
rata share of such dividend or distribution;
(2) purchase, redeem, retire or otherwise acquire for value, including in connection with any
merger or consolidation, any Capital Stock of the Company or any direct or indirect parent of the
Company held by Persons other than the Company or a Restricted Subsidiary (other than in exchange
for Capital Stock of the Company (other than Disqualified Stock));
(3) make any principal payment on, or purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, prior to any scheduled repayment, scheduled sinking fund payment or
scheduled maturity, any Subordinated Obligations other than the purchase, repurchase, redemption,
defeasance or other acquisition or retirement of Subordinated Obligations purchased in anticipation
of satisfying a sinking fund obligation, principal installment or final maturity, in each case due
within one year of the date of purchase, repurchase, redemption, defeasance or other acquisition or
retirement); or
(4) make any Restricted Investment (all such payments and other actions referred to in
clauses (1) through (4) (other than any exception thereto) shall be referred to as a “Restricted
Payment”),
unless, at the time of and after giving effect to such Restricted Payment:
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(a) no Default shall have occurred and be continuing (or would result
therefrom);
(b) immediately after giving effect to such transaction on a pro forma basis,
the Company could Incur $1.00 of additional Indebtedness under Section 4.03(a)
hereof; and
(c) the aggregate amount of such Restricted Payment and all other Restricted
Payments declared or made subsequent to the Issue Date (excluding Restricted
Payments made pursuant to clauses (1), (2), (3), (8), (9), (10) and (11) of Section
4.04(b)) would not exceed the sum of (without duplication):
(i) Consolidated Adjusted EBITDA of the Company and its Restricted
Subsidiaries, minus (A) capital expenditures of the Company and its
Restricted Subsidiaries other than Construction Capital Expenditures, and
(B) 140% of Consolidated Interest Expense of the Company and its Restricted
Subsidiaries, in each case, for the period (treated as one accounting
period) from the beginning of the first fiscal quarter commencing October 1,
2010 to the end of the most recent fiscal quarter ending prior to the date
of such Restricted Payment for which financial statements are available
provided, that the calculation of Consolidated Adjusted EBITDA and the
adjustments to Consolidated Adjusted EBITDA for the purposes of this clause
(i) shall exclude all amounts attributable to Excluded Project Subsidiaries
that are Excluded Project Subsidiaries as of the date of calculation, other
than to include the aggregate amount of cash that has been distributed
during such period or that is distributable as of such date by such Excluded
Project Subsidiary; plus
(ii) 100% of the aggregate Net Cash Proceeds and the Fair Market Value
of marketable securities or other property received by the Company from the
issue or sale of its Capital Stock (other than Disqualified Stock) or other
capital contributions subsequent to the Issue Date, other than:
(x) Net Cash Proceeds received from an issuance or sale of such
Capital Stock to a Subsidiary of the Company or to an employee stock
ownership plan, option plan or similar trust to the extent such sale
to an employee stock ownership plan or similar trust is financed by
loans from or Guaranteed by the Company or any Restricted Subsidiary
unless such loans have been repaid with cash on or prior to the date
of determination); and
(y) Net Cash Proceeds received by the Company from the issue and
sale of its Capital Stock or capital contributions to the
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extent applied to redeem Notes in compliance with the provisions
set forth under the Section 3.01; plus
(iii) the amount by which Indebtedness of the Company or its
Restricted Subsidiaries is reduced on the Company’s consolidated balance
sheet upon the conversion or exchange (other than (x) debt held by a
Subsidiary of the Company or (y) the outstanding Convertible Debentures)
subsequent to the Issue Date of any Indebtedness of the Company or its
Restricted Subsidiaries convertible or exchangeable for Capital Stock (other
than Disqualified Stock) of the Company (less the amount of any cash, or the
fair market value of any other property, distributed by the Company upon
such conversion or exchange); plus
(iv) the amount equal to the net reduction in Restricted Investments
made by the Company or any of its Restricted Subsidiaries in any Person
resulting from:
(x) repurchases or redemptions of such Restricted Investments by
such Person, proceeds realized upon the sale of such Restricted
Investment to an unaffiliated purchaser, repayments of loans or
advances or other transfers of assets (including by way of dividend
or distribution) by such Person to the Company or any Restricted
Subsidiary (other than for reimbursement of tax payments); or
(y) the redesignation of Unrestricted Subsidiaries as Restricted
Subsidiaries or the merger or consolidation of an Unrestricted
Subsidiary with and into the Company or any of its Restricted
Subsidiaries (valued in each case as provided in the definition of
“Investment”) not to exceed the amount of Investments previously made
by the Company or any Restricted Subsidiary in such Unrestricted
Subsidiary,
which amount in each case under this clause (iv) was included in the
calculation of the amount of Restricted Payments; provided, however, that no
amount will be included under this clause (iv) to the extent it is already
included in Consolidated Net Income.
(b) Section 4.04(a) shall not prohibit:
(1) any purchase, repurchase, redemption, defeasance or other acquisition or retirement of
Capital Stock, Disqualified Stock or Subordinated Obligations of the Company made by exchange for,
or out of the proceeds of the substantially concurrent sale of, Capital Stock of the Company (other
than Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary or an employee
stock ownership plan or similar trust to the extent such sale to an employee stock ownership plan
or similar trust is financed by loans from or
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Guaranteed by the Company or any Restricted Subsidiary unless such loans have been repaid with
cash on or prior to the date of determination); provided, however, that the Net Cash Proceeds from
such sale of Capital Stock will be excluded from clause (c)(ii) Section 4.04(a);
(2) any purchase, repurchase, redemption, defeasance or other acquisition or retirement of
Subordinated Obligations of the Company made by exchange for, or out of the proceeds of the
substantially concurrent sale of, Subordinated Obligations of the Company so long as such
refinancing Subordinated Obligations are permitted to be Incurred pursuant to Section 4.03 and
constitute Refinancing Indebtedness;
(3) any purchase, repurchase, redemption, defeasance or other acquisition or retirement of
Disqualified Stock of the Company or a Restricted Subsidiary made by exchange for or out of the
proceeds of the substantially concurrent sale of Disqualified Stock of the Company or such
Restricted Subsidiary, as the case may be, so long as such refinancing Disqualified Stock is
permitted to be Incurred pursuant to Section 4.03 and constitutes Refinancing Indebtedness;
(4) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for
value of any Subordinated Obligation (a) at a purchase price not greater than 101% of the principal
amount of such Subordinated Obligation in the event of a Change of Control in accordance with
provisions similar to Section 4.07 or (b) at a purchase price not greater than 100% of the
principal amount thereof in accordance with provisions similar to the Section 4.08; provided that,
prior to or simultaneously with such purchase, repurchase, redemption, defeasance or other
acquisition or retirement, the Company has made the Change of Control Offer or Asset Disposition
Offer, as applicable, as provided in such covenant with respect to the Notes and has completed the
repurchase or redemption of all Notes validly tendered for payment in connection with such Change
of Control Offer or Asset Disposition Offer;
(5) any purchase or redemption of Subordinated Obligations from Net Available Cash to the
extent permitted under Section 4.08;
(6) dividends paid within 90 days after the date of declaration if at such date of
declaration such dividend would have complied with this provision;
(7) the purchase, redemption or other acquisition, cancellation or retirement for value of
Capital Stock or equity appreciation rights of the Company or any direct or indirect parent of the
Company held by any existing or former employees or management of the Company or any Subsidiary of
the Company or their assigns, estates or heirs, in each case in connection with the repurchase
provisions under employee stock option or stock purchase agreements or other agreements with
management employees approved by the Board of Directors or Senior Management; provided that such
Capital Stock or equity appreciation rights were received for services related to, or for the
benefit of, the Company and its Restricted Subsidiaries; and provided, further, that such
redemptions or repurchases pursuant to this clause will not exceed $5.0 million in the aggregate
during any calendar year, although such amount in any calendar year may be increased by an amount
not to exceed:
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(a) the Net Cash Proceeds from the sale of Capital Stock (other than
Disqualified Stock) of the Company and, to the extent contributed to the
Company, Capital Stock of any of the Company’s direct or indirect parent
companies, in each case to existing or former employees or members of
management of the Company, any of its Subsidiaries or any of its direct or
indirect parent companies that occurs after the Issue Date, to the extent
the Net Cash Proceeds from the sale of such Capital Stock have not otherwise
been applied to the payment of Restricted Payments (provided that the Net
Cash Proceeds from such sales or contributions shall be excluded from clause
(c)(ii) of Section 4.04(a)); plus
(b) the cash proceeds of key man life insurance policies received by
the Company or its Restricted Subsidiaries after the Issue Date; less
(c) the amount of any Restricted Payments previously made with the Net
Cash Proceeds described in clauses (a) and (b) of this Section 4.04(b)(7);
provided, further, that the aggregate amount of Restricted Payments made pursuant to this
clause (7) shall not exceed $25.0 million in the aggregate;
(8) the declaration and payment of dividends to holders of any class or series of
Disqualified Stock of the Company issued in accordance with the terms of the Indenture to the
extent such dividends are included in the definition of “Consolidated Interest Expense”;
(9) repurchases of Capital Stock deemed to occur upon the exercise of stock options,
warrants, other rights to purchase Capital Stock or other convertible securities if such Capital
Stock represents a portion of the exercise price thereof;
(10) payments to fund regulatory capital, reinsurance or other requirements relating to the
Insurance Subsidiaries in the aggregate amount not to exceed $25.0 million from the Issue Date;
(11) the distribution, by dividend or otherwise, of shares of Capital Stock of Unrestricted
Subsidiaries (other than Unrestricted Subsidiaries the primary assets of which are cash and/or cash
equivalents);
(12) any Restricted Payment of up to an amount equal to the Net Cash Proceeds of any
disposition of any Unrestricted Asian Subsidiaries or any Insurance Subsidiaries; and
(13) other Restricted Payments in an aggregate amount, when taken together with all other
Restricted Payments made pursuant to this clause (13) (as reduced by the amount of capital returned
from any such Restricted Payments that constituted Restricted
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Investments in the form of cash and Cash Equivalents (exclusive of items reflected in
Consolidated Net Income)) not to exceed $250.0 million;
provided, however, that at the time of and after giving effect to, any Restricted Payment permitted
under clauses (5), (7), (8), (11) and (12) of this Section 4.04(b), no Default shall have occurred
and be continuing or would occur as a consequence thereof.
