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EXHIBIT 4.4
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XXXX GAMING CORPORATION
9.50% Senior Subordinated Notes Due 2007
INDENTURE
Dated as of July 22, 0000
XXXXX XXXXXX BANK AND TRUST COMPANY,
Trustee
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- -------
310 (a)(1) ...........................................................7.10
(a)(2) ...........................................................7.10
(a)(3) ...........................................................N.A.
(a)(4) ...........................................................N.A.
(a)(5) ...........................................................7.10
(b) .....................................................7.08; 7.10
(c) ...........................................................N.A.
311 (a) ...........................................................7.11
(b) ...........................................................7.11
(c) ...........................................................N.A.
312 (a) ...........................................................2.05
(b) ..........................................................11.03
(c) ..........................................................11.03
313 (a) ...........................................................7.06
(b)(1) ...........................................................N.A.
(b)(2) ...........................................................7.06
(c) ..........................................................11.02
(d) ...........................................................7.06
314 (a) ..............................................4.03; 4.08; 11.02
(b) ...........................................................N.A.
(c)(1) ..........................................................11.04
(c)(2) ..........................................................11.04
(c)(3) ...........................................................N.A.
(d) ...........................................................N.A.
(e) ..........................................................11.05
(f) ...........................................................N.A.
315 (a) ...........................................................7.01
(b) ....................................................7.05; 11.02
(c) ...........................................................7.01
(d) ...........................................................7.01
(e) ...........................................................6.11
316 (a)(last sentence)....................................................2.07
(a)(1)(A).............................................................6.05
(a)(1)(B).............................................................6.04
(a)(2) ...........................................................N.A.
(b) ...........................................................6.07
(c) ...........................................................6.07
317 (a)(1) ...........................................................6.08
(a)(2) ...........................................................6.09
(b) ...........................................................2.04
318 (a) ..........................................................11.01
N.A. means Not Applicable.
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Note: This Cross-Reference Table shall not, for any purpose, be deemed to
be part of this Indenture.
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TABLE OF CONTENTS
ARTICLE I Page
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Definitions and Incorporation by Reference
SECTION 1.01. Definitions ................................................. 1
SECTION 1.02. Other Definitions ........................................... 23
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act ............................................ 24
SECTION 1.04. Rules of Construction........................................ 24
ARTICLE II
The Securities
SECTION 2.01. Form and Dating ............................................. 25
SECTION 2.02. Execution and Authentication................................. 25
SECTION 2.03. Registrar and Paying Agent................................... 26
SECTION 2.04. Paying Agent To Hold Money in
Trust.................................................... 27
SECTION 2.05. Securityholder Lists......................................... 27
SECTION 2.06. Replacement Securities....................................... 27
SECTION 2.07. Outstanding Securities....................................... 28
SECTION 2.08. Temporary Securities......................................... 28
SECTION 2.09. Cancelation.................................................. 29
SECTION 2.10. Defaulted Interest........................................... 29
SECTION 2.11. Record Date.................................................. 30
SECTION 2.12. Computation of Interest...................................... 30
SECTION 2.13. CUSIP Numbers................................................ 30
ARTICLE III
Redemption
SECTION 3.01. Notices to Trustee .......................................... 31
SECTION 3.02. Selection of Securities to Be
Redeemed ................................................ 31
SECTION 3.03. Notice of Redemption ........................................ 31
SECTION 3.04. Effect of Notice of Redemption............................... 32
SECTION 3.05. Deposit of Redemption Price.................................. 33
SECTION 3.06. Securities Redeemed in Part ................................. 33
SECTION 3.07. Redemption Pursuant to Gaming
Laws...................................................... 33
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Page
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ARTICLE IV
Covenants
SECTION 4.01. Certain Suspended Covenants............................... 34
SECTION 4.02. Payment of Securities..................................... 34
SECTION 4.03. SEC Reports............................................... 35
SECTION 4.04. Limitation on Indebtedness................................ 35
SECTION 4.05. Limitation on Restricted
Payments.............................................. 37
SECTION 4.06. Limitation on Transactions with
Affiliates............................................ 39
SECTION 4.07. Change of Control......................................... 40
SECTION 4.08. Compliance Certificate.................................... 42
SECTION 4.09. Further Instruments and Acts.............................. 42
SECTION 4.10. Limitation on Liens....................................... 42
SECTION 4.11. Limitation on Dividend and Other
Payment Restrictions Affecting
Restricted Subsidiaries............................... 43
SECTION 4.12. Limitation on Asset Sales; Event of
Loss.................................................. 43
SECTION 4.13. Limitation on Layered Indebtedness ....................... 47
SECTION 4.14. Maintenance of Properties and Other
Matters............................................... 47
SECTION 4.15. Limitation on Activities of the
Company............................................... 48
SECTION 4.16. Agreement to Redeem the CHFC Notes ....................... 48
ARTICLE V
Successor Company
SECTION 5.01. When Company May Merge or Transfer
Assets................................................ 49
ARTICLE VI
Defaults and Remedies
SECTION 6.01. Events of Default......................................... 50
SECTION 6.02. Acceleration.............................................. 52
SECTION 6.03. Other Remedies............................................ 53
SECTION 6.04. Waiver of Past Defaults................................... 53
SECTION 6.05. Control by Majority....................................... 53
SECTION 6.06. Limitation on Suits....................................... 54
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Page
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SECTION 6.07. Rights of Holders To Receive
Payment............................................... 54
SECTION 6.08. Collection Suit by Trustee................................ 54
SECTION 6.09. Trustee May File Proofs of
Claim................................................. 54
SECTION 6.10. Priorities................................................ 55
SECTION 6.11. Undertaking for Costs..................................... 55
SECTION 6.12. Waiver of Stay or Extension
Laws.................................................. 56
ARTICLE VII
Trustee
SECTION 7.01. Duties of Trustee......................................... 56
SECTION 7.02. Rights of Trustee......................................... 57
SECTION 7.03. Individual Rights of Trustee.............................. 58
SECTION 7.04. Trustee's Disclaimer...................................... 58
SECTION 7.05. Notice of Defaults........................................ 58
SECTION 7.06. Reports by Trustee to Holders............................. 58
SECTION 7.07. Compensation and Indemnity................................ 59
SECTION 7.08. Replacement of Trustee.................................... 60
SECTION 7.09. Successor Trustee by Merger............................... 61
SECTION 7.10. Eligibility; Disqualification............................. 61
SECTION 7.11. Preferential Collection of Claims
Against Company....................................... 61
SECTION 7.12. Trustee's Application for
Instructions from the Company......................... 62
ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securities;
Defeasance............................................ 62
SECTION 8.02. Conditions to Defeasance.................................. 63
SECTION 8.03. Application of Trust Money................................ 65
SECTION 8.04. Repayment to Company...................................... 65
SECTION 8.05. Indemnity for Government Obligations...................... 65
SECTION 8.06. Reinstatement............................................. 65
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Page
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ARTICLE IX
Amendments
SECTION 9.01. Without Consent of Holders................................ 66
SECTION 9.02. With Consent of Holders................................... 66
SECTION 9.03. Compliance with Trust Indenture
Act................................................... 67
SECTION 9.04. Revocation and Effect of Consents and
Waivers............................................... 67
SECTION 9.05. Notation on or Exchange of
Securities............................................ 68
SECTION 9.06. Trustee To Sign Amendments................................ 68
SECTION 9.07. Payment for Consent....................................... 69
ARTICLE X
Subordination
SECTION 10.01. Agreement To Subordinate ................................. 69
SECTION 10.02. Liquidation, Dissolution, Bankruptcy ..................... 70
SECTION 10.03. Default on Senior Indebtedness ........................... 70
SECTION 10.04. Acceleration of Payment of
Securities............................................ 71
SECTION 10.05. When Distribution Must Be Paid Over....................... 71
SECTION 10.06. Subrogation............................................... 71
SECTION 10.07. Relative Rights........................................... 72
SECTION 10.08. Subordination May Not Be Impaired by
Company............................................... 72
SECTION 10.09. Rights of Trustee and Paying Agent ....................... 72
SECTION 10.10. Distribution or Notice to
Representative........................................ 73
SECTION 10.11. Article X Not To Prevent Events of
Default or Limit Right To
Accelerate ........................................... 73
SECTION 10.12. Trust Moneys Not Subordinated ............................ 73
SECTION 10.13. Trustee Entitled To Rely ................................. 73
SECTION 10.14. Trustee To Effectuate
Subordination ........................................ 74
SECTION 10.15. Trustee Not Fiduciary for Holders of
Senior Indebtedness .................................. 74
SECTION 10.16. Reliance by Holders of Senior
Indebtedness on Subordination
Provisions ........................................... 74
SECTION 10.17 Certain Payments.......................................... 75
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ARTICLE XI
Miscellaneous
SECTION 11.01. Trust Indenture Act Controls.............................. 75
SECTION 11.02. Notices................................................... 75
SECTION 11.03. Communication by Holders with Other
Holders.............................................. 76
SECTION 11.04. Certificate and Opinion as to
Conditions Precedent................................. 76
SECTION 11.05. Statements Required in Certificate or
Opinion.............................................. 76
SECTION 11.06. Rules by Trustee, Paying Agent and
Registrar............................................ 77
SECTION 11.07. Legal Holidays............................................ 77
SECTION 11.08. GOVERNING LAW............................................. 77
SECTION 11.09. No Recourse Against Others................................ 77
SECTION 11.10. Successors................................................ 77
SECTION 11.11. Multiple Originals........................................ 78
SECTION 11.12. Table of Contents; Headings............................... 78
SECTION 11.13. Severability.............................................. 78
Appendix A - Provisions Relating to Initial Securities and
Exchange Securities
Exhibit 1 to
Appendix A - Form of Initial Security
Exhibit A - Form of Exchange Security
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INDENTURE dated as of July 22, 1997, among XXXX GAMING
CORPORATION, a Nevada corporation (the "Company"), and STATE
STREET BANK AND TRUST COMPANY, a Massachusetts banking
corporation (the "Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Company's 9.50% Senior
Subordinated Notes Due July 15, 2007 (the "Initial Securities") and, if and when
issued pursuant to a registered exchange for the Initial Securities, the
Company's 9.50% Senior Subordinated Notes Due July 15, 2007 (the "Exchange
Securities" and together with the Initial Securities, the "Securities"):
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Additional Assets" means (i) any Property (other than cash, cash
equivalents or securities) to be owned by the Company or a Restricted Subsidiary
and used in a Related Business, (ii) the costs of improving, restoring,
replacing or developing any Property owned by the Company or a Restricted
Subsidiary which is used in a Related Business or (iii) Investments in any other
Person engaged primarily in a Related Business (including the acquisition from
third parties of Capital Stock of such Person) as a result of which such other
Person becomes a Restricted Subsidiary in compliance with the procedure for
designation of Restricted Subsidiaries set forth below in the definition of
"Restricted Subsidiary".
"Affiliate" means, with respect to any Person, a Person (i) which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such Person, (ii) which directly
or indirectly through one or more intermediaries beneficially owns or holds 10%
or more of any class of the Voting Stock of such Person (or a 10% or greater
equity interest in a Person which is not a corporation) or (iii) of which 10% or
more of any class of the Voting Stock (or, in the case of a Person which is not
a corporation, 10% or more of the equity interest) is beneficially owned or held
directly or indirectly through one or more intermediaries by such
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Person. The term "control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.
"Asset Sale" means the sale, conveyance, transfer, lease or other
disposition, whether in a single transaction or a series of related transactions
(including, without limitation, dispositions pursuant to Sale/Leaseback
Transactions or pursuant to the merger of the Company or any of its Restricted
Subsidiaries with or into any Person other than the Company or one of its
Restricted Subsidiaries, but not including any dispositions to the Company or
any of its Restricted Subsidiaries), by the Company or one of its Restricted
Subsidiaries to any Person other than the Company or one of its Restricted
Subsidiaries of (i) any of the Capital Stock or other ownership interests of any
Subsidiary of the Company or (ii) any other Property of the Company or any
Property of its Restricted Subsidiaries, in each case not in the ordinary course
of business of the Company or such Restricted Subsidiary.
"Attributable Indebtedness" means Indebtedness deemed to be Incurred
in respect of a Sale/Leaseback Transaction and shall be, at the date of
determination, the present value (discounted at the actual rate of interest
implicit in such transaction, compounded annually), 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).
"Average Life" means, as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i)
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 multi
plied by the amount of such payment by (ii) the sum of all such payments.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors,
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to be in full force and effect on the date of such certification and delivered
to the Trustee.
"Xxxx Family" means Xxxxxxx X. Xxxx, any direct descendant or spouse
of such person, or any direct descendant of such spouse, and any trust or other
estate in which each person who has a beneficial interest, directly or
indirectly through one or more intermediaries, in Capital Stock of the Company
is one of the foregoing persons.
"Xxxx Notes" means the Company's 9.25% Senior Notes Due 2003 issued
pursuant to the Indenture dated as of October 4, 1996, between the Company and
The Bank of New York, a New York banking corporation.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligations" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP. For purposes of Section 4.10, Capital Lease Obligations shall be
deemed secured by a Lien on the Property being leased.
"Capital Stock" means, with respect to any Person, any and all
shares or other equivalents (however designated) of corporate stock, partnership
interests or any other participation, right, warrants, options or other interest
in the nature of an equity interest in such Person, but excluding any debt
security convertible or exchangeable into such equity interest.