(c) The amount of all Restricted Payments (other than cash) shall be the Fair Market Value on
the date of such Restricted Payment of the assets or securities proposed to be transferred or
issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to such
Restricted Payment. The amount of all Restricted Payments paid in cash shall be its face amount.
Not later than the date of making any Restricted Payment, the Company shall deliver to the Trustee
an Officers’ Certificate stating that such Restricted Payment is permitted and setting forth the
basis upon which the calculations required by this Section 4.04 were computed, together with a copy
of any fairness opinion or appraisal required by the Indenture.
(d) The Company shall not permit any Unrestricted Subsidiary to become a Restricted Subsidiary
except pursuant to the last sentence of the definition of “Unrestricted Subsidiary.” For purposes
of designating any Restricted Subsidiary as an Unrestricted Subsidiary or as an Excluded Project
Subsidiary, all outstanding Investments by the Company and its Restricted Subsidiaries (except to
the extent repaid) in the Subsidiary so designated shall be deemed to be Restricted Payments in an
amount determined as set forth in the definition of “Investment.” Such designation shall be
permitted only if a Restricted Payment in such amount would be permitted at such time and if such
Subsidiary otherwise meets the definition of an Unrestricted Subsidiary or Excluded Project
Subsidiary, as applicable. Unrestricted Subsidiaries shall not be subject to any of the restrictive
covenants set forth in Article IV.
SECTION 4.05. Limitation on Liens. The Company shall not, and shall not permit any
of its Restricted Subsidiaries to, directly or indirectly, create, Incur, assume or suffer to exist
any Lien (other than Permitted Liens) upon any of its property or assets (including Capital Stock
of Subsidiaries), or income or profits therefrom, or assign or convey any right to receive income
therefrom, whether owned on the Issue Date or acquired after that date, which Lien is securing any
Indebtedness, unless contemporaneously with the Incurrence of such Liens:
(1) in the case of Liens securing Subordinated Obligations or the Notes are secured by a Lien
on such property, assets or proceeds that is senior in priority to such Liens; or
(2) in all other cases, the Notes are equally and ratably secured or are secured by a Lien on
such property, assets or proceeds that is senior in priority to such Liens.
Any Lien created for the benefit of Holders pursuant to this covenant shall be automatically
and unconditionally released and discharged upon the release and discharge of each of the Liens
described in clauses (1) and (2) of this Section 4.05.
SECTION 4.06. Limitation on Sale/Leaseback Transactions. The Company shall not, and
shall not permit any of its Restricted Subsidiaries to, enter into any Sale/Leaseback Transaction
unless:
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(1) the Company or such Restricted Subsidiary could have Incurred Indebtedness in an amount
equal to the Attributable Indebtedness in respect of such Sale/Leaseback Transaction pursuant to
Section 4.03;
(2) the Company or such Restricted Subsidiary would be permitted to create a Lien on the
property subject to such Sale/Leaseback Transaction under Section 4.05; and
(3) if the Sale/Leaseback Transaction is an Asset Disposition and all of the conditions of
Section 4.08 (including the provisions concerning the application of Net Available Cash) are
satisfied with respect to such Sale/Leaseback Transaction, treating all of the consideration
received in such Sale/Leaseback Transaction as Net Available Cash for purposes of such Section
4.08.
SECTION 4.07. Offer to Repurchase upon Change of Control. (a) If a Change of Control
occurs, unless the Company has exercised its right to redeem all of the Notes as described under
Section 3.01, the Company shall make an offer to purchase all of the Notes (the “Change of Control
Offer”) at a purchase price in cash equal to 101% of the principal amount of the Notes plus accrued
and unpaid interest, if any, to the date of purchase (the “Change of Control Payment”) (subject to
the right of Holders of record on the relevant Record Date to receive interest due on an interest
payment date falling on or prior to the date of purchase). Within 30 days following any Change of
Control, unless the Company has exercised its right to redeem all of the Notes under Section 3.01,
the Company shall mail a notice of such Change of Control Offer to each Holder, with a copy to the
Trustee, stating:
(1) that a Change of Control Offer is being made and that all Notes properly tendered
pursuant to such Change of Control Offer will be accepted for purchase by the Company at a purchase
price in cash equal to 101% of the principal amount of such Notes plus accrued and unpaid interest,
if any, to the date of purchase (subject to the right of Holders of record on a Record Date to
receive interest on an Interest Payment Date);
(2) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the
date such notice is mailed) (the “Change of Control Payment Date”); and
(3) the procedures determined by the Company, consistent with the Indenture, that a Holder
must follow in order to have its Notes repurchased.
(b) On the Change of Control Payment Date, the Company shall, to the extent lawful:
(1) accept for payment all Notes or portions of Notes (of $2,000 or larger integral multiples
of $1,000 in excess thereof) properly tendered pursuant to the Change of Control Offer;
(2) deposit with the paying agent an amount equal to the Change of Control Payment in respect
of all Notes or portions of Notes so tendered; and
(3) deliver or cause to be delivered to the Trustee for cancellation the Notes so accepted
together with an Officers’ Certificate stating the aggregate principal amount of Notes or
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portions of Notes being purchased by the Company in accordance with the terms of this Section 4.07.
(c) The Paying Agent shall promptly mail to each Holder of Notes so tendered the Change of
Control Payment for such Notes, and the Trustee shall promptly authenticate and mail (or cause to
be transferred by book entry) to each Holder a new Note equal in principal amount to any
unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a
principal amount of $2,000 or integral multiples of $1,000 in excess thereof.
(d) If the Change of Control Payment Date is on or after a Record Date and on or before the
related Interest Payment Date, any accrued and unpaid interest to the Change of Control Payment
Date shall be paid on the relevant Interest Payment Date to the Person in whose name a Note is
registered at the close of business on such Record Date.
(e) The Change of Control provisions described in this Section 4.07 shall be applicable
whether or not any other provisions of the Indenture are applicable.
(f) Prior to making a Change of Control Payment, and as a condition to such payment (1) the
requisite holders of each issue of Indebtedness issued under an indenture or other agreement that
may be violated by such payment shall have consented to such Change of Control Payment being made
and waived the event of default, if any, caused by the Change of Control or (2) the Company shall
repay all outstanding Indebtedness issued under an indenture or other agreement that may be
violated by a Change of Control Payment or the Company shall offer to repay all such Indebtedness,
and make payment to the holders of such Indebtedness that accept such offer, and obtain waivers of
any event of default arising under the relevant indenture or other agreement from the remaining
holders of such Indebtedness.
(g) The Company shall not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of
Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under
such Change of Control Offer.
(h) The Company shall comply, to the extent applicable, with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws or regulations in connection with the
repurchase of Notes pursuant to a Change of Control Offer. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Second Supplemental Indenture, the
Company shall comply with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations described in this Second Supplemental Indenture by virtue of the
conflict.