"Change of Control" means the occurrence of any of the following
events: (i) any "person" or "group" (within the meaning of Sections 13(d)(3) and
14(d)(2) of the Exchange Act or any successor provision to either of the
foregoing, including any group acting for the purpose of acquiring, holding or
disposing of securities within the meaning of Rule 13d-5(b)(1) under the
Exchange Act), other than the Permitted Holders and other than a Restricted
Subsidiary, becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time) of 50%
or more of the total voting power of all classes of the Voting Stock of the
Company and/or warrants
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or options to acquire such Voting Stock, calculated on a fully diluted basis;
provided that for purposes of this clause (i), the members of the Xxxx Family
shall be deemed to beneficially own any Voting Stock of a corporation held by
any other corporation (the "parent corporation") so long as the members of the
Xxxx Family beneficially own (as so defined), directly or indirectly through one
or more intermediaries, in the aggregate 50% or more of the total voting power
of the Voting Stock of the parent corporation; (ii) the sale, lease, conveyance
or other transfer of all or substantially all of the Property of the Company
(other than to any Restricted Subsidiary); (iii) the stockholders of the Company
shall have approved any plan of liquidation or dissolution of the Company; (iv)
the Company consolidates with or merges into another Person or any Person
consolidates with or merges into the Company in any such event pursuant to a
transaction in which the outstanding Voting Stock of the Company is reclassified
into or exchanged for cash, securities or other property, other than any such
transaction where (a) the outstanding Voting Stock of the Company is
reclassified into or exchanged for Voting Stock of the surviving corporation
that is Capital Stock and (b) the holders of the Voting Stock of the Company
immediately prior to such transaction own, directly or indirectly, not less than
a majority of the Voting Stock of the surviving corporation immediately after
such transaction in substantially the same proportion as before the transaction;
or (v) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors (together with any
new directors whose election or appointment by such board or whose nomination
for election by the stockholders of the Company was approved by a vote of either
(A) 66 2/3% of the directors then still in office who were either directors at
the beginning of such period or whose election or nomination for election was
previously so approved or (B) members of the Xxxx Family who beneficially own
(as defined for purposes of clause (i) above), directly or indirectly through
one or more intermediaries, in the aggregate 50% or more of the total voting
power of the Voting Stock of the Company) cease for any reason to constitute a
majority of the Board of Directors then in office.
"Change of Control Time" means the earlier of the public
announcement of (x) a Change of Control or (y) (if applicable) the intention of
the Company to effect a Change of Control.
"Change of Control Triggering Event" means both a Change of Control
and a Rating Decline with respect to the
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Securities; provided, however, that a Change of Control Triggering Event shall
not be deemed to have occurred if (i) at the Change of Control Time the
Securities have Investment Grade Status and (ii) the Company effects defeasance
of the Securities pursuant to the provisions of Article VIII prior to a Rating
Decline.
"CH&C" means California Hotel and Casino, a Nevada corporation.
"CHFC Indenture" means the Indenture dated October 15, 1992, among
CHFC, CH&C and State Street Bank and Trust Company, a Massachusetts banking
corporation.
"CHFC Notes" means the 11% Senior Subordinated Notes Due 2002 issued
pursuant to the CHFC Indenture.
"CHFC" means California Hotel Finance Corporation, a Nevada
corporation.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission.
"Consolidated EBITDA" means, for any period, without duplication,
Consolidated Net Income, plus (i) Consolidated Fixed Charges, (ii) provisions
for taxes based on income to the extent such taxes were deducted in determining
Consolidated Net Income, (iii) consolidated depreciation expense, (iv)
consolidated amortization expense, and (v) other noncash items reducing
Consolidated Net Income, minus (vi) other noncash items increasing Consolidated
Net Income, all as determined on a consolidated basis for the Company and its
Restricted Subsidiaries in conformity with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means the ratio of (i)
Consolidated EBITDA during the Reference Period to (ii) the aggregate amount of
Consolidated Fixed Charges during the Reference Period.
"Consolidated Fixed Charges" means, for any period, the total
interest expense of the Company and its consolidated Subsidiaries (other than
Unrestricted Subsidiaries), including (i) the interest component of Capital
Lease Obligations, (ii) one-third of the rental expense attributable to
operating leases, (iii) amortization of Indebtedness discount and commissions,
discounts and
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other similar fees and charges owed with respect to Indebtedness, (iv) noncash
interest payments, (v) commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing, (vi) net
costs pursuant to Interest Rate Agreements, (vii) dividends on all Preferred
Stock of Restricted Subsidiaries held by Persons other than the Company or a
Restricted Subsidiary, (viii) interest attributable to the Indebtedness of any
other Person for which the Company or any Restricted Subsidiary is responsible
or liable as obligor, guarantor or otherwise (including Indebtedness Guaranteed
pursuant to Investment Guarantees) and (viii) any dividend or distribution,
whether in cash, property or securities, on Disqualified Stock of the Company.
"Consolidated Net Income" means for any period, the net income
(loss) of the Company and its Subsidiaries; provided, however, that there shall
not be included in such Consolidated Net Income (i) any net income (loss) of any
Person if such Person is not a Restricted Subsidiary, except that subject to the
limitations contained in (iv) below, (a) 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 (iii) 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, (ii) any net income (loss) of any Person acquired by
the Company or a Subsidiary in a pooling of interests transaction for any period
prior to the date of such acquisition, (iii) any net income (loss) of any
Restricted Subsidiary if such Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of distributions, directly
or indirectly, to the Company, except that (a) subject to the limitations
contained in (iv) 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
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Subsidiary for such period shall be included in determining such Consolidated
Net Income, (iv) any gain or loss realized upon the sale or other disposition of
any Property of the Company or its consolidated Subsidiaries (including pursuant
to any Sale/Leaseback Transaction) which is not sold or otherwise disposed of in
the ordinary course of business and any gain or loss realized upon the sale or
other disposition of any Capital Stock of any Person, (v) any extraordinary gain
or loss and (vi) the cumulative effect of a change in accounting principles.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP, as of the end of the most recent
fiscal quarter of the Company ending at least 45 days prior to the taking of any
action for the purpose of which the determination is being made, as (i) the par
or stated value of all outstanding Capital Stock of the Company plus (ii)
paid-in capital or capital surplus relating to such Capital Stock plus (iii) any
retained earnings or earned surplus less (A) any accumulated deficit and (B) any
amounts attributable to Disqualified Stock.
"Credit Facility" means the revolving credit facility, as amended
from time to time, among the Company, certain Subsidiaries and a syndicate of
banks, and any extensions, revisions, refinancings or replacements thereof by an
institutional lender or syndicate of institutional lenders.
"Currency Exchange Protection Agreement" means, in respect of a
Person, any foreign exchange contract, currency swap agreement, currency option
or other similar agreement or arrangement designed to protect such Person
against fluctuations in currency exchange rates.
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default; provided, however, that a Default
with respect to any event referred to in clause (iv) of the definition of "Event
of Default" shall not be deemed to occur until the Company has received written
notice of such event from the Trustee or Holders of not less than 25% in
aggregate principal amount of the Securities then outstanding.
"Designated Senior Indebtedness" means any Senior Indebtedness of
the Company which, at the date of determination, has an aggregate principal
amount outstanding of, or under which at the date of determination the holders
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thereof are committed to lend up to, at least $25 million and is specifically
designated by the Company in the instrument evidencing or governing such Senior
Indebtedness as "Designated Senior Indebtedness" for purposes hereof.
"Disqualified Stock" of a Person means any Capital Stock of such
Person: (i) that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) or otherwise (a) matures or is
mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (b)
is or may become redeemable or repurchaseable at the option of the holder
thereof, in whole or in part, or (c) is convertible or exchangeable or
exercisable for Indebtedness; and (ii) as to which the maturity, mandatory
redemption, conversion or exchange or redemption at the option of the holder
thereof occurs, or may occur, in the case of each of clauses (i) or (ii) on or
prior to the first anniversary of the Stated Maturity of the Securities;
provided, however, that such Capital Stock of the Company or any of its
Subsidiaries shall not constitute Disqualified Stock if it is redeemable prior
to the first anniversary of the Stated Maturity of the Securities only if: (A)
the holder or a beneficial owner of such Capital Stock is required to qualify
under the Gaming Laws and does not so qualify, or (B) the Board of Directors
determines in its reasonable, good faith judgment, as evidenced by a Board
Resolution, that as a result of a holder or beneficial owner owning such Capital
Stock, the Company or any of its Subsidiaries has lost or may lose any Gaming
License, which if lost or not reinstated, as the case may be, would have a
material adverse effect on the business of the Company and its Subsidiaries,
taken as a whole, or would restrict the ability of the Company or any of its
Subsidiaries to conduct business in any gaming jurisdiction.
"Event of Loss" means, with respect to any Property, any (i) loss,
destruction or damage of such Property; or (ii) any condemnation, seizure or
taking, by exercise of the power of eminent domain or otherwise, of such
Property, or confiscation or requisition of the use of such Property.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Fair Market Value" means with respect to any Property, the price
which could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction. Fair
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Market Value will be determined, except as otherwise provided, (i) if such
Property has a Fair Market Value of less than $5 million, by any Officer or (ii)
if such Property has a Fair Market Value in excess of $5 million, by a majority
of the Board of Directors and evidenced by a Board Resolution, dated within 30
days of the relevant transaction, delivered to the Trustee.
"GAAP" means generally accepted accounting principles in effect on
the date of this Indenture, including those set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
approved by a significant segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP consistently applied.
"Gaming Authority" means any of the Nevada Gaming Commission, the
Nevada Gaming Control Board, the Mississippi Gaming Commission, the Mississippi
State Tax Commission, the Missouri Gaming Commission, the National Indian Gaming
Commission, the Bureau of Indian Affairs, the Illinois Gaming Board and any
other agency (including, without limitation, any agency established by a
federally-recognized Indian tribe to regulate gaming on such tribe's
reservation) which has, or may at any time after the date of this Indenture
have, jurisdiction over the gaming activities of the Company or any of its
Subsidiaries or any successor to such authority.
"Gaming Facility" means any gaming establishment and other property
or assets directly ancillary thereto or used in connection therewith, including
any building, restaurant, hotel, theater, parking facilities, retail shops,
land, golf courses and other recreation and entertainment facilities, vessel,
barge, ship and equipment or 100% of the equity interest of a Person the primary
business of which is ownership and operation of any of the foregoing.
"Gaming Laws" means the gaming laws of a jurisdiction or
jurisdictions to which the Company or any of its Subsidiaries is, or may at any
time after the date of this Indenture be, subject.
"Gaming License" means any license, permit, franchise or other
authorization from any Governmental
17
10
Authority required on the date of this Indenture or at any time thereafter to
own, lease, operate or otherwise conduct the gaming business of the Company and
its Subsidiaries, including all licenses granted under Gaming Laws and other
Legal Requirements.
"Governmental Authority" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
any governmental or quasi-governmental unit, whether Federal, state, county,
district, city or other political subdivision, foreign or otherwise and whether
now or hereafter in existence, or any officer or official of any thereof,
including any Gaming Authority.
"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 first
Person (i) 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 agreements to keep-well, to purchase assets,
goods, securities or services, to take-or-pay or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring in any
other manner the obligee of such Indebtedness or other obligation 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" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered on the Registrar's books.
"Incur" means, with respect to any Indebtedness or other obligation
of any Person, to create, issue, incur (by conversion, exchange or otherwise),
extend, assume, Guarantee or become liable in respect of such Indebtedness or
other obligation or the recording, as required pursuant to GAAP or otherwise, of
any such Indebtedness or obligation on the consolidated balance sheet of such
Person including by merger or operation of law (and "Incurrence", "Incurred",
"Incurrable" and "Incurring" shall have meanings correlative to the foregoing).
The accretion of principal of a noninterest bearing or other discount security
shall be deemed the Incurrence of Indebtedness.
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"Indebtedness" means (without duplication), with respect to any
Person, any indebtedness, secured or unsecured, contingent or otherwise, which
is for borrowed money (whether or not the recourse of the lender is to the whole
of the assets of such Person or only to a portion thereof), or the principal
amount of such indebtedness evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any property (excluding any balances that constitute customer advance
payments and deposits, accounts payable or trade payables, and other accrued
liabilities arising in the ordinary course of business) if and to the extent any
of the foregoing indebtedness would appear as a liability upon a balance sheet
of such Person prepared in accordance with GAAP, and shall also include, to the
extent not otherwise included (i) any Capital Lease Obligations, (ii)
Indebtedness of other Persons secured by a Lien to which the Property or assets
owned or held by such Person is subject, whether or not the obligation or
obligations secured thereby shall have been assumed (the amount of such
Indebtedness being deemed to be the lesser of the value of such Property or
assets or the amount of the Indebtedness so secured), (iii) Guarantees of
Indebtedness of other Persons, (iv) any Disqualified Stock, (v) any Attributable
Indebtedness, (vi) all obligations of such Person in respect of letters of
credit, bankers' acceptances or other similar instruments or credit transactions
issued for the account of such Person (including reimbursement obligations with
respect thereto), other than obligations with respect to letters of credit
securing obligations (other than obligations described in this definition)
entered into in the ordinary course of business of such Person to the extent
such letters of credit are not drawn upon or, if and to the extent drawn upon,
such drawing is reimbursed no later than the third Business Day following
receipt by such Person of a demand for reimbursement following payment on the
letter of credit, (vii) in the case of the Company, Preferred Stock of its
Restricted Subsidiaries and (viii) obligations pursuant to any Interest Rate
Agreement or Currency Rate Protection Agreement. Notwithstanding the foregoing,
Indebtedness shall not include any interest or accrued interest until due and
payable. For purposes of this definition, the maximum fixed repurchase price of
any Disqualified Stock or Preferred Stock that does not have a fixed repurchase
price shall be calculated in accordance with the terms of such Disqualified
Stock or Preferred Stock as if such Disqualified Stock or Preferred Stock were
repurchased on any date on which Indebtedness shall be required to be determined
pursuant to this Indenture; provided, however, that if such Disqualified Stock
or Preferred Stock is not
19
12
then permitted to be repurchased, the repurchase price shall be the book value
of such Disqualified Stock or Preferred Stock. The amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of any
other obligations described in clauses (i) through (viii) above in respect
thereof at such date.
"Indenture" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the TIA that are deemed to be a part of and govern
this instrument, and any such supplemental indenture, respectively.
"Independent Advisor" means an investment banking firm of national
standing with noninvestment-grade debt underwriting experience or any third
party appraiser of national standing; provided, however, that such firm or
appraiser is not an Affiliate of the Company.
"Interest Rate Agreement" means, for any Person, any interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement or
other similar agreement.