SECTION 4.08. Asset Sales. (a) The Company shall not, and shall not permit any of
its Restricted Subsidiaries to, cause, make or suffer to exist any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration at
least equal to the Fair Market Value (such Fair Market Value to be determined
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as of the date of entering into a contractual agreement for such Asset Disposition) of the
shares and assets subject to such Asset Disposition;
(2) at least 75% of the consideration from such Asset Disposition received by the Company or
such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied
by the Company or such Restricted Subsidiary, as the case may be, within 365 days from the later of
the date of such Asset Disposition or the receipt of such Net Available Cash, as follows:
(a) to permanently reduce (and permanently reduce commitments with respect
thereto): (x) obligations under the Senior Credit Facility or (y) Secured
Indebtedness of the Company (other than any Disqualified Stock or Subordinated
Obligations) or Secured Indebtedness of a Restricted Subsidiary (other than any
Disqualified Stock) (in each case other than Indebtedness owed to the Company or an
Affiliate of the Company);
(b) to permanently reduce obligations under other Indebtedness of the Company
(other than any Disqualified Stock or Subordinated Obligations) or Indebtedness of a
Restricted Subsidiary (other than any Disqualified Stock), in each case other than
Indebtedness owed to the Company or an Affiliate of the Company; provided that the
Company shall equally and ratably reduce Obligations under the Notes as provided
under Section 3.01, through open market purchases (to the extent such purchases are
at or above 100% of the principal amount thereof) or by making an offer (in
accordance with the procedures set forth in Section 4.08(b) for an Asset Disposition
Offer) to all Holders to purchase their Notes at 100% of the principal amount
thereof, plus the amount of accrued but unpaid interest on the amount of Notes that
would otherwise be prepaid; or
(c) to invest in Additional Assets;
provided that pending the final application of any such Net Available Cash in accordance with
clause (a), (b) or (c) of this Section 4.08(a)(3), the Company and its Restricted Subsidiaries may
temporarily reduce Indebtedness (including under a revolving Senior Credit Facility) or otherwise
invest such Net Available Cash in any manner not prohibited by the Indenture; provided further that
in the case of clause (c), a binding commitment to invest in Additional Assets shall be treated as
a permitted application of the Net Available Cash from the date of such commitment so long as the
Company or such other Restricted Subsidiary enters into such commitment with the good faith
expectation that such Net Available Cash will be applied to satisfy such commitment within 270 days
of such commitment (an “Acceptable Commitment”) and, in the event any Acceptable Commitment is
later cancelled or terminated for any reason before the Net Available Cash is applied in connection
therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a
“Second Commitment”) within 90 days of such cancellation or termination and with the good faith
expectation that such
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Net Available Cash will be applied within 180 days of such Second Commitment, it being understood
that if a Second Commitment is later cancelled or terminated for any reason before such Net
Available Cash is applied, then such Net Available Cash shall constitute Excess Proceeds.
For the purposes of clause (2) of this Section 4.08(a) and for no other purpose, the following
will be deemed to be cash:
(1) any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent
balance sheet) of the Company or any Restricted Subsidiary (other than liabilities that are by
their terms subordinated to the Notes) that are assumed by the transferee of any such assets and
from which the Company and all Restricted Subsidiaries have been validly released by all creditors
in writing;
(2) any securities, notes or other obligations received by the Company or any Restricted
Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into
cash (to the extent of the cash received) within 180 days following the closing of such Asset
Disposition; and
(3) any Designated Noncash Consideration received by the Company or any of its Restricted
Subsidiaries in such Asset Disposition having an aggregate Fair Market Value, taken together with
all other Designated Noncash Consideration received pursuant to this clause (3) that is at that
time outstanding, not to exceed the greater of (x) $100.0 million and (y) 2.5% of Total Tangible
Assets at the time of the receipt of such Designated Noncash Consideration (with the Fair Market
Value of each item of Designated Noncash Consideration being measured at the time received without
giving effect to subsequent changes in value).
(b) Any Net Available Cash from Asset Dispositions that are not applied or invested as
provided in Section 4.08(a) shall be deemed to constitute “Excess Proceeds.” On the 366th day after
an Asset Disposition, if the aggregate amount of Excess Proceeds exceeds $25.0 million, the Company
shall be required to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent
required by the terms of outstanding Pari Passu Indebtedness, to all holders of such Pari Passu
Indebtedness, to purchase the maximum aggregate principal amount of Notes and any such Pari Passu
Indebtedness that may be purchased out of the Excess Proceeds, at an offer price in cash in an
amount equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to
the date of purchase (subject to the right of Holders of record on a Record Date to receive
interest on the relevant Interest Payment Date), in accordance with the procedures set forth in the
Indenture or the agreements governing the Pari Passu Indebtedness, as applicable, in each case in
denominations of $2,000 and larger integral multiples of $1,000 in excess thereof. The Company
shall commence an Asset Disposition Offer with respect to Excess Proceeds by mailing (or otherwise
communicating in accordance with the procedures of DTC) the notice required pursuant to the terms
of the Indenture, with a copy to the Trustee. To the extent that the aggregate amount of Notes and
Pari Passu Indebtedness validly tendered and not properly withdrawn pursuant to an Asset
Disposition Offer is less than the Excess Proceeds, the Company may use any remaining Excess
Proceeds for general corporate purposes, subject to other covenants contained in the Indenture. If
the aggregate principal
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amount of Notes surrendered by Holders thereof and other Pari Passu Indebtedness surrendered by
holders or lenders, collectively, exceeds the amount of Excess Proceeds, the Trustee shall select
the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the
aggregate accreted value or principal amount of tendered Notes and Pari Passu Indebtedness. Upon
completion of such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(c) The Asset Disposition Offer shall remain open for a period of 20 Business Days following
its commencement, except to the extent that a longer period is required by applicable law (the
“Asset Disposition Offer Period”). No later than five Business Days after the termination of the
Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Company shall apply all
Excess Proceeds to the purchase of the aggregate principal amount of Notes and, if applicable, Pari
Passu Indebtedness (on a pro rata basis, if applicable) required to be purchased pursuant to this
Section 4.08 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer
Amount of Notes (and, if applicable, Pari Passu Indebtedness) has been so validly tendered, all
Notes and Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
Payment for any Notes so purchased shall be made in the same manner as interest payments are made.
(d) If the Asset Disposition Purchase Date is on or after a Record Date and on or before the
related Interest Payment Date, any accrued and unpaid interest shall be paid to the Person in whose
name a Note is registered at the close of business on such Record Date.
(e) On or before the Asset Disposition Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount
of Notes and Pari Passu Indebtedness or portions thereof validly tendered and not properly
withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer
Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Indebtedness
so tendered, in the case of integral multiples of $1,000; provided that if, following repurchase of
a portion of a Note, the remaining principal amount of such Note outstanding immediately after such
repurchase would be less than $2,000, then the portion of such Note so repurchased shall be reduced
so that the remaining principal amount of such Note outstanding immediately after such repurchase
is $2,000. The Company shall deliver, or cause to be delivered, to the Trustee the Notes so
accepted and an Officers’ Certificate stating the aggregate principal amount of Notes or portions
thereof so accepted and that such Notes or portions thereof were accepted for payment by the
Company in accordance with the terms of this Section 4.08.
(f) The Company shall deliver all certificates and notes required, if any, by the agreements
governing the Pari Passu Indebtedness. The Paying Agent or the Company, as the case may be, shall
promptly, but in no event, later than five Business Days after termination of the Asset Disposition
Offer Period, mail or deliver to each tendering Holder or holder or lender of Pari Passu
Indebtedness, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu
Indebtedness so validly tendered and not properly withdrawn by such holder or lender, as the case
may be, and accepted by the Company for purchase, and the Company shall promptly issue a new Note,
and the Trustee, upon delivery of an authentication order from the
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Company, shall authenticate and mail or deliver (or cause to be transferred by book-entry) such new
Note to such Holder (it being understood that, notwithstanding anything in this Second Supplemental
Indenture to the contrary, no Opinion of Counsel or Officers’ Certificate shall be required for the
Trustee to authenticate and mail or deliver such new Note) in a principal amount equal to any
unpurchased portion of the Note surrendered; provided that each such new Note shall be in a
principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the
Company shall take any and all other actions required by the agreements governing the Pari Passu
Indebtedness. Any Note not so accepted shall be promptly mailed or delivered by the Company to the
Holder thereof. The Company shall publicly announce the results of the Asset Disposition Offer on
the Asset Disposition Purchase Date.
(g) The Company shall comply, to the extent applicable, with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws or regulations in connection with the
repurchase of Notes pursuant to an Asset Disposition Offer. To the extent that the provisions of
any securities laws or regulations conflict with provisions of this Second Supplemental Indenture,
the Company shall comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Second Supplemental Indenture by virtue of any
conflict.
SECTION 4.09. Limitation on Restrictions on Distributions from Restricted
Subsidiaries. (a) The Company shall not, and shall not permit any Restricted Subsidiary (other
than Excluded Project Subsidiaries) to, directly or indirectly, create or otherwise cause or permit
to exist or become effective any consensual encumbrance or consensual restriction on the ability of
any Restricted Subsidiary (other than Excluded Project Subsidiaries) to:
(1) pay dividends or make any other distributions on its Capital Stock to the Company or any
of its Restricted Subsidiaries (other than Excluded Project Subsidiaries), or with respect to any
other interest or participation in, or measured by, its profits, or pay any Indebtedness or other
obligations owed to the Company or any Restricted Subsidiary (other than Excluded Project
Subsidiaries) (it being understood that the priority of any Preferred Stock in receiving dividends
or liquidating distributions prior to dividends or liquidating distributions being paid on Common
Stock shall not be deemed a restriction on the ability to make distributions on Capital Stock);
(2) make any loans or advances to the Company or any Restricted Subsidiary (other than
Excluded Project Subsidiaries) (it being understood that the subordination of loans or advances
made to the Company or any Restricted Subsidiary to other Indebtedness Incurred by the Company or
any Restricted Subsidiary shall not be deemed a restriction on the ability to make loans or
advances); or
(3) sell, lease or transfer any of its property or assets to the Company or any Restricted
Subsidiary (other than any Excluded Project Subsidiary) (it being understood that such transfers
shall not include any type of transfer described in clause (1) or (2) above).