"Investment" by any Person means any direct or indirect loan,
advance or other extension of credit or capital contribution (by means of
transfers of cash or other Property to others or payments for Property or
services for the account or use of others, or otherwise) to, or Incurrence of an
Investment Guarantee or a Guarantee of any obligation of, or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Indebtedness issued by, any other Person, including the
redesignation by the Board of Directors of a Person to be an Unrestricted
Subsidiary. In determining the amount of any Investment in respect of any
Property other than cash, such Property shall be valued at its Fair Market Value
at the time of such Investment.
"Investment Grade Rating" means a rating equal to or higher than
Baa3 (or the equivalent) by Moody's (or any successor to the rating agency
business thereof), BBB- (or the equivalent) by S&P (or any successor to the
rating agency business thereof) and BBB- (or the equivalent) by Duff & Xxxxxx
Credit Rating Co. (or any successor to the rating agency business thereof).
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13
"Investment Grade Status" means any time at which the ratings of the
Securities by two of the three Rating Agencies are Investment Grade Ratings;
provided, however, that one of such two must be Moody's or S&P.
"Investment Guarantee" means any Guarantee by the Company or a
Restricted Subsidiary of Indebtedness of a Permitted Joint Venture; provided
such Guarantee complies with the requirements of clause (vii) of Section
4.05(b); provided further that only such Indebtedness of such Permitted Joint
Venture Guaranteed by the Company or a Restricted Subsidiary that matures by its
terms prior to the time (if any) that the ability of the Company or a Restricted
Subsidiary to control the day-to-day operations of such Permitted Joint Venture
(pursuant to a management contract or otherwise) is scheduled to expire may
constitute Indebtedness subject to an Investment Guarantee.
"Issue Date" means the date on which the Securities are initially
issued.
"Legal Requirements" means all laws, statutes and ordinances and all
rules, orders, rulings, regulations, directives, decrees, injunctions and
requirements of all Governmental Authorities, that are now or may hereafter be
in existence, and that may be applicable to the Company or any Subsidiary or
Affiliate thereof or the Trustee (including building codes, zoning and
environmental laws, regulations and ordinances and Gaming Laws), as modified by
any variances, special use permits, waivers, exceptions or other exemptions
which may form time to time be applicable.
"Lien" means with respect to any Property of any Person, any
mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement (other than any easement
not materially impairing usefulness or marketability), encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such Property (including any Capital
Lease Obligation, conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing). Any
Sale/Leaseback Transaction shall be deemed to constitute a Lien on the Property
which is the subject of such Sale/Leaseback Transaction securing the
Attributable Indebtedness represented thereby.
"Material Gaming Facility" means any Gaming Facility owned, leased
or operated by the Company or any
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14
Subsidiary or Permitted Joint Venture which generated more than 10% of
Consolidated EBITDA during the Reference Period or represented more than 10% of
the book value of the Company's consolidated assets as of the date of the most
recent balance sheet prepared by the Company.
"Mirage Joint Venture" means the joint venture pursuant to that
certain Joint Venture Agreement dated as of May 29, 1996, by and between MAC,
CORP., a New Jersey corporation which is a wholly-owned subsidiary of Mirage
Resorts, Incorporated, a Nevada corporation, and Grand K, Inc., a Nevada
corporation which is a wholly-owned subsidiary of the Company.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Cash Proceeds" with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale, net of attorney's fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually Incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Net Proceeds" from any Asset Sale or Event of Loss by any Person or
its Restricted Subsidiaries means cash and cash equivalents received in respect
of the Property sold or with respect to which an Event of Loss occurred net of
(i) all reasonable out-of-pocket expenses of such Person or such Restricted
Subsidiary Incurred in connection with an Asset Sale of such type, including,
without limitation, all legal, title and recording tax expenses, commissions and
fee and expenses incurred (but excluding any finder's fee or broker's fee
payable to any Affiliate of such Person) and all Federal, state, provincial,
foreign and local taxes arising in connection with such Asset Sale or Event of
Loss that are paid or required to be accrued as a liability under GAAP by such
Person or its Restricted Subsidiaries, (ii) all payments made by such Person or
its Restricted Subsidiaries on any Indebtedness which is secured by such
Property in accordance with the terms of any Lien upon or with respect to such
Property or which must, by the terms of such Lien, or in order to obtain a
necessary consent to such Asset Sale or by applicable law, be repaid out of the
proceeds from such Asset Sale or Event of Loss and (iii) all contractually
required distributions and other payments made to minority interest holders (but
excluding distributions and payments to Affiliates of such Person) in Restricted
Subsidiaries of such Person as a result of such Asset Sale or Event of Loss;
provided, however, that, in the event that any consideration
22
15
for an Asset Sale (which would otherwise constitute Net Proceeds) is required to
be held in escrow pending determination of whether a purchase price adjustment
will be made, such consideration (or any portion thereof) shall become Net
Proceeds only at such time as it is released to such Person or its Restricted
Subsidiaries from escrow; and provided further, however, that any noncash
consideration received in connection with an Asset Sale or Event of Loss which
is subsequently converted to cash shall be deemed to be Net Proceeds at and from
the time of such conversion.
"Non-Recourse Indebtedness" means Indebtedness of a Person to the
extent that under the terms thereof or pursuant to applicable law (i) no
personal recourse shall be had against such Person for the payment of the
principal of or interest or premium, if any, on such Indebtedness, and (ii)
enforcement of obligations on such Indebtedness is limited only to recourse
against interests in Property purchased with the proceeds of the Incurrence of
such Indebtedness and as to which neither the Company nor any of its Restricted
Subsidiaries provides any credit support or is liable.
"Officer" means the Chief Executive Officer, President, the
Treasurer, or any Executive Vice President or Vice President of the Company.
"Officers' Certificate" means a certificate signed by two Officers
at least one of whom shall be the principal executive officer, principal
accounting officer or principal financial officer 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.
"Permitted FF&E Financing" means Indebtedness of the Company or any
of its Restricted Subsidiaries that is Incurred to finance the acquisition or
lease after the date of this Indenture of newly acquired or leased furniture,
fixtures or equipment ("FF&E") used directly in the operation of a Gaming
Facility owned or leased by the Company or its Restricted Subsidiaries and
secured by a Lien on such FF&E in an amount not to exceed 100% of the cost of
the FF&E so purchased or leased.
"Permitted Holders" means the Xxxx Family and any group (as such
term is used in Sections 13(d) and 14(d) of
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the Exchange Act) comprised solely of members of the Xxxx Family.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) a Restricted Subsidiary or a Person which will,
upon the making of such Investment, become a Restricted Subsidiary; provided,
however, that the primary business of such Restricted Subsidiary is a Related
Business; (ii) another Person if as a result of such Investment such other
Person is merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, the Company or a Restricted Subsidiary;
provided, however, that such Person's primary business is a Related Business;
(iii) Temporary Cash Investments; (iv) receivables owing to the Company or any
Restricted Subsidiary, if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; 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; (v) 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;
(vi) loans or advances to employees made in the ordinary course of business
consistent with past practices of the Company or such Restricted Subsidiary, as
the case may be; (vii) stock, obligations or securities received in settlement
of debts created in the ordinary course of business and owing to the Company or
any Restricted Subsidiary or in satisfaction of judgments; and (viii) securities
received pursuant to clause (ii) of Section 4.12(a).
"Permitted Joint Venture" means a Person in which a Permitted Joint
Venture Investment has been made by the Company or any Restricted Subsidiary.
"Permitted Joint Venture Investment" means any Investment in a
Person primarily engaged or preparing to engage in a Related Business if,
immediately after giving effect to such Investment, the Company or a Restricted
Subsidiary will own at least 50.0% of the shares of Capital Stock (including at
least 50.0% of the total voting power thereof) of such Person, and will control
the day-to-day operations of such Person pursuant to a management contract or
otherwise.
"Permitted Liens" means (i) Liens for taxes, assessments or
governmental charges or levies on the
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17
Property of the Company if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good faith and
by appropriate proceedings; (ii) Liens imposed by law, such as carriers',
warehousemen's and mechanics' Liens and other similar Liens on the Property of
the Company which secure payment of obligations arising in the ordinary course
of business; (iii) Liens on the Property of the Company in favor of issuers of
performance bonds and surety bonds obtained in the ordinary course of business;
(iv) other Liens on the Property of the Company incidental to the conduct of its
business or the ownership of its Properties which were not created in connection
with the Incurrence of Indebtedness or the obtaining of advances or credit and
which do not in the aggregate materially detract from the value of its
Properties or materially impair the use thereof in the operation of its
business; (v) pledges or deposits by the Company under workmen's compensation
laws, unemployment insurance laws or similar legislation, or good faith deposits
in connection with bids, tenders, contracts (other than for the payment of
Indebtedness) or leases to which the Company or any Restricted Subsidiary is a
party, or deposits to secure public or statutory obligations of the Company or
any Restricted Subsidiary, or deposits for the payment of rent, in each case
Incurred in the ordinary course of business; (vi) utility easements, building
restrictions and such other encumbrances or charges against real property as are
of a nature generally existing with respect to properties of a similar character
and do not materially detract from the value of such Property; and (vii) Liens
securing obligations to the Trustee pursuant to the compensation and indemnity
provisions of this Indenture.
"Permitted Refinancing Indebtedness" means any renewals, extensions,
substitutions, refinancings or replacements of any Indebtedness, including any
successive extensions, renewals, substitutions, refinancings or replacements
(and including refinancings by the Company of Indebtedness of a Restricted
Subsidiary) so long as (i) the aggregate amount of Indebtedness represented
thereby is not increased by such renewal, extension, substitution, refinancing
or replacement, (ii) the Average Life and Stated Maturity is not shortened and
(iii) the new Indebtedness shall not be senior in right of payment to the
Indebtedness that is being extended, renewed, substituted, refinanced or
replaced; provided, however, that Permitted Refinancing Indebtedness shall not
include (a) Indebtedness of a Subsidiary that refinances Indebtedness of the
Company or another Subsidiary or (b) Indebtedness of the Company that refinances
the Indebtedness of an Unrestricted Subsidiary.
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"Person" means any individual, corporation, company (including
limited liability company), partnership, joint venture, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the holders
of other Capital Stock issued by such Person.
"principal" of a Security means the principal of the Security plus
the premium, if any, payable on the Secu rity which is due or overdue or is to
become due at the relevant time.
"pro forma" means, with respect to any calculation made or required
to be made pursuant to the terms hereof, a calculation in accordance with
Article XI of Regulation S-X promulgated under the Securities Act (to the extent
applicable), as interpreted in good faith by the Board of Directors after
consultation with the independent certified public accountants of the Company,
or otherwise a calculation made in good faith by the Board of Directors after
consultation with the independent certified public accountants of the Company,
as the case may be.
"Property" means, with respect to any Person, any interest of such
Person in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible, including, without limitation, Capital Stock in any
other Person (but excluding Capital Stock or other securities issued by such
first Person).
"Rating Agencies" means S&P, Duff & Xxxxxx Credit
Rating Co. and Moody's or any successor to the respective
rating agency businesses thereof.
"Rating Decline" shall have occurred if at any date within 90
calendar days after the date of public disclosure of the occurrence of a Change
of Control (which period will be extended for so long as the Company's debt
ratings are under publicly announced review for possible downgrading (or without
an indication of the direction of a possible ratings change) by either Moody's
or S&P or their respective successors) the Securities no longer have Investment
Grade Status.
"Reference Period" means the period of four consecutive fiscal
quarters ending with the last full fiscal
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quarter immediately preceding the date of a proposed Incurrence, Restricted
Payment or other transaction.
"Related Business" means the business conducted (or proposed to be
conducted) by the Company and its Subsidiaries in connection with any Gaming
Facility and any and all reasonably related businesses necessary for, in
support, furtherance or anticipation of and/or ancillary to or in preparation
for, such business including, without limitation, the development, expansion or
operation of any Gaming Facility (including any land-based, dockside, riverboat
or other type of casino) owned, or to be owned, leased or managed by the Company
or one of its Subsidiaries.
"Related Person" means any legal or beneficial owner of 5% or more
of any class of Capital Stock of the Company or any of its Subsidiaries.
"Representative" means any trustee, agent or representative (if any)
for an issue of Senior Indebtedness of the Company.
"Restricted Payment" means (i) any dividend or distribution (whether
made in cash, property or securities) declared or paid on or with respect to any
shares of Capital Stock of the Company or to the Company's stockholders except
for such dividends or distributions payable solely in Capital Stock of the
Company (other than Disqualified Stock of the Company); (ii) a payment made by
the Company or any Restricted Subsidiary (other than to the Company or a
Restricted Subsidiary) to purchase, redeem, acquire or retire any Capital Stock
of the Company or Capital Stock of any Affiliate of the Company or any warrants,
rights or options, to directly or indirectly purchase or acquire any such
Capital Stock or any securities exchangeable for or convertible into any such
Capital Stock; (iii) a payment made by the Company or any Restricted Subsidiary
to redeem, repurchase, defease or otherwise acquire or retire for value, prior
to any scheduled maturity, scheduled sinking fund or mandatory redemption
payment (other than the purchase, repurchase, or other acquisition of any
Indebtedness subordinate in right of payment to the Securities 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 acquisition),
Indebtedness of the Company which is subordinate (whether pursuant to its terms
or by operation of law) in right of payment to the Securities; or (iv) any
Investment (other than a Permitted Investment) in any Person.
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"Restricted Subsidiary" means any Subsidiary of the Company that (A)
has not been designated by the Board of Directors as an Unrestricted Subsidiary
or (B) was an Unrestricted Subsidiary but has been redesignated by the Board of
Directors as a Restricted Subsidiary, in each case as provided under the
definition of Unrestricted Subsidiary; provided, however, that no Subsidiary
shall become a Restricted Subsidiary unless, immediately after giving pro forma
effect to such designation, the Company would be able to incur at least $1.00 of
additional Indebtedness pursuant to Section 4.04(a).
"Sale/Leaseback Transaction" means, with respect to any Person, any
direct or indirect arrangement pursuant to which Property is sold or transferred
by such Person or a Restricted Subsidiary of such Person and is thereafter
leased back from the purchaser or transferee thereof by such Person or one of
its Restricted Subsidiaries.
"Securities Act" means the Securities Act of 1933, as amended.
"S&P" shall mean Standard & Poor's Ratings Group, a division of the
XxXxxx-Xxxx Companies, Inc.
"Senior Indebtedness" means (a) all obligations consisting of the
principal, premium, if any, and accrued and unpaid interest (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company to the extent post- filing interest is
allowed in such proceeding) in respect of (i) Indebtedness of the Company for
borrowed money and (ii) Indebtedness of the Company evidenced by notes,
debentures, bonds or other similar instruments permitted under this Indenture
for the payment of which the Company is responsible or liable; (b) all Capital
Lease Obligations of the Company; (c) all obligations of the Company (i) for the
reimbursement of any obligor on any letter of credit, bankers' acceptance or
similar credit transaction, (ii) under any Interest Rate Agreement or Currency
Exchange Protection Agreement or (iii) issued or assumed as the deferred
purchase price of Property and all conditional sale obligations of the Company
and all obligations under any title retention agreement permitted under this
Indenture; and (d) all obligations of other Persons of the type referred to in
clauses (a) and (b) for the payment of which the Company is responsible or
liable as guarantor; provided, however, that Senior Indebtedness does not
include (A) Indebtedness of the Company that is by its terms subordinate or pari
passu in right of payment to the
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21
Securities, including any Senior Subordinated Indebtedness or any Subordinated
Obligations; (B) any Indebtedness Incurred in violation of the provisions of
this Indenture; (C) accounts payable or any other obligations of the Company to
trade creditors created or assumed by the Company in the ordinary course of
business in connection with the obtaining of materials or services (including
Guarantees thereof or instruments evidencing such liabilities); (D) any
liability for Federal, state, local or other taxes owed or owing by the Company;
(E) any obligation of the Company to any Subsidiary; or (F) any obligations with
respect to any Capital Stock.
"Senior Subordinated Indebtedness" means the Securities and any
other subordinated indebtedness of the Company that specifically provides that
such Indebtedness is to rank pari passu with the Securities and is not
subordinated by its terms to any other subordinated Indebtedness or other
obligation of the Company which is not Senior Indebtedness.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which a payment of principal of
such security is due and payable, including pursuant to any mandatory redemption
provision (but excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred).
"Subordinated Obligation" means any Indebtedness (whether
outstanding on the Issue Date or thereafter incurred) which is subordinated or
junior in right of payment to the Securities pursuant to a written agreement to
that effect.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (i) such Person, (ii) such
Person and one or more Subsidiaries of such Person or (iii) one or more
Subsidiaries of such Person.
"Temporary Cash Investments" means any of the following: (i)
Investments in U.S. Government Obligations maturing within 90 days of the date
of acquisition thereof,
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(ii) Investments in time deposit accounts, certificates of deposit and money
market deposits maturing within 90 days of the date of acquisition thereof
issued by a bank or trust company which is organized under the laws of the
United States of America or any state thereof having capital, surplus and
undivided profits aggregating in excess of $500,000,000 and whose long-term debt
is rated "A-3" or higher, "A- or higher or "A-" or higher according to Xxxxx'x,
S&P or Duff & Xxxxxx Credit Rating Co. (or such similar equivalent rating by at
least one "nationally recognized statistical rating organization" (as defined in
Rule 436 under the Securities Act)), respectively, (iii) repurchase obligations
with a term of not more than 7 days for underlying securities of the types
described in clause (i) entered into with a bank meeting the qualifications
described in clause (ii) above, and (iv) Investments in commercial paper,
maturing not more than 90 days after the date of acquisition, issued by a
corporation (other than the Company or an Affiliate of the Company) organized
and in existence under the laws of the United States of America with a rating at
the time as of which any Investment therein is made of "P-1" (or higher)
according to Xxxxx'x, "A-1" (or higher) according to S&P or "A-1" (or higher)
according to Duff & Xxxxxx Credit Rating Co. (or such similar equivalent rating
by at least one "nationally recognized statistical rating organization" (as
defined in Rule 436 under the Securities Act)).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of this Indenture; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "TIA" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939, as so amended.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
which at the time of determination shall be an Unrestricted Subsidiary (as
designated by the Board of Directors) and (ii) any Subsidiary of an Unrestricted
Subsidiary. The Board of Directors may designate any Subsidiary of the Company
(including any newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary (unless such Subsidiary owns any Capital Stock of or owns or holds
any Lien on any Property of the Company or any other Subsidiary of the Company
which is not a Subsidiary of the Subsidiary to be so designated); provided that
either (A) the Subsidiary to be so designated has total assets of $1,000 or less
or (B) such designation is effective immediately upon such entity becoming a
Subsidiary of the Company. Subject to clause (ii) above, the Board of
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Directors may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that immediately after giving pro forma effect to such
redesignation, the Company would be able to incur at least $1.00 of additional
Indebtedness pursuant to Section 4.04(a).
Any such designation by the Board of Directors will be evidenced to
the Trustee by filing with the Trustee a copy of the Board Resolution giving
effect to such designation and an Officers' Certificate certifying (i) that such
designation complies with the foregoing provisions and (ii) giving the effective
date of such designation, such filing with the Trustee to occur within 75 days
after the end of the fiscal quarter of the Company in which such designation is
made (or, in the case of a designation made during the last fiscal quarter of
the Company's fiscal year, within 120 days after the end of such fiscal year).
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" means securities of any class or classes of a Person,
the holders of which are ordinarily, in the absence of contingencies, entitled
to vote for corporate directors (or Persons performing equivalent functions).
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the
Company all the Capital Stock of which (other than directors' qualifying shares)
is owned by the Company or another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction"......................................... 4.06(a)
"Bankruptcy Law"................................................ 6.01
"Change of Control Offer"....................................... 4.07(a)
"Change of Control Payment"..................................... 4.07(a)
"Change of Control Payment Date"................................ 4.07(b)
"covenant defeasance option"................................... 8.01(b)
"Custodian"..................................................... 6.01
"Defaulted Interest"........................................... 2.11
"Depositary"................................................... 2.02
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"Events of Default"............................................. 6.01
"Excess Proceeds".............................................. 4.12
"Global Security".............................................. 2.02
"incorporated provision........................................ 11.01
"legal defeasance option"...................................... 8.01(b)
"Legal Holiday"................................................ 11.07
"pay the Securities"........................................... 10.03
"Paying Agent"................................................. 2.03
"Payment Blockage Notice".......................................10.03
"Payment Blockage Period".......................................10.03
"Prepayment Offer".............................................. 4.12(d)
"Prepayment Offer Notice"....................................... 4.12(e)
"Purchase Date"................................................. 4.12(e)
"Registrar"..................................................... 2.03
"Successor"..................................................... 5.01
"Suspended Covenants"........................................... 4.01
"Trust Officer"................................................ 7.01(c)
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the Commission.
"indenture securities" means the Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any
other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
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(3) "or" is not exclusive;
(4) "including" means including without limita tion;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) unsecured Indebtedness shall not be deemed to be subordinate or
junior to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(7) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof that
would be shown on a balance sheet of the issuer dated such date prepared
in accordance with GAAP; and
(8) the principal amount of any Preferred Stock shall be the greater
of (i) the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with respect to
such Preferred Stock.
ARTICLE II
The Securities
SECTION 2.01. Form and Dating. Provisions relating to the Initial
Securities and the Exchange Securities are set forth in Appendix A, which is
hereby incorporated in and expressly made part of this Indenture. The Initial
Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit 1 to Appendix A which is hereby
incorporated in and made a part of this Indenture. The Exchange Securities and
the Trustee's certificate of authentication shall be substantially in the form
of Exhibit A, which is hereby incorporated in and expressly made a part of this
Indenture. The Securities may have notations, legends or endorsements required
by law, stock exchange rule, agreements to which the Company is subject, if any,
or usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company). Each Security shall be dated the date of its
authentication. The terms of the Securities set forth in Exhibit 1 to Appendix A
and Exhibit A are part of the terms of this Indenture.
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SECTION 2.02. Execution and Authentication. Two Officers of the
Company shall sign the Securities by manual or facsimile signature. The
Company's seal shall be impressed, affixed, imprinted or reproduced on the Secu
rities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee xxxxxxxx xxxxx the Security, the Security shall
be valid neverthe less.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be con clusive evidence that the Security has been authenticated
under this Indenture.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate the Securities. Unless limited by the
terms of such appoint ment, an authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authen tication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent (as
defined in Section 2.03) or agent for service of notices and demands.
SECTION 2.03. Registrar and Paying Agent. The Company shall maintain
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Secur ities and of their transfer and exchange. The
Company may have one or more coregistrars and one or more additional paying
agents. The term "Paying Agent" includes any addi tional paying agent.
The Company shall enter into an appropriate agency agreement with
any Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of any such agent. If the Company fails to
maintain a Regis trar or Paying Agent, the Trustee shall act as such and shall
be entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any of its domestically incorporated Wholly Owned Subsidiaries may
act as Paying Agent, Registrar, co-registrar or transfer agent.
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The Company initially appoints the Trustee as Registrar and Paying
Agent in connection with the Securi ties.
SECTION 2.04. Paying Agent To Hold Money in Trust. Prior to each due
date of the principal and interest on any Security, the Company shall deposit
with the Paying Agent a sum sufficient to pay such principal and interest when
so becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Securityholders or the Trustee all money held by the Paying Agent for
the payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as
Paying Agent and hold it as a separate trust fund. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and to account
for any funds disbursed by the Paying Agent. Upon complying with this Section,
the Paying Agent shall have no further liability for the money delivered to the
Trustee.
SECTION 2.05. Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably prac ticable the most recent list available to
it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least five
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.
SECTION 2.06. Replacement Securities. If a mutilated Security is
surrendered to the Registrar or if the Holder of a Security provides evidence
reasonably satisfactory to the Company and the Trustee that the Security has
been lost, destroyed or wrongfully taken, then, in absence of notice to the
Company or the Trustee that the Security has been acquired by a bona fide
purchaser, the Company shall issue and the Trustee shall authenticate a
replacement Security if the Holder satisfies the reasonable requirements of the
Trustee or the Company. If required by the Trustee or the Company, such Holder
shall furnish an indemnity bond sufficient in the judgment of the Company and
the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar
and any co-registrar from any loss which any of them may suffer if a Security is
replaced. The
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Company and the Trustee may charge the Holder for their expenses in replacing a
Security.
Every replacement Security is an additional obligation of the
Company.
SECTION 2.07. Outstanding Securities. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancelation and those described in this Section
as not outstanding. A Security does not cease to be outstand ing because the
Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Sec tion 2.06, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance
with this Indenture, on a redemption date or maturity date money sufficient to
pay all principal and interest payable on that date with respect to the
Securities (or portions thereof) to be redeemed or maturing, as the case may be,
then on and after that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
In determining whether the Holders of the required principal amount
of Securities have concurred in any direction or consent or any amendment,
modification or other change to this Indenture, Securities owned by the Company
or by an Affiliate of the Company shall be disregarded and treated as if they
were not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent
or any amendment, modification or other change to this Indenture, only
Securities which the Trustee knows are so owned shall be so disregarded.
Securities so owned which have been pledged in good faith shall not be
disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to the Securities and that the pledgee is
not the Company or an Affiliate of the Company.
SECTION 2.08. Temporary Securities. Until definitive Securities are
ready for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations
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that the Company considers appropriate for temporary Secur ities. Without
unreasonable delay, the Company shall prepare and the Trustee shall authenticate
definitive Securities and deliver them in exchange for temporary Securities.
SECTION 2.09. Cancelation. The Company at any time may deliver
Securities to the Trustee for cancelation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel
(subject to the record retention require ments of the Exchange Act) all
Securities surrendered for registration of transfer, exchange, payment or
cancelation and deliver the canceled Securities to the Company. The Company may
not issue new Securities to replace Securities it has redeemed, paid or
delivered to the Trustee for cancelation.
SECTION 2.10. Defaulted Interest. Any interest on any Security which
is payable, but is not punctually paid or duly provided for, on the dates and in
the manner provided in the Securities and this Indenture (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant record date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in clause (i) or (ii) below:
(i) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities are registered at the close
of business on a special record date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed
to be paid on each Security and the date of the proposed payment, and at
the same time the Company shall irrevocably 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 in this clause provided.
Thereupon the Trustee shall fix a special record date for the payment of
such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than
10 days after the receipt by
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the Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such special record date and, in the name
and at the expense of the Company, shall cause notice of the proposed
payment of such Defaulted Interest and the special record date therefor to
be given to each Holder, not less than 10 days prior to such special
record date. Notice of the proposed payment of such Defaulted Interest and
the special record date therefor having been so mailed, such Defaulted
Interest shall be paid to the Persons in whose names the Securities are
registered at the close of business on such special record date.
(ii) The Company may make payment of any Defaulted Interest on the
Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.10, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 2.11. Record Date. The Company may set a record date for
purposes of determining the identity of Securityholders entitled to vote or to
consent to any action solicited by the Company by vote of consent authorized or
permitted by Sections 6.04 and 6.05. Unless this Indenture provides otherwise,
such record date shall be the later of 30 days prior to the first solicitation
of such consent or the date of the most recent list of Holders furnished to the
Trustee pursuant to Section 2.05 prior to such solicitation.
SECTION 2.12. Computation of Interest. Interest on the Securities
shall be computed on the basis of a 360- day year of twelve 30-day months. For
disclosure purposes under the Interest Act (Canada), whenever in this Indenture
or the Securities interest at a specified rate is to be calculated on the basis
of a period less than a calendar year, the yearly rate of interest to which such
rate is equivalent is such rate multiplied by the actual number of
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days in the relevant calendar year and divided by the number
of days in such period.