(b) Section 4.09(a) shall not prohibit encumbrances or restrictions existing under or by
reason of:
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(1) contractual encumbrances or restrictions pursuant to the Senior Credit Facility and
related documentation and other agreements or instruments in effect at or entered into on the Issue
Date;
(2) the Indenture and the Notes;
(3) any agreement or other instrument of a Person acquired by the Company or any of its
Restricted Subsidiaries in existence at the time of such acquisition (but not created in
contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person and its Subsidiaries, or the property or
assets of the Person and its Subsidiaries, so acquired (including after-acquired property);
(4) any amendment, restatement, modification, renewal, supplement, refunding, replacement or
refinancing of an agreement referred to in clauses (1), (2) or (3) of this Section 4.09(b) or this
clause (4); provided, however, that such amendments, restatements, modifications, renewals,
supplements, refundings, replacements or refinancings are, in the good faith judgment of the
Company, no more restrictive than the encumbrances and restrictions contained the agreements
referred to in clauses (1), (2) or (3) of this Section 4.09(b) on the Issue Date or the date such
Restricted Subsidiary became a Restricted Subsidiary or was merged into a Restricted Subsidiary,
whichever is applicable;
(5) in the case of Section 4.09(a)(3), Liens permitted to be Incurred under Section 4.05 that
limit the right of the debtor to dispose of the assets securing such Indebtedness;
(6) purchase money obligations for property acquired in the ordinary course of business and
Capitalized Lease Obligations permitted under the Indenture, in each case, that impose encumbrances
or restrictions of the nature described in Section 4.09(a)(3) on the property so acquired;
(7) contracts for the sale of assets, including customary restrictions with respect to a
Subsidiary of the Company pursuant to an agreement that has been entered into for the sale or
disposition of all or a portion of the Capital Stock or assets of such Subsidiary;
(8) restrictions on cash or other deposits or net worth imposed by customers under contracts
entered into in the ordinary course of business;
(9) any customary provisions in joint venture agreements relating to joint ventures that are
not Restricted Subsidiaries and other similar agreements entered into in the ordinary course of
business;
(10) any customary provisions in leases, subleases or licenses and other agreements entered
into by the Company or any Restricted Subsidiary in the ordinary course of business; and
(11) encumbrances or restrictions arising or existing by reason of applicable law or any
applicable rule, regulation or order.
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SECTION 4.10. Limitation on Affiliate Transactions. (a) The Company shall not, and
shall not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or
conduct any transaction (including the purchase, sale, lease or exchange of any property or asset
or the rendering of any service) with any Affiliate of the Company (an “Affiliate Transaction”), if
such Affiliate Transaction or series of related Affiliate Transactions involve aggregate
consideration in excess of $5.0 million, unless:
(1) the terms of such Affiliate Transaction are no less favorable to the Company or such
Restricted Subsidiary, as the case may be (as reasonably determined by the Company), than those
that could have been obtained by the Company or such Restricted Subsidiary in a comparable
transaction at the time of such transaction in dealings with a Person that is not an Affiliate;
(2) in the event such Affiliate Transaction involves an aggregate consideration in excess of
$50.0 million, the terms of such transaction have been approved by a majority of the members of the
Board of Directors of the Company and by a majority of the members of such Board of Directors
having no personal stake in such transaction, if any (and such majority or majorities, as the case
may be, determines that such Affiliate Transaction satisfies the criteria in clause (1) of this
Section 4.10(a)); and
(3) in the event such Affiliate Transaction involves an aggregate consideration in excess of
$75.0 million, the Company has received a written opinion from an Independent Financial Advisor
that such Affiliate Transaction is fair from a financial point of view.
(b) Section 4.10(a) shall not apply to:
(1) any transaction that is in the ordinary course of business and consistent with past
practice between the Company or a Restricted Subsidiary and any Insurance Subsidiary or
Unrestricted Asian Subsidiary;
(2) any transaction involving the provision of services or the supply of goods or equipment
between the Company or a Restricted Subsidiary and a Joint Venture in which the Company and/or a
Restricted Subsidiary has a material ownership interest that is entered into in the ordinary course
of business consistent with past practices of the Company and/or any of its Restricted
Subsidiaries;
(3) any transaction between the Company and a Restricted Subsidiary (other than a Receivables
Entity) or between Restricted Subsidiaries (other than a Receivables Entity or Receivables
Entities) and any Guarantees issued by the Company or a Restricted Subsidiary for the benefit of
the Company or a Restricted Subsidiary, as the case may be, in accordance with Section 4.03;
(4) any Investment (other than a Permitted Investment) or other Restricted Payment, in each
case permitted to be made pursuant to Section 4.04 (but only to the extent included in the
calculation of the amount of Restricted Payments);
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(5) any issuance of securities or other payments, awards or grants in cash, securities or
otherwise pursuant to, or as the funding of, employment agreements and other compensation
arrangements, options to purchase Capital Stock of the Company, restricted stock plans, long-term
incentive plans, stock appreciation rights plans, participation plans or similar employee benefits
plans and/or indemnity or insurance provided on behalf of current or former officers and employees
pursuant to any plans approved by the Board of Directors of the Company;
(6) the payment of reasonable and customary fees paid to and any indemnity and insurance
provided on behalf of (x) current or former directors of the Company and any Restricted Subsidiary
and (y) current or former directors of any Unrestricted Subsidiary provided such fees, indemnity or
insurance are similar in scope to those provided in clause (x);
(7) loans or advances to employees, officers or directors of the Company or any Restricted
Subsidiary in the ordinary course of business, in an aggregate amount not in excess of $10.0
million (without giving effect to the forgiveness of any such loan);
(8) any agreement as in effect as of the Issue Date, as such agreement may be amended,
modified, supplemented, extended or renewed from time to time, so long as the terms of such
agreement as so amended, modified, supplemented, extended or renewed are not more disadvantageous
to the Holders in any material respect, when taken as a whole, than the terms of such agreement in
effect on the Issue Date; provided that if such amendment, modification, supplement, extension or
renewal involves an aggregate consideration in excess of $50.0 million, the terms thereof have been
approved by the Board of Directors;
(9) any agreement between any Person and an Affiliate of such Person existing at the time such
Person is acquired by or merged into the Company or a Restricted Subsidiary; provided that such
agreement was not entered into contemplation of such acquisition or merger, and any amendment
thereto (so long as any such agreement as so amended is not disadvantageous to the Holders, when
taken as a whole, as compared to the applicable agreement as in effect on the date of such
acquisition or merger, provided that if such amendment involves an aggregate consideration in
excess of $50.0 million, the terms thereof have been approved by the Board of Directors);
(10) transactions with customers, clients, suppliers, joint venture partners or purchasers or
sellers of goods or services, in each case in the ordinary course of the business of the Company
and its Restricted Subsidiaries and otherwise in compliance with the terms of the Indenture;
provided that in the reasonable determination of the Board of Directors or Senior Management of the
Company, such transactions are on terms that are no less favorable to the Company or the relevant
Restricted Subsidiary than those that could have been obtained at the time of such transactions in
a comparable transaction by the Company or such Restricted Subsidiary with an unrelated Person;
(11) any issuance or sale of Capital Stock (other than Disqualified Stock) to Affiliates of
the Company and the granting of registration and other customary rights in connection therewith;
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(12) sales or other transfers or dispositions of accounts receivable and other related assets
customarily transferred in an asset securitization transaction involving accounts receivable to a
Receivables Entity in a Qualified Receivables Transaction, and acquisitions of Permitted
Investments in connection with a Qualified Receivables Transaction;
(13) transactions in which the Company or any Restricted Subsidiary delivers to the Trustee a
letter from an Independent Financial Advisor stating that such transaction is fair to the Company
or such Restricted Subsidiary from a financial point of view or stating that the terms are not
materially less favorable than those that could have been obtained by the Company or such
Restricted Subsidiary in a comparable transaction at such time on an arms-length basis from a
Person that is not an Affiliate; and
(14) transactions between and among Excluded Project Subsidiaries.
SECTION 4.11. Payments for Consent.The Company shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for
the benefit of any Holder for or as an inducement to any consent, waiver or amendment of any of the
terms or provisions of the Indenture or the Notes unless such consideration is offered to be paid
and is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or amendment.
SECTION 4.12. Limitation on Company Activities. The Company shall not conduct,
transfer or otherwise engage in any business or operations other than the operation of Similar
Businesses through its direct and indirect Subsidiaries, activities incidental thereto and other
activities to the extent permitted by, and in compliance with, the Senior Credit Facility.