SECTION 2.13. CUSIP Numbers. The Company in issuing the Securities
may use "CUSIP" numbers and, if it does so, the Trustee shall use the CUSIP
numbers in notices of redemption or exchange as a convenience to Holders;
provided that any such notice may state that no representa tion is made as to
the correctness or accuracy of the CUSIP numbers printed in the notice or on the
Securities and that reliance may be placed only on the other identification
numbers printed on the Securities. The Company will promptly notify the Trustee
of any change in the CUSIP numbers.
ARTICLE III
Redemption
SECTION 3.01. Notices to Trustee. If the Company elects to redeem
Securities pursuant to paragraph 5 of the Securities, it shall notify the
Trustee in writing of the redemption date, the principal amount of Securities to
be redeemed and the paragraph of the Securities pursuant to which the redemption
will occur.
The Company shall give each notice to the Trustee provided for in
this Section at least 45 days before the redemption date unless the Trustee
consents to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Company to the effect that such
redemption will comply with the condi tions herein.
SECTION 3.02. Selection of Securities To Be Redeemed. If fewer than
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by a method that complies with applicable
legal and securities exchange requirements, if any, and that the Trustee
considers fair and appropriate and in accordance with methods generally used at
the time of selection by fiduciaries in similar circumstances. The Trustee shall
make the selection from outstanding Securities not previously called for
redemption. The Trustee may select for redemption portions of the principal of
Secur ities that have denominations larger than $1,000. Secur ities and portions
of them the Trustee selects shall be in amounts of $1,000 or a whole multiple of
$1,000. Provisions of this Indenture that apply to Securities called for
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redemption also apply to portions of Securities called for redemption. The
Trustee shall notify the Company promptly of the Securities or portions of
Securities to be redeemed.
SECTION 3.03. Notice of Redemption. At least 30 days but not more
than 60 days before a date for redemp tion of Securities, the Company shall mail
a notice of redemption by first-class mail to each Holder of Securities to be
redeemed.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be
surrendered to the Paying Agent to collect the redemp
tion price;
(5) if fewer than all the outstanding Securities
are to be redeemed, the identification and principal
amounts of the particular Securities to be redeemed;
(6) that, unless the Company defaults in making such redemption
payment or the Paying Agent is pro hibited from making such payment
pursuant to the terms of this Indenture, interest on Securities (or
portion thereof) called for redemption ceases to accrue on and after the
redemption date; and
(7) 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
Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section at least 45 days before the redemption date.
SECTION 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surren der to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued
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interest to the redemption date (subject to the right of Holders of record on
the relevant record date to receive interest due on the related interest payment
date). Failure to give notice or any defect in the notice to any Holder shall
not affect the validity of the notice to any other Holder.
SECTION 3.05. Deposit of Redemption Price. Prior to the redemption
date, the Company shall deposit with the Paying Agent (or, if the Company or a
Subsidiary is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued inter est (subject to the
right of Holders of record on the relevant record date to receive interest due
on the related interest payment date) on all Securities to be redeemed on that
date other than Securities or portions of Securities called for redemption which
have been delivered by the Company to the Trustee for cancelation.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Secur ity
surrendered.
SECTION 3.07. Redemption Pursuant to Gaming Laws. (a) If any Gaming
Authority requires that a Holder or beneficial owner of Securities must be
licensed or found qualified or suitable to hold or own the Securities, but that
Person is not licensed or found qualified or suitable within any time specified
by such Gaming Authority, or such Gaming Authority denies a license to or finds
unqualified or unsuitable such Person, the Company will have the right at its
option to require such Person to dispose of such Person's Securities within the
time period prescribed by the Company (or such other time period as may be
prescribed by any Gaming Authority, which time period shall be specified in a
written notice from the Company). If such Holder or beneficial owner, having
been given the opportunity by the Company to dispose of such Securities, fails
to dispose of such Securities within the prescribed time period, the Company
shall have the right to call for redemption such Securities by notice of
redemption to such Person given in accordance with Section 3.07(c) with the
effect set forth in Section 3.04. A copy of such notice of any such required
disposition or call for redemption shall be given to the Trustee.
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(b) On any redemption of Securities pursuant to this Section 3.07,
the redemption price (the "Redemption Price") shall be the lesser of (i) the
lowest closing sale price of the Securities on any trading day during the 120-
day period ending on the date upon which the Company shall have received notice
from a Gaming Authority of such Holder's disqualification or (ii) the price at
which such Holder or beneficial owner acquired the Securities, unless a
different redemption price is required by such Gaming Authority, in which event
such required price shall be the Redemption Price. Each Holder and beneficial
owner, by accepting a Security, agrees to the provisions of this Section 3.07
and any related paragraphs of the Securities and agrees to inform the Company
upon request of the price at which such Holder or beneficial owner acquired such
Holder's or beneficial owner's Securities.
(c) Any redemption notice given by the Company under this Section
3.07 shall state (i) that the Securities are being called for redemption as a
result of the Holder's or beneficial owner's status under the relevant Gaming
Laws, (ii) the Redemption Date, (iii) the Redemption Price and (iv) the place or
places where such Securities are to be surrendered for payment of the Redemption
Price.
ARTICLE IV
Covenants
SECTION 4.01. Certain Suspended Covenants. During any period of time
that (i) the Securities have Investment Grade Status and (ii) no Default or
Event of Default has occurred and is continuing under this Indenture with
respect to the Securities, the Company and its Restricted Subsidiaries will not
be subject to the provisions of Sections 4.04, 4.05 and 4.12 (collectively, the
"Suspended Covenants"). In the event that the Company and its Restricted
Subsidiaries are not subject to the Suspended Covenants with respect to the
Securities for any period of time as a result of the preceding sentence and,
subsequently, at least two of the three Rating Agencies withdraw their ratings
or assign the Securities a rating below the required Investment Grade Ratings,
then the Company and its Restricted Subsidiaries will thereafter again be
subject to the Suspended Covenants for the benefit of the Securities and
compliance with the Suspended Covenants with respect to Restricted Payments made
after the time of such withdrawal or assignment will be calculated in accordance
with Section 4.05 as if such Section had been in
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effect during the entire period of time from the Issue Date with respect to the
Securities.
SECTION 4.02. Payment of Securities. The Company shall promptly pay
the principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due.
The Company shall pay interest on overdue princi pal at the rate
specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.03. SEC Reports. The Company shall file with the Trustee
and provide Securityholders, within 15 days after it files them with the
Commission, copies of its annual report and the information, documents and other
reports which the Company is required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act. Notwithstanding that the Company may
not be required to remain subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act, the Company shall continue to file with the
Commission and provide the Trustee and Securityholders with the annual reports
and the information, documents and other reports which are specified in Sections
13 and 15(d) of the Exchange Act. The Company also shall comply with the other
provisions of TIA Section 314(a).
SECTION 4.04. Limitation on Indebtedness. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, Incur any Indebtedness unless
no Event of Default has occurred and is continuing and unless (after giving
effect to (i) the Incurrence of such Indebtedness as if such Indebtedness was
Incurred at the beginning of the Reference Period and (if applicable) the
application of the net proceeds thereof to repay other Indebtedness as if the
application of such proceeds occurred at the beginning of the Reference Period,
(ii) the Incurrence and retirement of any other Indebtedness since the first day
of the Reference Period as if such Indebtedness was Incurred or retired at the
beginning of the Reference Period and (iii) the acquisition or disposition of
any company or business by the Company or any Restricted Subsidiary since the
first day of the Reference Period including any acquisition or disposition which
will be consummated contemporaneously with the Incurrence of such
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Indebtedness, as if such acquisition or disposition occurred at the beginning of
the Reference Period), the Company's Consolidated Fixed Charge Coverage Ratio
would exceed 2.0 to
1.0.
(b) Notwithstanding the foregoing limitation, the Company or any
Restricted Subsidiary may Incur the following Indebtedness: (i) Indebtedness
evidenced by the Securities; (ii) Indebtedness outstanding on the Issue Date;
(iii) Indebtedness under the Credit Facility in an aggregate amount outstanding
at any time not to exceed $500 million (less (A) the aggregate principal amount
of CHFC Notes then outstanding and (B) Indebtedness Incurred pursuant to clause
(x) below to refinance Indebtedness previously Incurred pursuant to this clause
(iii) and any Permitted Refinancing Indebtedness in respect thereof), as such
amount may be reduced as a result of repayments pursuant to Section 4.12 hereof
of Indebtedness outstanding under the Credit Facility; (iv) Indebtedness of the
Company or a Restricted Subsidiary owing to and held by a Restricted Subsidiary
or the Company; provided, however, that any subsequent issuance or transfer of
any Capital Stock or other event that results in any such Restricted Subsidiary
ceasing to be a Restricted Subsidiary or any subsequent transfer of any such
Indebtedness except to the Company or a Restricted Subsidiary shall be deemed in
each case to constitute the Incurrence of such Indebtedness by the issuer
thereof; (v) Indebtedness under Interest Rate Agreements entered into for the
purpose of limiting interest rate risks, provided that the obligations under
such agreements are related to payment obligations on Indebtedness otherwise
permitted by the terms of this covenant; (vi) Indebtedness under Currency
Exchange Protection Agreements, provided that such Currency Exchange Protection
Agreements were entered into for the purpose of limiting exchange rate risks in
connection with transactions entered into in the ordinary course of business;
(vii) Indebtedness in connection with one or more standby letters of credit,
performance bonds or completion guarantees issued in the ordinary course of
business or pursuant to self-insurance obligations and not in connection with
the borrowing of money or the obtaining of advances or credit; (viii)
Indebtedness outstanding under Permitted FF&E Financings which are either (x)
Non-Recourse Indebtedness of the Company and its Restricted Subsidiaries or (y)
limited in amount for each Gaming Facility owned or leased by the Company or any
of its Restricted Subsidiaries to the lesser of (1) the amount of FF&E used in
such Gaming Facility and financed by such Permitted FF&E Financing or (2) $10
million; (ix) so long as no Event of Default has occurred and is continuing,
Indebtedness of the Company not
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otherwise permitted to be Incurred pursuant to the provisions of the immediately
preceding paragraph or this paragraph in an aggregate amount not to exceed $25
million outstanding at any time; or (x) Permitted Refinancing Indebtedness
Incurred in respect of Indebtedness outstanding pursuant to the provisions of
Section 4.04(a) or clauses (i), (ii) (other than the CHFC Notes), (iii), (viii)
and this clause (x) of this Section 4.04(b).
SECTION 4.05. Limitation on Restricted Payments. (a) The Company
shall not make, and shall not permit any Restricted Subsidiary to make, any
Restricted Payment if at the time of, and after giving effect to, such proposed
Restricted Payment, (i) a Default or an Event of Default shall have occurred and
be continuing, (ii) the Company could not Incur at least $1.00 of additional
Indebtedness pursuant to Section 4.04(a) or (iii) the aggregate amount of such
Restricted Payment and all other Restricted Payments made from and after the
date of this Indenture (the amount of any Restricted Payment, if made other than
in cash, to be based upon Fair Market Value) would exceed an amount equal to the
sum of (A) 50% of the Consolidated Net Income accrued during the period (treated
as one accounting period) from April 1, 1997 to the end of the most recent
fiscal quarter ended immediately prior to the date of such Restricted Payment
(or, in the case such Consolidated Net Income shall be a deficit, minus 100% of
such deficit); (B) the aggregate Net Cash Proceeds received by the Company from
the issue or sale of its Capital Stock (other than Disqualified Stock)
subsequent to March 31, 1997 (other than an issuance or sale to a Subsidiary of
the Company or an employee stock ownership plan or other trust established by
the Company or any of its Subsidiaries or pursuant to clauses (iii) or (iv) of
the following paragraph); (C) the amount by which Indebtedness of the Company or
any Restricted Subsidiary is reduced on the Company's balance sheet upon the
conversion or exchange (other than an issuance or sale to a Subsidiary of the
Company or an employee stock ownership plan or other trust established by the
Company or any of its Subsidiaries) subsequent to March 31, 1997 of any
Indebtedness of the Company or any Restricted Subsidiary convertible or
exchangeable for Capital Stock (other than Disqualified Stock) of the Company
(less the amount of any cash or other property distributed by the Company or any
Restricted Subsidiary upon such conversion or exchange); (D) the amount equal to
the net reduction in Investments resulting from (1) payments of dividends,
repayments of loans or advances or other transfers of assets to the Company or
any Restricted Subsidiary or the satisfaction or reduction (other than by means
of payments by the Company or any
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Restricted Subsidiary) of obligations of other Persons which have been
Guaranteed by the Company or any Restricted Subsidiary or (2) the redesignation
of Unrestricted Subsidiaries as Restricted Subsidiaries, in each case such net
reduction in Investments being (x) valued as provided in the definition of
"Investment", (y) in an amount not to exceed the aggregate amount of Investments
previously made by the Company or any Restricted Subsidiary which were treated
as a Restricted Payment, and (z) included in this clause (D) only to the extent
not included in Consolidated Net Income; (E) payments of dividends, repayments
of loans or advances or other transfers of assets to the Company or any
Restricted Subsidiary from the Mirage Joint Venture to the extent such
dividends, repayments, advances or other transfers exceed $100 million; and (F)
$75 million; provided, however, that in the event that the sum of the amounts
referred to in clauses (A) through (E) above is a negative number, such sum
shall be deemed to be zero.
(b) The provisions of the preceding paragraph shall not prohibit:
(i) the payment of any dividend within 60 days after the date of its declaration
if such dividend could have been paid on the date of its declaration in
compliance with such provisions; provided that at the time of payment of such
dividend no Default under any provision of this Indenture other than this
Section 4.05 shall have occurred and be continuing (or would result therefrom);
(ii) the redemption or repurchase of any Capital Stock or Indebtedness of the
Company (other than any Capital Stock or Indebtedness which is held or
beneficially owned by, or issued by, any member of the Xxxx Family, the Company
or any Affiliate of the Company), (A) if the holder or beneficial owner of such
Capital Stock or Indebtedness is required to qualify under the Gaming Laws and
does not so qualify or (B) if necessary in the reasonable, good faith judgment
of the Board of Directors, as evidenced by a Board Resolution, to prevent the
loss or secure the reinstatement of any Gaming License which if lost or not
reinstated, as the case may be, would have a material adverse effect on the
business of the Company and its Subsidiaries, taken as a whole, or would
restrict the ability of the Company or any of its Subsidiaries to conduct
business in any gaming jurisdiction; (iii) any purchase, redemption or other
acquisition or retirement of Capital Stock of the Company made by exchange for,
or out of the proceeds of the substantially concurrent sale of, Capital Stock
(other than Disqualified Stock) of the Company; (iv) any purchase, redemption or
other acquisition or retirement of the Indebtedness of any Person made by
exchange for, or out of the proceeds of the substantially concurrent sale of,
Capital Stock (other than
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Disqualified Stock) of the Company; (v) any purchase, redemption, defeasance or
other acquisition or retirement for value of Indebtedness from the proceeds of
Permitted Refinancing Indebtedness; (vi) Investments not to exceed $100 million
in the Mirage Joint Venture; (vii) Investment Guarantees to the extent permitted
by Section 4.04 that constitute Permitted Joint Venture Investments and
Guarantee (with full rights of subrogation) Indebtedness Incurred by a Permitted
Joint Venture to acquire or construct Gaming Facilities provided that such
Indebtedness (A) is not expressly subordinated in right of payment or otherwise
to any other Indebtedness of such Permitted Joint Venture and (B) is secured by
first priority security interests in such Gaming Facilities; and (viii) payments
pursuant to Investment Guarantees which were entered into in compliance with
clause (vii) of this Section 4.05(b).
(c) The full amount of any Restricted Payments pursuant to clauses
(i) and (ii) of Section 4.05(b) (but not pursuant to clauses (iii), (iv), (v)
and (vi) of Section 4.05(b)) shall be included in the calculation of the
aggregate amount of the Restricted Payments referred to in Section 4.05(a). With
respect to any Investment Guarantee, (x) if at any time the Company or any
Restricted Subsidiary ceases to control the day-to-day operations of the
Permitted Joint Venture the Indebtedness of which is Guaranteed by the
Investment Guarantee, the full amount of such Investment Guarantee shall
thereafter be included in the calculation of the aggregate amount of Restricted
Payments referred to in Section 4.05(a) and (y) if the Company or a Restricted
Subsidiary retains such control, any amount actually paid pursuant to such
Investment Guarantee shall be included in the calculation of the aggregate
amount of Restricted Payments referred to in Section 4.05(a).
SECTION 4.06. Limitation on Transactions with Affiliates. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, directly
or indirectly, conduct any business or enter into or suffer to exist any
transaction or series of transactions (including the purchase, sale, transfer,
lease or exchange of any Property, the making of any Investment, the giving of
any Guarantee or the rendering or receiving of any service) with, from or for
the benefit of, (1) any Affiliate, (2) any Related Person or (3) any officer or
director of any Affiliate or a Related Person (an "Affiliate Transaction")
unless (i) the terms of such Affiliate Transaction are (a) in writing, if such
Affiliate Transaction involves aggregate payments to either party in excess of
$250,000, (b) in the best interest of the Company or such Restricted Subsidiary,
as the case may be,
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and (c) at least as favorable to the Company or such Restricted Subsidiary, as
the case may be, as those that could be obtained at the time of such Affiliate
Transaction in a similar transaction in arm's-length dealings with a Person who
is not such an Affiliate, Related Person or officer or director of an Affiliated
or Related Person, (ii) with respect to each Affiliate Transaction involving
aggregate payments to either party in excess of $5 million, the Company delivers
to the Trustee an Officers' Certificate certifying that such Affiliate
Transaction was approved by a majority of the disinterested members of the Board
of Directors and that such Affiliate Transaction complies with clause (i), and
(iii) with respect to each Affiliate Transaction involving aggregate payments in
excess of $20 million, the Company delivers to the Trustee an opinion letter
from an Independent Advisor to the effect that such Affiliate Transaction is
fair, from a financial point of view.
(b) Notwithstanding the limitation of Section 4.06(a), the Company
may enter into or suffer to exist the following: (i) any transaction pursuant to
any contract in existence on the Issue Date; (ii) any Restricted Payment
permitted to be made pursuant to Section 4.05; (iii) any transaction or series
of transactions between the Company and one or more of its Restricted
Subsidiaries or Permitted Joint Ventures or between two or more of its
Restricted Subsidiaries or Permitted Joint Ventures; and (iv) the payment of
compensation (including amounts paid pursuant to employee benefit plans) for the
personal services of officers, directors and employees of the Company or any of
its Restricted Subsidiaries, so long as the Board of Directors in good faith
shall have approved the terms thereof and deemed the services theretofore or
thereafter to be performed for such compensation to be fair consideration
therefor.
SECTION 4.07. Change of Control. (a) Upon the occurrence of (i) in
the event at the Change of Control Time the Securities do not have Investment
Grade Status, a Change of Control or, (ii) in the event at the Change of Control
Time the Securities have Investment Grade Status, a Change of Control Triggering
Event, each Holder shall have the right to require the Company to repurchase all
or any part (equal to $1,000 or an integral multiple thereof) of such Holder's
Securities pursuant to the offer described below (the "Change of Control Offer")
at a purchase price equal to 101% of the principal amount thereof, plus accrued
and unpaid interest, if any, thereon to the purchase date (the "Change of
Control Payment").
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(b) Within 30 days following (i) any Change of Control or, (ii) in
the event the Securities at the earlier of the public announcement of (x) a
Change of Control or (y) (if applicable) the intention of the Company to effect
a Change of Control have Investment Grade Status, a Change of Control Triggering
Event, the Company shall mail a notice to the Trustee and each Holder stating,
among other things: (1) that a Change of Control or Change of Control Triggering
Event, as the case may be, has occurred and a Change of Control Offer is being
made pursuant to this Section 4.07 and that all Securities (or portions thereof)
timely tendered will be accepted for payment; (2) the purchase price and the
purchase date, which shall be, subject to any contrary requirements of
applicable law, no earlier than 30 days nor later than 60 days from the date
such notice is mailed (the "Change of Control Payment Date"); (3) that any
Securities (or portion thereof) accepted for payment (and for which payment has
been duly provided on the Change of Control Payment Date) pursuant to the Change
of Control Offer shall cease to accrue interest after the Change of Control
Payment Date; (4) that any Securities (or portions thereof) not tendered will
continue to accrue interest; (5) a description of the transaction or
transactions constituting the Change of Control or Change of Control Triggering
Event, as the case may be; and (6) the procedures that Holders must follow in
order to tender their Securities (or portions thereof) for payment and the
procedures that Holders must follow in order to withdraw an election to tender
Securities (or portions thereof) for payment.
(c) Not later than the Business Day prior to the Change of Control
Payment Date, the Company shall irrevocably deposit with the Trustee or with a
paying agent (or, if the Company is acting as its own paying agent, segregate
and hold in trust) in Temporary Cash Investments an amount equal to the Change
of Control Payment, if any, to be made to the Holders entitled thereto, to be
held for payment in accordance with the provisions of this Section 4.07. Holders
electing to have a Security purchased will be required to surrender the
Security, with an appro priate form duly completed, to the Company at the
address specified in the notice at least five Business Days prior to the Change
of Control Payment Date. Holders will be entitled to withdraw their election if
the Trustee or the Company receives not later than three Business Days prior to
the purchase date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the princi pal amount of the Security which was
delivered for purchase by the Holder, the certificate number of such Security
and a
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statement that such Holder is withdrawing his election to have such Security
purchased.
(d) On the Business Day prior to the Change of Control Payment Date,
the Company shall deliver to the Trustee the Securities or portions thereof
which have been properly tendered to and are to be accepted by the Company. The
Trustee shall, on the Change of Control Payment Date, mail or deliver payment of
the purchase price to each tendering Holder. In the event that the aggregate
purchase price of the Securities delivered by the Company to the Trustee is less
than the amount deposited with the Trustee, the Trustee shall deliver the excess
to the Company immediately after the end of the payment date.
(e) The Company will comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act, and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable in connection with the purchase of Securities in connection with a
Change of Control or Change of Control Triggering Event, as the case may be. To
the extent that the provisions of any securities laws or regulations conflict
with the provisions relating to the Change of Control Offer, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under Section 4.07 by virtue thereof.
SECTION 4.08. Compliance Certificate. The Company shall deliver to
the Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with TIA Section 314(a)(4).
SECTION 4.09. Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.10. Limitation on Liens. The Company shall not, directly
or indirectly, Incur or suffer to exist, any Lien (other than Permitted Liens)
upon any of its
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Property, whether owned at the Issue Date or thereafter acquired, or any
interest therein or any income or profits therefrom, which secures Indebtedness
that ranks pari passu with or is subordinated to the Securities unless (a) if
such Lien secures Indebtedness that ranks pari passu with the Securities, the
Securities are secured on an equal and ratable basis with the obligations so
secured or (b) if such Lien secures Indebtedness that is subordinated to the
Securities, such Lien shall be subordinated to a Lien granted to the holders of
the Securities in the same collateral as that securing such Indebtedness
subordinated to the Securities to the same extent as such subordinated
Indebtedness is subordinated to the Securities.
SECTION 4.11. Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries. The Company shall not, and shall
not permit any Restricted Subsidiary to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any Restricted Subsidiary to (a)(i) pay dividends
or make any other distributions to the Company or any other Restricted
Subsidiary (A) on its Capital Stock or (B) with respect to any other interest or
participation in, or measured by, its profits, or (ii) pay any indebtedness owed
to the Company or any other Restricted Subsidiary or (b) make loans or advances
to the Company or any other Restricted Subsidiary or (c) transfer any of its
Property to the Company or any other Restricted Subsidiary, except for such
encumbrances or restrictions existing under or by reason of (i) agreements in
effect on the Issue Date; (ii) applicable law; (iii) customary nonassignment
provisions in leases entered into in the ordinary course of business and
consistent with past practices; (iv) Permitted Refinancing Indebtedness;
provided, however, that the restrictions contained in the agreements governing
such Permitted Refinancing Indebtedness are no more restrictive than those
contained in the agreements governing the Indebtedness being refinanced; or (v)
agreements in existence with respect to a Restricted Subsidiary at the time it
is so designated; provided, however, that such agreements are not entered into
in anticipation or contemplation of such designation. Nothing contained in this
covenant shall prevent the Company or any Restricted Subsidiary from granting
any Lien permitted by Section 4.10.
SECTION 4.12. Limitation on Asset Sales; Event of Loss. (a) Other
than upon an Event of Loss, the Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale
after
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the Issue Date, where the Property subject to such Asset Sale has an aggregate
Fair Market Value equal to or in excess of $20 million, unless: (i) the Company
or such Restricted Subsidiary, as the case may be, receives consideration at the
time of such Asset Sale at least equal to the Fair Market Value of the Property
subject to such Asset Sale; (ii) at least 75% of such consideration consists of
cash or Temporary Cash Investments; provided, however, that for purposes of this
clause (ii), (x) the assumption of Indebtedness of the Company or a Restricted
Subsidiary which is not subordinated to the Securities shall be deemed to be
Temporary Cash Investments if the Company, such Restricted Subsidiary, and all
other Restricted Subsidiaries of the Company, to the extent any of the foregoing
are liable with respect to such Indebtedness, are expressly released from all
liability for such Indebtedness by the holder thereof in connection with such
Asset Sale, (y) any securities or notes received by the Company or such
Restricted Subsidiary from such transferee that are converted by the Company or
such Restricted Subsidiary into cash or Temporary Cash Investments within 20
Business Days of such Asset Sale shall be deemed to be Temporary Cash
Investments and (z) the Company and its Restricted Subsidiaries may receive
consideration in the form of securities exceeding 25% of the consideration for
one or more Asset Sales so long as the Company and its Restricted Subsidiaries
do not hold such securities having an aggregate Fair Market Value in excess of
$50 million at any time outstanding; (iii) no Event of Default shall have
occurred and be continuing at the time of, or would occur after giving effect,
on a pro forma basis, to, such Asset Sale; and (iv) the Board of Directors
determines in good faith that such Asset Sale complies with clauses (i) and
(ii).
(b) Upon an Event of Loss incurred by the Company or any of its
Restricted Subsidiaries, the Net Proceeds received from such Event of Loss shall
be applied in the same manner as proceeds from Asset Sales described in Section
4.12(a) and pursuant to the procedures set forth in this Section 4.12.
(c) Within 360 days after the receipt of the Net Proceeds of an
Asset Sale or Event of Loss, some or all of the Net Proceeds from such Asset
Sale or Event of Loss may be applied by the Company or a Restricted Subsidiary
(A) to permanently repay, redeem or repurchase Senior Indebtedness of the
Company or Indebtedness of any Restricted Subsidiary or (B) to reinvest in
Additional Assets (including by means of an Investment in Additional Assets by a
Restricted Subsidiary with Net Proceeds received by the Company or
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another Restricted Subsidiary); provided, however, that if the Company or any
Restricted Subsidiary contractually commits within such 360-day period to apply
such Net Proceeds within 180 days of such contractual commitment in accordance
with the above clauses (A) or (B), and such Net Proceeds are subsequently
applied as contemplated in such contractual commitment, then the requirement for
application of Net Proceeds set forth in this Section 4.12(c) shall be
considered satisfied.
(d) Any Net Proceeds from an Asset Sale or Event of Loss that are
not used in accordance with Section 4.12(c) shall constitute "Excess Proceeds".