ARTICLE 5
CONSOLIDATION, MERGER AND SALE OF ASSETS
SECTION 5.01. When Company May Merge or Transfer Assets. Section 5.1 of the
Original Indenture is hereby amended and restated with respect to the Notes (but not with respect
to any other series of Securities) as follows:
“(a) The Company shall not consolidate with or merge with or into or wind up into (whether or
not the Company is the surviving corporation), or sell, assign, convey, transfer, lease or
otherwise dispose of all or substantially all of its properties and assets, in one or more related
transactions, to any Person unless:
(1) the resulting, surviving or transferee Person (the “Successor Company”) is a Person (other
than an individual) organized and existing under the laws of the United States of America, any
state or territory thereof, or the District of Columbia;
(2) the Successor Company (if other than the Company) expressly assumes all of the obligations
of the Company under the Notes and the Indenture pursuant to a supplemental indenture or other
documents or instruments in form reasonably satisfactory to the Trustee;
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(3) immediately after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing;
(4) immediately after giving pro forma effect to such transaction and any related financing
transactions, as if such transactions had occurred at the beginning of the applicable four-quarter
period,
(a) the Successor Company would be able to Incur at least $1.00 of additional
Indebtedness pursuant to Section 4.03, or
(b) the Consolidated Coverage Ratio for the Successor Company and its
Restricted Subsidiaries would be no less than such ratio for the Company and its
Restricted Subsidiaries immediately prior to such transaction; and
(5) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, winding up or disposition, and such
supplemental indenture, if any, comply with the Indenture.
(b) Notwithstanding Section 5.01(a)(3) and 5.01(a)(4),
(1) any Restricted Subsidiary may consolidate with, merge with or into or transfer all or part
of its properties and assets to the Company so long as no Capital Stock of the Restricted
Subsidiary is distributed to any Person other than the Company; provided that, in the case of a
Restricted Subsidiary that merges into the Company, the Company shall not be required to comply
with Section 5.01(a)(5); and
(2) the Company may merge with an Affiliate of the Company solely for the purpose of
reincorporating the Company in another state or territory of the United States or the District of
Columbia, so long as the amount of Indebtedness of the Company and its Restricted Subsidiaries is
not increased thereby.
For purposes of this Section 5.01, the sale, assignment, conveyance, transfer, lease or other
disposition of all or substantially all of the properties and assets of one or more Subsidiaries of
the Company, which properties and assets, if held by the Company instead of such Subsidiaries,
would constitute all or substantially all of the properties and assets of the Company on a
consolidated basis, will be deemed to be the disposition of all or substantially all of the
properties and assets of the Company.”
SECTION 5.02. Successor Corporation Substituted. Section 5.2 of the Original
Indenture is hereby amended and restated with respect to the Notes (but not with respect to any
other series of Securities) as follows:
“The Company will be released from its obligations under the Indenture and the Successor
Company will succeed to, and be substituted for, and may exercise every right and power of, the
Company under the Indenture and such Notes; provided that, in the case of a lease
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of all or substantially all its assets, the Company shall not be released from the obligation to pay the
principal of and interest on the Notes.”
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. Solely with respect to the Notes, Section 6.1
of the Original Indenture shall be amended and restated in its entirety by inserting the following
in lieu thereof:
“Event of Default”, wherever used in the Indenture with respect to the Notes, shall mean any
one of the following events:
(1) default in any payment of interest or on any Note when due, continued for 30 days;
(2) default in the payment of principal of or premium, if any, on any Note when due at its
Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or otherwise;
(3) failure by the Company to comply with its obligations under Section 5.01;
(4) failure by the Company to comply for 30 days after notice as provided below with any of
their obligations under Sections 4.01, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11 and
4.12 (in each case, other than (a) a failure to purchase Notes which constitutes an Event of
Default under clause (2) above, (b) a failure to comply with Section 5.01 which constitutes an
Event of Default under clause (3) above or (c) a failure to comply with Section 4.01 or Section
4.11 which constitutes an Event of Default under clause (5) below);
(5) failure by the Company to comply for 60 days after notice as provided below with its other
agreements contained in this Second Supplemental Indenture or the Notes;
(6) default under any mortgage, indenture or instrument under which there is issued or by
which there is secured or evidenced any Indebtedness for money borrowed by the Company or any of
its Restricted Subsidiaries (or the payment of which is Guaranteed by the Company or any of its
Restricted Subsidiaries), other than Indebtedness owed to the Company or a Restricted Subsidiary,
whether such Indebtedness or Guarantee now exists, or is created after the Issue Date, which
default:
(a) is caused by a failure to pay principal of, or interest or premium, if any,
on such Indebtedness prior to the expiration of the grace period provided in such
Indebtedness; or
(b) results in the acceleration of such Indebtedness prior to its maturity;
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and, in each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a payment
default or the maturity of which has been so accelerated, aggregates $30.0 million
or more (or its foreign currency equivalent); provided, that this clause (6) shall
not apply to Non-Recourse Debt of the Company or any of its Subsidiaries (except to
the extent that the Company or any of its Restricted Subsidiaries that are not
parties to such Non-Recourse Debt becomes directly or indirectly liable, including
pursuant to any contingent obligation for any such Non-Recourse Debt and such
liability, which individually or in the aggregate, exceeds $30.0 million);
(7) failure by the Company or any Significant Subsidiary (or any group of Restricted
Subsidiaries that, taken together (as of the date of the latest audited consolidated financial
statements of the Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary) to pay final judgments aggregating in excess of $30.0 million (or its foreign currency
equivalent) (net of any amounts that a reputable and creditworthy insurance company has
acknowledged liability for in writing), which judgments are not paid, discharged or stayed for a
period of 60 days or more after such judgment becomes final and non-appealable; or
(8) the entry by a court having jurisdiction in the premises of:
(a) a decree or order for relief in respect of the Company or any Significant
Subsidiary in an involuntary case or proceeding under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law; or
(b) a decree or order adjudging the Company or any Significant Subsidiary a
bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of the
Company or any Significant Subsidiary under any applicable federal or state law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or any Significant Subsidiary or of any
substantial part of its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief or any such
other decree or order unstayed and in effect for a period of 60 consecutive days; or
(9) the commencement by the Company or any Significant Subsidiary of a voluntary case or
proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other
similar laws or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Company to the entry of a decree or order for
relief in respect of the Company or any Significant Subsidiary in an involuntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law
or to the commencement of any bankruptcy or insolvency case or proceeding against the Company or
any Significant Subsidiary, or the filing by the Company or any Significant Subsidiary of a
petition or answer or consent seeking reorganization or relief under any applicable federal or
state law, or the consent by the Company or any Significant Subsidiary
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to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or any Significant
Subsidiary or of any substantial part of the property of the Company or any Significant Subsidiary,
or the making by the Company or any Significant Subsidiary of an assignment for the benefit of
creditors, or the admission by the Company or any Significant Subsidiary in writing of its
inability to pay its debts generally as they become due, or the taking of corporate action by the
Company or any Significant Subsidiary in furtherance of any such action.
Notwithstanding the foregoing, a default under Section 6.01(4) and (5) shall not constitute an
Event of Default until the Trustee or the Holders of 25% in principal amount of the then
outstanding Notes notify the Company of the default and the Company does not cure such default
within the time specified in Section 6.01(4) and (5) after receipt of such notice.”
SECTION 6.02. Acceleration of Maturity; Rescission and Annulment. Solely with
respect to the Notes, Section 6.2 of the Original Indenture shall be amended and restated in its
entirety by inserting the following in lieu thereof:
“If an Event of Default (other than an Event of Default described in Section 6.01(8) or (9)
hereof) occurs and is continuing, the Trustee by written notice to the Company, specifying the
Event of Default, or the Holders of at least 25% in principal amount of the then outstanding Notes
by written notice to the Company and the Trustee, may, and the Trustee at the written request of
such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if
any, on all the Notes to be due and payable. Upon such a declaration, such principal, premium, if
any, and accrued and unpaid interest, if any, will be due and payable immediately. In the event of
a declaration of acceleration of the Notes because an Event of Default described in Section 6.01(6)
has occurred and is continuing, the declaration of acceleration of the Notes shall be automatically
annulled if the default triggering such Event of Default pursuant to Section 6.01(6) shall be
remedied or cured by the Company or a Restricted Subsidiary or waived by the holders of the
relevant Indebtedness within 20 days after the declaration of acceleration with respect thereto and
if (1) the annulment of the acceleration of the Notes would not conflict with any judgment or
decree of a court of competent jurisdiction and (2) all existing Events of Default, except
nonpayment of principal, premium, if any, or interest on the Notes that became due solely because
of the acceleration of the Notes, have been cured or waived. If an Event of Default described in
Section 6.01(8) or (9) occurs and is continuing, the principal of, premium, if any, and accrued and
unpaid interest, if any, on all the Notes will become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holders. The Holders of a majority
in principal amount of the outstanding Notes may waive all past defaults (except with respect to
nonpayment of principal, premium or interest) and rescind any such acceleration with respect to the
Notes and its consequences if (1) rescission would not conflict with any judgment or decree of a
court of competent jurisdiction and (2) all existing Events of Default, other than the nonpayment of the principal of,
premium, if any, and interest on the Notes that have become due solely by such declaration of
acceleration, have been cured or waived.”