When the aggregate amount of Excess Proceeds exceeds $20 million (taking into
account income earned on such Excess Proceeds), the Company shall make an offer
to purchase (the "Prepayment Offer"), on a pro rata basis, from all Holders of
the Securities (together with the holders of all other Senior Subordinated
Indebtedness which have a similar repurchase obligation), an aggregate principal
amount of Securities and such other Senior Subordinated Indebtedness equal to
the Excess Proceeds, at a price in cash at least equal to 100% of the principal
amount thereof, plus accrued and unpaid interest, in accordance with Section
4.12(e), (f), (g) and (h). To the extent that any portion of the Excess Proceeds
remains after compliance with the preceding sentence and provided that all
Holders have been given the opportunity to tender the Securities for repurchase
in accordance with this Indenture, the Company or such Restricted Subsidiary may
use such remaining amount for any purpose permitted by this Indenture and the
amount of Excess Proceeds shall be reset to zero. Pending application of Net
Proceeds pursuant to clause (A) and (B) of Section 4.12(c) above, such Net
Proceeds will be invested in Temporary Cash Investments. Notwithstanding the
foregoing, the Company shall not be required to make a Prepayment Offer if the
purchase of the Securities is prohibited by the terms of the Xxxx Notes, but
only to the extent and for so long as such purchase of the Securities is
prohibited.
(e) Within 10 Business Days after the Company is required to make a
Prepayment Offer, the Company shall send a written notice (the "Prepayment Offer
Notice"), by first-class mail, to the Holders (a copy of which is to be sent to
the Trustee), accompanied by such information regarding the Company and its
Subsidiaries as the Company in good faith believes will enable such Holders to
make an informed decision with respect to the Prepayment Offer. The Prepayment
Offer Notice will state, among other things, (i) that the Company is offering to
purchase Securities
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pursuant to Section 4.12, (ii) that any Security (or any portion thereof)
accepted for payment (and for which payment has been duly provided on the
Purchase Date) pursuant to the Prepayment Offer shall cease to accrue interest
after the Purchase Date, (iii) the purchase price and purchase date, which shall
be, subject to any contrary requirements of applicable law, no less than 30 days
nor more than 60 days from the date the Prepayment Offer Notice is mailed (the
"Purchase Date"), (iv) the aggregate principal amount of Securities (or portions
thereof) to be purchased and (v) a description of the procedure which Holders
must follow in order to tender their Securities (or portions thereof) and the
procedures that Holders must follow in order to withdraw an election to tender
their Securities (or portions thereof) for payment.
(f) Not later than the Business Day prior to the Purchase Date, the
Company shall irrevocably deposit with the Trustee or with the Paying Agent (or,
if the Company is acting as its own paying agent, segregate and hold in trust)
in Temporary Cash Investments an amount equal to the purchase price plus accrued
and unpaid interest, if any, to the Holders entitled thereto, to be held for
payment in accordance with the provisions of this Section. Holders electing to
have a Security purchased will be required to surrender the Security, with an
appropriate form duly completed, to the Company at the address specified in the
notice at least five Business Days prior to the Purchase Date. Holders will be
entitled to withdraw their election if the Trustee or the Company receives not
later than three Business Days prior to the Purchase Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Security which was delivered for purchase by the Holder,
the certificate number of such Security and a statement that such Holder is
withdrawing his election to have such Security purchased.
(g) On the Business Day prior to the Purchase Date, the Company
shall deliver to the Trustee the Securities or portions thereof which have been
properly tendered to and are to be accepted by the Company. The Trustee (or
Paying Agent) shall, on the Purchase Date, mail or deliver payment of the
purchase price to each tendering Holder. In the event that the aggregate
purchase price of the Securities delivered by the Company to the Trustee is less
than the amount deposited with the Trustee (or Paying Agent), the Trustee (or
Paying Agent) shall deliver the excess to the Company immediately after the end
of the Purchase Date.
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(h) The Company will comply, to the extent applicable, with the
requirements of Rule 14e-1 under the Exchange Act, and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable in connection with the purchase of Securities required by this
Section. To the extent that the provisions of any securities laws or regulations
conflict with the provisions relating to the Prepayment Offer, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations described above by virtue thereof.
SECTION 4.13. Limitation on Layered Indebtedness. The Company shall
not, directly or indirectly, Incur any Indebtedness which is subordinate or
junior in right of payment to any Senior Indebtedness unless such Indebtedness
is Senior Subordinated Indebtedness or is expressly subordinated in right of
payment to Senior Subordinated Indebtedness. The Company shall not permit any of
its Restricted Subsidiaries to issue any Guarantee with respect to any Senior
Subordinated Indebtedness or Subordinated Obligations of the Company unless such
Restricted Subsidiary has executed and delivered to the Trustee a supplemental
indenture pursuant to which such Restricted Subsidiary will Guarantee payment of
the Securities on terms and conditions (including with respect to any Liens
securing such Guarantees) at least as favorable to the holders of the Securities
as such Guarantee and (a) in the case of Senior Subordinated Indebtedness, such
Guarantee (and related Liens, if any) shall rank pari passu with such Guarantee
of the Securities and (b) in the case of Subordinated Obligations, such
Guarantee (and related Liens, if any) shall be subordinated in right of payment
to such Guarantee of the Securities to at least the same extent as such
Subordinated Obligations are subordinated to the Securities.
SECTION 4.14. Maintenance of Properties and Other Matters. (a) The
Company shall, and shall cause each of its Subsidiaries to, maintain its
Properties in good working order and condition and make all necessary repairs,
renewals and replacements; provided, however, that nothing in this Section 4.14
shall prevent the Company or any of its Subsidiaries from discontinuing the
operation and maintenance of any of its Properties, if such discontinuance is,
in the judgment of the Company, both desirable in the conduct of the business of
the Company and its Subsidiaries, taken as a whole, and not disadvantageous in
any material respect to the Holders.
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(b) The Company shall, and shall cause each of its Subsidiaries to,
insure and keep insured, with financially sound and reputable insurers, so much
of their respective Properties and in such amounts as is usually and customarily
insured by Persons engaged in a similar business with respect to Properties of a
similar character against loss by fire and the extended coverage perils. None of
the Company or any of its Subsidiaries shall maintain a system of self-insurance
in lieu of or in combination with the foregoing insurance with respect to its
Properties; provided that deductibles under the insurance policy or policies of
the Company and its Subsidiaries shall not be considered to be self-insurance as
long as such deductibles accord with financially sound and approved practices of
Persons owning or operating Properties of a similar character and maintaining
similar insurance coverage.
(c) The Company shall, and shall cause each of its Subsidiaries to,
keep proper books and records of accounts in which full and correct entries will
be made of all its business transactions in accordance with GAAP. The Company
shall cause the books and records of accounts of the Company and its
Subsidiaries to be examined, either on a consolidated or on an individual basis,
by one or more firms of independent public accountants not less frequently than
annually. The Company shall, and shall cause each of its Subsidiaries to,
prepare its financial statements in accordance with GAAP.
(d) The Company shall, and shall cause each of its Subsidiaries to,
comply with all Legal Requirements and to obtain any licenses, permits,
franchises or other authorizations, including Gaming Licenses, from Governmental
Authorities necessary to the ownership or operation of its Properties or to the
conduct of its business.
(e) Notwithstanding the provisions of Section 4.14(a), (b), (c) or
(d), failure by the Company or any of its Subsidiaries to comply with such
provisions shall not be deemed to be a breach of such provisions to the extent
that such failure would not have a material adverse effect on the Company and
its Subsidiaries, taken as a whole.
SECTION 4.15. Limitation on Activities of the Company. The Company
shall not, and shall not permit any of its Restricted Subsidiaries to, engage in
(through acquisition or otherwise) any business other than a Related Business.
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SECTION 4.16. Agreement to Redeem the CHFC Notes. The Company shall
cause CHFC to take all action required pursuant to the CHFC Indenture in order
to redeem the CHFC Notes on December 1, 1997, and shall cause CHFC to effect
such redemption on such date; provided, however, that the Company's obligation
under this Section 4.16 shall be suspended if the Board of Directors shall have
determined in good faith that the Company expects to be unable to borrow under
the Credit Facility the amounts required to fund such redemption on the
redemption date, as evidenced by a Board Resolution delivered to the Trustee.
The Company's obligation under this Section 4.16 shall be reinstated upon a
determination by the Board of Directors that the required amounts are expected
to be available under the Credit Facility for a period of at least 45 days, at
which time the Company shall cause CHFC to give the required notice of
redemption and redeem the CHFC Notes as promptly as it is permitted to do so
under the CHFC Indenture. During any period when the Company's obligation under
this covenant is suspended, the Board of Directors shall reconsider the
determination referred to in the first sentence of this Section 4.16 no less
frequently than monthly.
ARTICLE V
Successor Company
SECTION 5.01. When Company May Merge or Transfer Assets. The Company
shall not merge or consolidate with or into any other entity (other than a
merger or consolidation of a Restricted Subsidiary with or into the Company) or
in one transaction or a series of related transactions sell, convey, assign,
transfer, lease or otherwise dispose of all or substantially all of its Property
unless: (i) the entity formed by or surviving any such consolidation or merger
(if the Company is not the surviving entity) or the Person to which such sale,
assignment, transfer, lease or conveyance is made (the "Successor") (a) shall be
a corporation organized and existing under the laws of the United States of
America or a State thereof or the District of Columbia and such corporation
expressly assumes, by supplemental indenture satisfactory to the Trustee,
executed and delivered to the Trustee by such corporation, the due and punctual
payment of the principal, premium, if any, and interest on all the Securities,
according to their tenor, and the due and punctual performance and observance of
all the covenants and conditions of this Indenture to be performed by the
Company and (b) the Successor shall have
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all Gaming Licenses required to operate all Gaming Facilities to be owned by
such Successor; (ii) in the case of a sale, transfer, assignment, lease,
conveyance or other disposition of all or substantially all of the Company's
Property, such Property shall have been transferred as an entirety or virtually
as an entirety to one Person; (iii) immediately before and after giving effect
to such transaction or series of transactions on a pro forma basis, no Default
or Event of Default shall have occurred and be continuing; (iv) immediately
after giving effect to such transaction or series of transactions on a pro forma
basis (including, without limitation, any Indebtedness Incurred or anticipated
to be Incurred in connection with such transaction or series of transactions),
the Company or the Successor, as the case may be, would be able to Incur at
least $1.00 of additional Indebtedness under Section 4.04(a); and (v)
immediately after giving effect to such transaction or series of transactions on
a pro forma basis including, without limitation, any Indebtedness Incurred or
anticipated to be Incurred in connection with such transaction or series of
transactions), the Company or the Successor shall have a Consolidated Net Worth
equal to or greater than the Consolidated Net Worth of the Company immediately
prior to the transaction or series of transactions.
The Successor shall be the successor to the Company and shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture, but the predecessor Company in the case of a
conveyance, transfer or lease shall not be released from the obligation to pay
the principal of and interest on the Securities.
ARTICLE VI
Defaults and Remedies
SECTION 6.01. Events of Default. The following events shall be
"Events of Default":
(i) default with respect to payment of interest on any of the
Securities when it becomes due and payable, and the continuance of such
default for a period of 30 days;
(ii) default with respect to payment of principal or premium, if
any, on any of the Securities when due
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at maturity, upon acceleration, required purchase or
otherwise;
(iii) failure by the Company to observe, perform or comply with
Article V herein;
(iv) failure by the Company to observe, perform or comply with any
of the other covenants and agreements in this Indenture and such failure
to observe, perform or comply continues for a period of 30 days after
receipt by the Company of a written notice from the Trustee or Holders of
not less than 25% of aggregate principal amount of the Securities then
outstanding;
(v) Indebtedness of the Company or any Restricted Subsidiary is not
paid when due within any applicable grace period or is accelerated by the
holders thereof and, in either case, the total amount of such unpaid or
accelerated Indebtedness exceeds $10 million;
(vi) the entry by a court of competent jurisdiction of one or more
judgments or orders against the Company or any Restricted Subsidiary in an
uninsured aggregate amount in excess of $10 million and such judgment or
order is not discharged, waived, stayed or satisfied for a period of 60
consecutive days;
(vii) the Company or any Restricted Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against
it in an involuntary case;
(C) consents to the appointment of a Custo xxxx of it or
for any substantial part of its property; or
(D) makes a general assignment for the bene fit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
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(viii) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Restricted
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any
Restricted Subsidiary or for any substantial part of its property;
or
(C) orders the winding up or liquidation of the Company
or any Restricted Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days; and
(ix) any revocation, suspension or loss of any Gaming License which
results in the cessation of business for a period of more than 90
consecutive days of the business of any Material Gaming Facility owned,
leased or operated directly or indirectly by the Company or any of its
Subsidiaries or Permitted Joint Ventures (other than any voluntary
relinquishment of a Gaming License if such relinquishment is, in the
reasonable, good faith judgment of the Board of Directors, evidenced by a
Board Resolution, both desirable in the conduct of the business of the
Company and its Subsidiaries and Permitted Joint Ventures, taken as a
whole, and not disadvantageous in any material respect to the Holders).
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
A Default under clause (iv), (v), (vi) or (ix) is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount of
the Securities notify the Company of the Default and the Company does not cure
such Default within the time specified after receipt of such
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notice. Such notice must specify the Default, demand that it be remedied and
state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default, its status and what action the Company is taking or
proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default with respect to
the Securities (other than an Event of Default resulting from Section 6.01(vii)
or (viii)) shall have occurred and be continuing, the Trustee or the registered
holders of not less than 25% in aggregate principal amount of the Securities
then outstanding may accelerate the maturity of all the Securities in which
event the Securities shall become immediately due and payable; provided,
however, that after such acceleration but before a judgment or decree based on
acceleration is obtained by the Trustee, the registered holders of a majority in
aggregate principal amount of the Securities then outstanding, may, under
certain circumstances, rescind and annul such acceleration if all Events of
Default, other than the nonpayment of accelerated principal, have been cured or
waived as provided in this Indenture. In case an Event of Default resulting from
Section 6.01(vii) or (viii) shall occur, the Securities shall be due and payable
immediately without any declaration or other act on the part of the Trustee or
the Holders.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquies cence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (i) a Default in the payment of the
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principal of or interest on a Security or (ii) a Default in respect of a
provision that under Section 9.02 cannot be amended without the consent of each
Securityholder affected. When a Default is waived, it is deemed cured, but no
such waiver shall extend to any subsequent or other Default or impair any
consequent right.