SECTION 6.03. Limitation on Suits. Solely with respect to the Notes, Section 6.7 of
the Original Indenture shall be amended and restated in its entirety by inserting the following in
lieu thereof:
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“Except to enforce the right to receive payment of principal, premium, if any, or interest
when due, no Holder may pursue any remedy with respect to the Indenture or the Notes unless:
(1) such Holder has previously given the Trustee written notice that an Event of Default is
continuing;
(2) Holders of at least 25% in principal amount of the then outstanding Notes have requested
the Trustee to pursue the remedy;
(3) such Holders have offered the Trustee security or indemnity satisfactory to the Trustee
against any loss, liability or expense;
(4) the Trustee has not complied with such request within 60 days after the receipt of the
request and the offer of security or indemnity; and
(5) the Holders of a majority in principal amount of the then outstanding Notes have not given
the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such request
within such 60-day period.
Notwithstanding any other provision of this Second Supplemental Indenture and any provision of
any Notes, the right of any Holder to receive payment of the principal of and accrued interest on
Notes, on or after the respective due dates expressed in such Notes or in the event of redemption
or repurchase, or to institute suit for the enforcement of any such payment on or after such
respective dates against the Company shall not be impaired or affected without the consent of such
Holder.”
ARTICLE 7
NOTICE OF DEFAULTS
SECTION 7.01. Notice of Defaults. (a) Solely with respect to the Notes, Section 7.5 of
the Original Indenture shall be amended and restated in its entirety by inserting the following in
lieu thereof:
“If a Default occurs and is continuing and is actually known to the Trustee, the Trustee shall
mail to each Holder notice of the Default within 90 days after it occurs. Except in the case of a
Default in the payment of principal of, premium, if any, or interest on any Note, the Trustee may
withhold from the Holders notice of any continuing Default if the Trustee determines in good faith that withholding the notice is in the interests of the Holders. In
addition, the Company shall deliver to the Trustee, within 90 days after the end of each fiscal
year ending after the Issue Date, a certificate indicating whether the signers thereof, one of whom
shall be the principal executive officer, principal financial officer or principal accounting
officer, know of any Default that occurred during the previous year. The Company shall also deliver
to the Trustee, within 10 Business Days after the occurrence thereof, written notice of any events
which would constitute a Default, their status and what action the Company is taking or proposing
to take in respect thereof.”
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ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01. Discharge of Liability on Notes. (a) Solely with respect to the
Notes, Section 9.1 of the Original Indenture shall be amended and restated in its entirety by
inserting the following in lieu thereof:
“The Indenture shall be discharged and shall cease to be of further effect as to all Notes
issued hereunder, when either:
(1) all Notes that have been authenticated, except lost, stolen or destroyed Notes that have
been replaced or paid and Notes for whose payment money has been deposited in trust and thereafter
repaid to the Company, have been delivered to the Trustee for cancellation; or
(2) (a) all Notes not theretofore delivered to the Trustee for cancellation have
become due and payable by reason of the giving of a notice of redemption or
otherwise, will become due and payable within one year or may be called for
redemption within one year under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense, of
the Company, and the Company has irrevocably deposited or caused to be deposited
with the Trustee, as trust funds in trust solely for the benefit of the Holders,
cash in U.S. dollars, Government Securities, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants, without consideration of any reinvestment of
interest, to pay and discharge the entire Indebtedness on the Notes not theretofore
delivered to the Trustee for cancellation for principal, premium, if any, and
accrued interest to the date of maturity or redemption;
(b) no Default or Event of Default has occurred and is continuing on the date
of the deposit or will occur as a result of the deposit (other than a Default or an
Event of Default resulting from borrowing of funds to be applied to such deposit and
the grant of any Lien securing such borrowing) and the deposit will not result in a
breach or violation of, or constitute a default under, the Senior Credit Facility or
any other material agreement or instrument to which the Company is a party or by
which the Company is bound;
(c) the Company has paid or caused to be paid all sums payable by it under this
Second Supplemental Indenture; and
(d) the Company has delivered irrevocable written instructions to the Trustee
to apply the deposited money toward the payment of the Notes at maturity or the
redemption date, as the case may be.
The Company shall deliver an Officers’ Certificate and an Opinion of Counsel to the Trustee
stating that all conditions precedent to satisfaction and discharge have been satisfied.
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Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the
Company to the Trustee under Section 7.7 of the Original Indenture, and, if money shall have been
deposited with the Trustee pursuant to clause (2)(a) of this Section 8.01, the provisions of
Sections 2.4, 2.7, 2.8 and 9.2 of the Indenture, this Section 8.01 and Section 8.03 of this Second
Supplemental Indenture shall survive.”
SECTION 8.02. Defeasance. Solely with respect to the Notes, Section 9.3 of the
Original Indenture shall be amended and restated in its entirety by inserting the following in lieu
thereof:
“The Company may, at its option and at any time, elect to have all of its obligations
discharged with respect to the outstanding Notes except for:
(1) the rights of Holders to receive payments in respect of the principal of, premium, if any,
or interest on such Notes when such payments are due, solely out of the trust referred to below;
(2) the Company’s obligations with respect to the Notes concerning issuing temporary Notes,
registration of Notes, mutilated, destroyed, lost or stolen Notes and the maintenance of an office
or agency for payment and money for Note payments held in trust;
(3) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s
obligations in connection therewith; and
(4) the provisions of this Section 8.02.”
SECTION 8.03. Covenant Defeasance. Solely with respect to the Notes, Section 9.4 of
the Original Indenture shall be amended and restated in its entirety by inserting the following in
lieu thereof:
“The Company at any time may terminate its obligations under Sections 4.01, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.09, 4.10, 4.11 and 4.12 and the application of clauses (6) and (7) of Section
6.01, the application of clauses (8) and (9) of Section 6.01 with respect to Significant
Subsidiaries, and the limitations contained in clauses (4) and (5) of Section 5.01.”
SECTION 8.04. Conditions to Defeasance. The Company may exercise its option under
Section 8.02 or 8.03 if:
(1) the Company irrevocably deposits with the Trustee, in trust, for the benefit of the
Holders, cash in U.S. dollars, Government Securities, or a combination thereof, in amounts as will
be sufficient, in the opinion of a nationally recognized firm of independent public accountants
without consideration of any reinvestment of interest, to pay the principal of, and premium, if
any, and interest due on the outstanding Notes on the Stated Maturity or on the applicable
redemption date, as the case may be, and the Company specifies whether the Notes are being defeased
to maturity or to a particular redemption date;
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(2) in the case of the exercise of the option under Section 8.02, the Company has delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that (a) the
Company has received from, or there has been published by, the Internal Revenue Service a ruling,
or (b) since the Issue Date, there has been a change in the applicable U.S. federal income tax law,
in either case to the effect that, and based thereon such Opinion of Counsel will confirm that the
Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of
such legal defeasance and will be subject to U.S. federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such legal defeasance had not
occurred;
(3) in the case of the exercise of the option under Section 8.03, the Company has delivered to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to
customary assumptions and exclusions, the Holders will not recognize income, gain or loss for U.S.
federal income tax purposes as a result of such covenant defeasance and will be subject to U.S.
federal income tax on the same amounts, in the same manner and at the same times as would have been
the case if such covenant defeasance had not occurred;
(4) such exercise will not result in a breach or violation of, or constitute a default under
any material agreement or instrument (other than this Second Supplemental Indenture) to which the
Company or any of its Restricted Subsidiaries is a party or by which the Company or any of its
Restricted Subsidiaries is bound;
(5) no Default or Event of Default has occurred and is continuing on the date of such deposit
(other than a Default or an Event of Default resulting from the borrowing of funds to be applied to
make such deposit and any similar and simultaneous deposit relating to other Indebtedness and, in
each case, the granting of Liens in connection therewith) or insofar as Events of Default resulting
from the borrowing of funds or insolvency events are concerned, at any time in the period ending on
the 91st day after the date of deposit;
(6) the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that,
as of the date of such opinion and subject to customary assumptions and exclusions, including, that
no intervening bankruptcy of the Company between the date of deposit and the 91st day following the
deposit and assuming that no Holder is an “insider” of the Company under applicable bankruptcy law,
after the 91st day following the deposit, the trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization of similar laws affecting creditors’ rights
generally;
(7) the Company has delivered to the Trustee an Officers’ Certificate stating that the deposit
was not made by the Company with the intent of defeating, hindering, delaying or defrauding
creditors of the Company or others;
(8) the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions), each
stating that all conditions precedent to the exercise of the option under Section 8.02 or 8.03, as
the case may be, have been complied with; and
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(9) the Company has delivered irrevocable written instructions to the Trustee to apply the
deposited money toward the payment of the Notes at maturity or the redemption date, as the case may
be (which instructions may be contained in the Officers’ Certificate referred to in clause (8)
above).”
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Noteholders. Solely with respect to the Notes,
Section 10.1 of the Original Indenture shall be amended and restated in its entirety by inserting
the following in lieu thereof:
“The Company and the Trustee may amend this Second Supplemental Indenture or the Notes without
the consent of any Holder to:
(1) cure any ambiguity, omission, defect or inconsistency;
(2) provide for the assumption by a successor of the obligations of the Company under this
Second Supplemental Indenture in accordance with Section 5.01;
(3) provide for or facilitate the issuance of uncertificated Notes in addition to or in place
of certificated Notes; provided that the uncertificated Notes are issued in registered form for
purposes of Section 163(f) of the Code or in a manner such that the uncertificated Notes are
described in Section 163(f)(2)(B) of the Code;
(4) comply with the rules of any applicable Depositary;
(5) secure the Notes;
(6) add covenants of the Company and its Restricted Subsidiaries or Events of Default for the
benefit of Holders or to make changes that would provide additional rights to the Holders or to
surrender any right or power conferred upon the Company;
(7) make any change that does not adversely affect the legal rights under the Indenture of any
Holder;
(8) comply with any requirement of the SEC in connection with any required the qualification
of the Indenture under the Trust Indenture Act;
(9) evidence and provide for the acceptance of an appointment under the Indenture of a
successor trustee; provided that the successor trustee is otherwise qualified and eligible to act
as such under the terms of the Indenture;
(10) conform the text of this Second Supplemental Indenture or the Notes to any provision of
the section entitled “Description of notes” in the Prospectus Supplement to the
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extent that such provision in such section was intended to be a verbatim recitation of a provision of this Second
Supplemental Indenture or the Notes as confirmed in an Officer’s Certificate; or
(11) make any amendment to the provisions of this Second Supplemental Indenture relating to
the transfer and legending of Notes as permitted by this Second Supplemental Indenture, including,
without limitation to facilitate the issuance and administration of the Notes or, if Incurred in
compliance with this Second Supplemental Indenture, Additional Notes; provided, however, that (A)
compliance with this Second Supplemental Indenture as so amended would not result in Notes being
transferred in violation of the Securities Act or any applicable securities law and (B) such
amendment does not materially and adversely affect the rights of Holders to transfer Notes.”
SECTION 9.02. With Consent of Noteholders. Solely with respect to the Notes,
Section 10.2 of the Original Indenture shall be amended and restated in its entirety by inserting
the following in lieu thereof:
“Except as provided in this Section 9.02, the Indenture and the Notes may be amended or
supplemented with the consent of the Holders of a majority in principal amount of the Notes then
outstanding (including without limitation, consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes) and, subject to certain exceptions, any past default or
compliance with any provisions may be waived with the consent of the Holders of a majority in
principal amount of the Notes then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, Notes). However, without the
consent of each Holder of an outstanding Note affected, no amendment, supplement or waiver may,
among other things:
(1) reduce the principal amount of Notes whose Holders must consent to an amendment,
supplement or waiver;
(2) reduce the stated rate of interest or extend the stated time for payment of interest on
any Note;
(3) reduce the principal of or extend the Stated Maturity of any Note;
(4) waive a Default or Event of Default in the payment of principal of, premium, if any, or
interest on the Notes (except a rescission of acceleration of the Notes by the Holders of at least
a majority in aggregate principal amount of the then outstanding Notes with
respect to a nonpayment default and a waiver of the payment default that resulted from such
acceleration);
(5) reduce the premium payable upon the redemption or repurchase of any Note or change the
time at which any Note may be redeemed or repurchased as described under Sections 3.01, 4.07 or
4.08 hereof whether through an amendment or waiver of provisions in the covenants, definitions or
otherwise (except amendments to the definition of “Change of Control”);
(6) make any Note payable in money other than that stated in the Note;
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(7) impair the right of any Holder to receive payment of principal of, premium, if any, or
interest on such Holder’s Notes on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such Holder’s Notes; or
(8) make any change in the amendment or waiver provisions which require each Holder’s consent.
It shall not be necessary for the consent of the Noteholders under the Indenture to approve
the particular form of any proposed amendment, supplement or waiver. It shall be sufficient if such
consent approves the substance of the proposed amendment or supplement. A consent to any amendment,
supplement or waiver under the Indenture by any Holder given in connection with a tender of such
Xxxxxx’s Notes will not be rendered invalid by such tender. After an amendment, supplement or
waiver under the Indenture becomes effective, the Company shall be required to give to the Holders
a notice briefly describing such amendment, supplement or waiver. Notwithstanding the foregoing,
the failure to give such notice to all the Holders, or any defect in the notice shall not impair or
affect the validity of the amendment, supplement or waiver.
Any Notes held by the Company or an Affiliate of the Company shall be disregarded (from both
the numerator and the denominator) for purposes of determining whether the holders of the requisite
aggregate principal amount of the outstanding Notes have consented to or voted for a modification,
amendment or waiver of the terms of the Indenture.
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Second Supplemental Indenture Controls. This Second Supplemental
Indenture is executed by the Company, and by the Trustee upon the Company’s written request,
pursuant to the provisions of Section 2.2 of the Original Indenture, and the terms and conditions
of the Original Indenture shall be deemed to be part of this Second Supplemental Indenture for all
purposes. The Original Indenture, as supplemented and amended by this Second Supplemental
Indenture, is in all respects hereby adopted, ratified and confirmed. Notwithstanding the
foregoing, to the extent that any of the terms of this Second Supplemental Indenture are
inconsistent with, or conflict with, the terms of the Original Indenture, the terms of this Second
Supplemental Indenture shall govern.
SECTION 10.02. GOVERNING LAW. THIS SECOND SUPPLEMENTAL INDENTURE AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAWS PRICIPLES THEREOF.
SECTION 10.03. Successors. All agreements of the Company in this Second
Supplemental Indenture and the Notes shall bind its successors. All agreements of the Trustee in
this Second Supplemental Indenture shall bind its successors.
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SECTION 10.04. Multiple Originals. The parties may sign any number of copies of
this Second Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this Second Supplemental
Indenture. The exchange of copies of this Second Supplemental Indenture and of signature pages by
facsimile or PDF transmission shall constitute effective execution and delivery of this Second
Supplemental Indenture as to the parties hereto and may be used in lieu of the original Second
Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile
or PDF shall be deemed to be their original signatures for all purposes.
SECTION 10.05. Table of Contents; Headings. The table of contents, cross-reference
sheet and headings of the Articles and Sections of this Second Supplemental Indenture have been
inserted for convenience of reference only, are not intended to be considered a part hereof and
shall not modify or restrict any of the terms or provisions hereof.
SECTION 10.06. No Responsibility by Trustee. The Trustee assumes no responsibility
for the correctness of the recitals herein contained, which shall be taken as the statements of the
Company. The Trustee makes no representations and shall have no responsibility as to the validity
or sufficiency of this Second Supplemental Indenture or the due authorization and execution hereof
by the Company.
SECTION 10.07. Calculations. Except as otherwise provided herein, the Company shall
be responsible for making all calculations called for under this Second Supplemental Indenture and
the Notes. The Company or its agents will make all such calculations in good faith and, absent
manifest error, such calculations will be final and binding on Holders. The Company upon request
will provide a schedule of its calculations to each of the Trustee and the Conversion Agent, and
each of the Trustee and Conversion Agent is entitled to rely conclusively upon the accuracy of the
Company’s calculations without independent verification. The Trustee will deliver a copy of such
schedule to any Holder upon the written request of such Xxxxxx.
SECTION 10.08. No Guarantees. The Notes are not guaranteed by any Guarantor.
Accordingly, Article VIII of the Original Indenture shall not apply with respect to the Notes.
SECTION 10.09. No Sinking Fund. No sinking fund is provided for the Notes.
Accordingly, Article XII of the Original Indenture shall not apply with respect to the Notes.
SECTION 10.10. U.S.A. Patriot Act. The parties hereto acknowledge that in
accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions
and in order to help fight the funding of terrorism and money laundering, is required to
obtain, verify, and record information that identifies each person or legal entity that establishes
a relationship or opens an account with the Trustee. The parties to this Second Supplemental
Indenture agree that they will provide the Trustee with such information as it may request in order
for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.
SECTION 10.11. Force Majeure. In no event shall the Trustee be responsible or
liable for any failure or delay in the performance of its obligations hereunder arising out of or
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caused by, directly or indirectly, forces beyond its control, including, without limitation,
strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of
utilities, communications or computer (software and hardware) services; it being understood that
the Trustee shall use reasonable efforts which are consistent with accepted practices in the
banking industry to resume performance as soon as practicable under the circumstances.
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IN WITNESS WHEREOF, the parties have caused this Second Supplemental Indenture to be duly
executed as of the date first written above.
| COVANTA HOLDING CORPORATION, as Company |
||||
| By | /s/ Xxxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxx | |||
| Title: | Chief Executive Officer and President | |||
| XXXXX FARGO BANK, NATIONAL ASSOCIATION, as Trustee |
||||
| By | /s/ Xxxxxxx Xxxxx Xxxxx | |||
| Name: | Xxxxxxx Xxxxx Xxxxx | |||
| Title: | Vice President | |||
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EXHIBIT A
[FORM OF FACE OF NOTE]
[Global Note Legend]
[Global Note Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS 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.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH
IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
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| No. ____ | $____ |
CUSIP:
[ ]1
ISIN: [ ] 2
ISIN: [ ] 2
7.250% Senior Notes Due 2020
COVANTA HOLDING CORPORATION, a Delaware corporation, promises to pay to “Cede & Co.”, or
registered assigns, the principal sum of Dollars on December 1, 2020.
Interest Payment Dates: June 1 and December 1.
Record Dates: May 15 and November 15.
Additional provisions of this Note are set forth on the other side of this Note.
| 1 | CUSIP: 00000XXX0 | |
| 2 | ISIN: US22282EAD40 |
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IN WITNESS HEREOF, the Company has caused this instrument to be duly executed.
Dated:
,
20___
| COVANTA HOLDING CORPORATION, |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| By: | ||||
| Name: | ||||
| Title | ||||
TRUSTEE’S CERTIFICATE OF
AUTHENTICATION
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Trustee, certifies that this is one of the
Notes referred to in the Indenture.
Notes referred to in the Indenture.
| By: | ||||
| Authorized Signatory | ||||
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[FORM OF REVERSE SIDE OF NOTE]
7.250% Senior Note Due 2020
7.250% Senior Note Due 2020
Capitalized terms used herein shall have the meanings assigned to them in the Indenture
referred to below unless otherwise indicated.
1. INTEREST. Covanta Holding Corporation, a Delaware corporation (the “Company”),
promises to pay interest on the principal amount of this Note at 7.250% per annum from and
including December 1, 2010 until maturity. The Company shall pay interest semi-annually in arrears
on June 1 and December 1 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each, an “Interest Payment Date”). Interest on the Notes shall
accrue from the most recent date to which interest has been paid or, if no interest has been paid,
from and including December 1, 2010. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from
time to time on demand at the interest rate on the Notes; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace periods) from time to time on demand at the
interest rate on the Notes. Interest shall be computed on the basis of a 360-day year comprised of
twelve 30-day months.
2. METHOD OF PAYMENT. The Company shall pay interest on the Notes to the Persons who are
registered holders of Notes at the close of business on the May 15 or November 15 (whether or not a
Business Day), as the case may be, immediately preceding the related Interest Payment Date, even if
such Notes are canceled after such Record Date and on or before such Interest Payment Date, except
as provided in Section 2.04 of the Second Supplemental Indenture with respect to defaulted
interest. Principal, premium, if any, and interest on the Notes shall be payable at the office or
agency of the Company maintained for such purpose or, at the option of the Company, payment of
interest and premium, if any, may be made by check mailed to the Holders at their respective
addresses set forth in the Note Register; provided that payment by wire transfer of
immediately available funds shall be required with respect to principal, premium, if any, and
interest, on all Global Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent at least five Business Days prior to the
applicable payment date. Such payment shall be in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, Xxxxx Fargo Bank, National Association,
the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change
any Paying Agent or Registrar without notice to the Holders. The Company or any of its Restricted
Subsidiaries may act in any such capacity.
4. INDENTURE. The Company issued the Notes under an Indenture, dated as of January 18,
2007 (the “Original Indenture”), as supplemented by the Second Supplemental Indenture,
dated as of December 1, 2010 (the “Second Supplemental Indenture” and, together with the
Original Indenture as it may be amended or supplemented from time to time in accordance with its
terms, the “Indenture”), between the Company and the Trustee. This Note is one of a duly
authorized issue of notes of the Company designated as its 7.250% Senior Notes due 2020. The
Company shall be entitled to issue Additional Notes pursuant to Section 2.1 of the Original
Indenture and 2.01 of the Second Supplemental Indenture. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture
Act of 1939, as amended (the “Trust Indenture Act”). The Notes are subject to all such
terms, and Holders are referred to the Indenture and the Trust Indenture Act
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for a statement of such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture shall govern and be
controlling.
5. REDEMPTION AND REPURCHASE. (a) Prior to December 1, 2013, the Company may, at its option,
on any one or more occasions redeem up to 35% of the original aggregate principal amount of the
Notes (calculated after giving effect to any issuance of Additional Notes) with the Net Cash
Proceeds of one or more Equity Offerings at a redemption price equal to 107.25% of the aggregate
principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date (the
“Redemption Date”), subject to the right of Holders of record on a Record Date on or prior
to such Redemption Date to receive interest due on the Interest Payment Date; provided that:
(1) at least 65% of the original aggregate principal amount of the Notes
(calculated after giving effect to any issuance of Additional Notes) remains
outstanding after each such redemption; and
(2)
such redemption occurs within 90 days after the closing of such Equity
Offering.
(b) Prior to December 1, 2015, the Company may redeem the Notes, in whole but not in part, at
a redemption price equal to 100% of the aggregate principal amount of the Notes plus the Applicable
Premium, plus accrued and unpaid interest, if any, to the Redemption Date, subject to the right of
Holders of record on a Record Date on or prior to such Redemption Date to receive interest due on
the relevant Interest Payment Date.
(c) From and after December 1, 2015, the Company may redeem the Notes, in whole or in part, at
the redemption prices (expressed as a percentage of principal amount of the Notes to be redeemed)
set forth below, plus accrued and unpaid interest on the Notes, if any, to the applicable date of
redemption, (subject to the right of Holders of record on a Record Date on or prior to such
Redemption Date) to receive interest due on the relevant Interest Payment Date, if redeemed during
the twelve-month period beginning on December 1 of the years indicated below:
| Year | Percentage | |||
2015 |
103.625 | % | ||
2016 |
102.417 | % | ||
2017 |
101.208 | % | ||
2018 and thereafter |
100.000 | % | ||
6. SINKING FUND. The Company shall not be required to make any sinking fund payments with
respect to the Notes.
7. REPURCHASE AT THE OPTION OF THE HOLDERS UPON CHANGE OF CONTROL AND ASSET SALES. If a Change
of Control occurs, unless the Company has exercised its right to redeem all of the Notes as
described in the Indenture, the Company shall make a Change of Control Offer at a purchase price in
cash equal to 101% of the principal amount of the Notes plus accrued and unpaid interest, if any,
to the date of purchase (subject to the right of Holders of record on a Record Date on or prior to
the date of purchase to receive interest due on the relevant Interest Payment Date.
In accordance with Section 4.08 of the Second Supplemental Indenture, the Company will be
required to offer to purchase Notes upon the occurrence of certain events.
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8. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in
denominations of $2,000 and integral multiples of $1,000 in excess thereof. The transfer of Notes
may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer
documents, and Holders shall be required to pay any taxes and fees required by law or permitted by
the Indenture. The Company need not exchange or register the transfer of any Note or portion of a
Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part.
9. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner
for all purposes.
10. AMENDMENT AND SUPPLEMENT. The Indenture or the Notes may be amended or supplemented
as provided in the Indenture.
11. DEFAULTS AND REMEDIES. The Events of Default relating to the Notes are defined in Section
6.01 of the Second Supplemental Indenture. Upon the occurrence of an Event of Default, the rights
and obligations of the Company, the Trustee and the Holders shall be as set forth in the applicable
provisions of the Indenture.
11. AUTHENTICATION. This Note shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose until authenticated by the manual signature of the Trustee.
12. GOVERNING LAW. THIS NOTE WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARDS TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
13. XXXXX AND ISIN NUMBERS. Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP and ISIN numbers to be
printed on the Notes, and the Trustee may use CUSIP and ISIN numbers in notices of redemption as a
convenience to Holders. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without charge a copy of the
Indenture. Requests may be made to the Company at the following address:
Covanta Holding Corporation
00 Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Tel. No.: (000) 000-0000 Ext. 7001
Email: xxxxxxxxx@xxxxxxx.xxx
Attention: Investors Relations
00 Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Tel. No.: (000) 000-0000 Ext. 7001
Email: xxxxxxxxx@xxxxxxx.xxx
Attention: Investors Relations
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: |
||
| (Insert assignee’s legal name) |
(Insert assignee’s soc. sec. or tax I.D. no.)
(Print or type assignee’s name, address and zip code)
and irrevocably appoint |
||
| to transfer this Note on the books of the Company. The agent may substitute another to act for him. | ||
Date: _____________________
| Your Signature: | ||||
| (Sign exactly as your name appears on the face of this Note) |
Signature Guarantee*: ________________________
| * | Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). |
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant to Section 4.07 or
4.08 of the Second Supplemental Indenture, check the box:
o Section 4.07 o Section 4.08
If you want to elect to have only part of this Note purchased by the Company pursuant to
Section 4.07 or 4.08 of the Second Supplemental Indenture, state the amount in principal amount:
| $ | (integral multiples of $1,000, provided that the unpurchased | |||
| portion must be in a minimum principal amount of $2,000) |
Date: _____________________
| Your Signature: | ||||
| (Sign exactly as your name appears on the face of this Note) |
| Tax Identification No.: | ||||
Signature Guarantee*: ________________________
| * | Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee). |
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SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE*
The following increases or decreases in this Global
Note have been made:
Note have been made:
| Principal amount | Signature of | |||||||||||||||
| Amount of | Amount of | of this Global Note | authorized signatory | |||||||||||||
| decrease in | increase in | following such | of Trustee or | |||||||||||||
| principal amount | principal amount | decrease or | Securities | |||||||||||||
| Date of exchange | of this Global Note | of this Global Note | increase | Custodian | ||||||||||||
| * | This schedule should be included only if the Note is issued in global form. |
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