SECTION 6.05. Control by Majority. The Holders of a majority in
principal amount of the Securities may direct the time, method and place of
conducting any proceed ing for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Securityholders or would involve the Trustee in personal
liability; provided, however, that the Trustee may take any other action deemed
proper by the Trustee, including pursuant to Section 7.01(a), that is not
inconsistent with such direction. Prior to taking any action hereunder, the
Trustee shall be entitled to indemni fication satisfactory to it in its sole
discretion against all losses and expenses caused by taking or not taking such
action.
SECTION 6.06. Limitation on Suits. No Holder will have any right to
institute any proceeding with respect to this Indenture or for any remedy
thereunder, unless: (i) such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default; (ii) Holders of at least 25% in
aggregate principal amount of the Securities then outstanding shall have made
written request and offered reasonable indemnity to the Trustee to institute
such proceeding as a trustee; and (iii) the Trustee shall not have received from
the Holders of a majority in aggregate principal amount of the Securities then
outstanding a direction inconsistent with such request and shall have failed to
institute such proceeding within 60 days. However, such limitations do not apply
to a suit instituted by a Holder for enforcement of payment of the principal of
and premium, if any, or interest on such Security on or after the respective due
dates expressed in such Security.
A Securityholder may not use this Indenture to prejudice the rights
of another Securityholder or to obtain a preference or priority over another
Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment. Notwithstanding
any other provision of this Inden-
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ture, the right of any Holder to receive payment of princi pal of and interest
on the Securities held by such Holder, on or after the respective due dates
expressed in the Secu rities, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default in
payment of interest or principal speci fied in Section 6.01(1) or (2) occurs and
is continuing, the Trustee may recover judgment in its own name and as trustee
of an express trust against the Company for the whole amount of principal and
interest remaining unpaid (together with interest on such unpaid interest to the
extent lawful) and the amounts provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in bankruptcy or other
Person performing similar functions, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder to make payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due it for the
reasonable compensation, expenses, disburse ments and advances of the Trustee,
its agents and its counsel, and any other amounts due the Trustee under Section
7.07.
SECTION 6.10. Priorities. If the Trustee col lects any money or
property pursuant to this Article VI, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Sec tion 7.07;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Securi ties for
principal and interest, respectively; and
THIRD: to the Company.
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The Trustee may fix a record date and payment date for any payment
to Securityholders pursuant to this Section. At least 15 days before such record
date, the Company shall mail to each Securityholder and the Trustee a notice
that states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Inden ture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including rea sonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by
Holders of more than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. The Company (to the
extent it may lawfully refrain from doing so) shall not at any time insist upon,
or plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, which may affect the covenants or the performance of this Indenture; and
the Company (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and shall not hinder, delay or impede
the execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
ARTICLE VII
Trustee
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default: (1) the
Trustee undertakes to perform such duties
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and only such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture against the
Trustee; and (2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. However, the
Trustee shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabil ity for its own
negligent action, its own negligent failure to act or its own wilful misconduct,
except that: (1) this paragraph does not limit the effect of paragraph (b) of
this Section; (2) the Trustee shall not be liable for any error of judgment made
in good faith by a duly authorized officer of the Trustee (a "Trust Officer")
unless it is proved that the Trustee was negligent in ascertaining the pertinent
facts; and (3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
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SECTION 7.02. Rights of Trustee. (a) The Trustee may rely on any
document or any other writing believed by it to be genuine and to have been
signed or presented by the proper person. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opin ion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute wilful
misconduct or negligence.
(e) The Trustee may consult with counsel, and the advice or opinion
of counsel with respect to legal matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it here under
in good faith and in accordance with the advice or opinion of such counsel.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Secur ities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in this Inden ture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
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SECTION 7.05. Notice of Defaults. If a Default occurs and is
continuing and if it is known to the Trustee, the Trustee shall mail to each
Securityholder notice of the Default within 90 days after it occurs. Except in
the case of a Default in payment of principal of or interest on any Security
(including payments pursuant to the mandatory redemption provisions of such
Security, if any), the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of May 15 that
complies with TIA Section 313(a). The Trustee also shall comply with TIA Section
313(b).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the Commission and each stock exchange (if any) on which the
Securities are listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange and of any delisting
thereof.
SECTION 7.07. Compensation and Indemnity. The Company shall pay to
the Trustee from time to time rea sonable compensation for its services. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall xxxx xxxxx the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company shall indemnify the Trustee (or any predecessor Trustee)
and its agents against, and hold it harmless for, any and all loss, liability or
expense (including attorneys' fees and expenses) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder, except to the extent that such loss, damage, claim,
liability or expense is due to its own negligence or bad faith. The Trustee
shall notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company
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shall not relieve the Company of its obligations hereunder. The Company shall
defend the claim and the Trustee may have separate counsel and the Company shall
pay the fees and expenses of such counsel. The Company need not reimburse any
expense or indemnify against any loss, liability or expense incurred by the
Trustee through the Trustee's own wilful misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on Securities under Article VIII or otherwise.
The Company's payment obligations pursuant to this Section shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(vii) or (viii) with
respect to the Company, the expenses are intended to constitute expenses of
administration under Bankruptcy Law; provided, however, that, if such amounts
are paid as expenses of administration, they shall be paid in accordance with
Section 6.10.
SECTION 7.08. Replacement of Trustee. The Trustee may resign at any
time by so notifying the Company. The Holders of a majority in principal amount
of the Secur ities may remove the Trustee by so notifying the Trustee and may
appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders
of a majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 7.07.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
25% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appoint ment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust busi ness or assets to, another corporation or banking
associa tion, the resulting, surviving or transferee corporation or banking
association without any further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
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SECTION 7.10. Eligibility; Disqualification. The Trustee shall at
all times satisfy the requirements of TIA Section 310(a). The Trustee shall have
a combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition. No obligor upon the Securities or
Person directly controlling, controlled by, or under common control with such
obligor shall serve as Trustee upon the Securities. The Trustee shall comply
with TIA Section 310(b); provided, however, that there shall be excluded from
the operation of TIA Section 310(b)(1) any indenture or indentures under which
other securities or certificates of interest or participation in other
securities of the Company are out standing if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
SECTION 7.12. Trustee's Application for Instructions from the
Company. Any application by the Trustee for written instructions from the
Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
three Business Days after the date any officer of the Company actually receives
such application, unless any such officer shall have consented in writing to any
earlier date) unless prior to taking any such action (or the effective date in
the case of an omission), the Trustee shall have received written instructions
in response to such application specifying the action to be taken or omitted.
ARTICLE VIII
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Securi ties; Defeasance. (a)
When (i) the Company delivers to the Trustee all outstanding Securities (other
than Securities
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replaced pursuant to Section 2.06) for cancelation or (ii) all outstanding
Securities have become due and payable, and the Company irrevocably deposits
with the Trustee funds sufficient to pay at maturity or upon redemption all out
standing Securities, including interest thereon (other than Securities replaced
pursuant to Section 2.06), and if in either case the Company pays all other sums
payable here under by the Company, then this Indenture shall, subject to
Sections 8.01(c) and 8.06, cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.
(b) Subject to Sections 8.01(c), 8.02 and 8.06, the Company at any
time may terminate (i) all its obliga tions under the Securities and this
Indenture ("legal defeasance option") or (ii) its obligations under Sections
4.01, 4.03 (to the extent that the failure to comply with such Section 4.03
shall not violate the TIA), 4.04, 4.05, 4.06, 4.07, 4.10, 4.11, 4.12, 4.13,
4.14, 4.15, 4.16 and Article V and the related operation of Section 6.01(iii)
and (iv), and the operation of Sections 6.01(v), (vi), (vii) (with respect to
Restricted Subsidiaries), (viii) (with respect to Restricted Subsidiaries), (ix)
or (x) ("covenant defeasance option"). The Company may exercise its legal
defeasance option not withstanding its prior exercise of its covenant defeasance
option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Section 6.01(iii), (iv),
(v), (vi), (vii) (with respect to Restricted Subsidiaries), (viii) (with respect
to Restricted Subsidiaries) or (ix) (except to the extent covenants or
agreements referenced in such Sections remain applicable).
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 7.07, 7.08, 8.04, 8.05 and 8.06
shall survive until the Securities have been paid in full. Thereafter, the
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Company's obligations in Sections 7.07, 8.04 and 8.05 shall survive.
SECTION 8.02. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee money
or U.S. Government Obligations for the payment of principal and interest
on the Securities to maturity or redemption, as the case may be;
(2) the Company delivers to the Trustee a cer tificate from a
nationally recognized firm of indepen dent accountants expressing their
opinion that the pay ments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obliga tions plus any
deposited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay principal and interest when due
on all the Securities to maturity or redemption, as the case may be;
(3) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Section 6.01(vii) or (viii) with respect to
the Company occurs which is continuing at the end of the period;
(4) no Default has occurred and is continuing on the date of such
deposit and after giving effect thereto;
(5) the deposit does not constitute a default under any other
agreement binding on the Company ;
(6) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not constitute, or
is qualified as, a regulated investment company under the Investment
Company Act of 1940;
(7) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel stating that (i) the
Company has received from the Internal Revenue Service a ruling, or (ii)
since the date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Securityholders
will not recognize income, gain or loss
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for Federal income tax purposes as a result of such defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such defeasance had not
occurred;
(8) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that the
Security holders will not recognize income, gain or loss for Federal
income tax purposes as a result of such cove nant defeasance and will be
subject to Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such covenant defeasance
had not occurred; and
(9) the Company delivers to the Trustee an Offi cers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent to
the defeasance and discharge of the Securities as contemplated by this
Article VIII have been complied with.
SECTION 8.03. Application of Trust Money. The Trustee shall hold in
trust money or U.S. Government Obliga tions deposited with it pursuant to this
Article VIII. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal of and interest on the Securities.
SECTION 8.04. Repayment to Company. The Trustee and the Paying Agent
shall promptly turn over to the Company upon written request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and
the Paying Agent shall pay to the Company upon request any money held by them
for the payment of principal or interest that remains unclaimed for two years,
and, thereafter, Securityholders entitled to the money must look to the Company
for payment as general creditors.
SECTION 8.05. Indemnity for Government Obliga tions. The Company
shall pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations.
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SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Article VII by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restrain ing or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article VIII until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article VIII.
ARTICLE IX
Amendments
SECTION 9.01. Without Consent of Holders. The Company and the
Trustee may amend this Indenture or the Securities without notice to or consent
of any Security holder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article V;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Sec tion 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees by Subsidiaries with respect to the Securities
and to release such Guarantees when required by the terms thereof;
(5) to secure the Securities;
(6) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Company;
(7) to comply with any requirements of the Commission in connection
with qualifying this Indenture under the TIA; or
(8) to make any change that does not adversely affect the rights of
any Securityholder.
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After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 9.02. With Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without notice to any Securityholder
but with the written consent of the Holders of at least a majority in principal
amount of the Securities. However, without the consent of each Securityholder
affected, an amendment may not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the rate of or extend the time for payment of interest on
any Security;
(3) reduce the principal of or extend the Stated Maturity of any
Security;
(4) reduce the premium payable upon the redemption of any Security
or change the time at which any Secur ity may be redeemed in accordance
with Article III;
(5) make any Security payable in money other than that stated in the
Security;
(6) impair the right of any Holder to receive payment of principal
of and interest on such Holder's Securities 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 Securities; or
(7) make any change to Article X that would adversely affect the
holders of the Securities, subordinate in right of payment, or otherwise
subordinate, the Securities to any other obligation of the Company.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a
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notice briefly describing such amendment. The failure to give such notice to all
Securityholders, or any defect therein, shall not impair or affect the validity
of an amendment under this Section.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment
to this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subse xxxxx Xxxxxx of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subse xxxxx Xxxxxx may revoke the consent or waiver as to such
Holder's Security or portion of the Security if the Trustee receives the notice
of revocation before the date the amendment or waiver becomes effective. After
an amendment or waiver becomes effective, it shall bind every Security holder.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or to take any such action, whether or not such Persons
continue to be Holders after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
SECTION 9.05. Notation on or Exchange of Securi ties. If an
amendment changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
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SECTION 9.06. Trustee To Sign Amendments. The Trustee shall sign any
amendment authorized pursuant to this Article IX if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In sign ing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such (i)
amendment is authorized or permitted by this Indenture and that all conditions
precedent to the execution, delivery and performance of such amendment have been
satisfied; (ii) the Company has all necessary corporate power and authority to
execute and deliver the amendment and that the execution, delivery and
performance of such amendment has been duly authorized by all necessary
corporate action; (iii) the execution, delivery and performance of the amendment
do not conflict with, or result in the breach of or constitute a default under
any of the terms, conditions or provisions of (a) this Indenture, (b) the
Certificate of Incorporation or By-Laws of the Company, (c) any law or
regulation applicable to the Company, (d) any material order, writ, injunction
or decree of any court or governmental instrumentality applicable to the Company
or (e) any material agreement or instrument to which the Company is subject;
(iv) such amendment has been duly and validly executed and delivered by the
Company, and this Indenture together with such amendment constitutes a legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and general equitable principles; and (v) this
Indenture together with such amendment complies with the TIA.
SECTION 9.07. Payment for Consent. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE X
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Subordination
SECTION 10.01. Agreement To Subordinate. The Company agrees, and
each Securityholder by accepting a Security agrees, that the Indebtedness
evidenced by the Securities is subordinated in right of payment, to the extent
and in the manner provided in this Article X, to the prior payment of all Senior
Indebtedness of the Company and that the subordination is for the benefit of and
enforceable by the holders of such Senior Indebtedness. The Securities shall in
all respects rank pari passu with all other Senior Subordinated Indebtedness of
the Company and only Senior Indebtedness of the Company shall rank senior to the
Securities in accordance with the provisions set forth herein. All provisions of
this Article X shall be subject to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bank ruptcy. Upon any
payment or distribution of the assets of the Company to creditors upon a total
or partial liquidation or a total or partial dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property:
(1) holders of Senior Indebtedness of the Company shall be entitled
to receive payment in full in cash or cash equivalents of such Senior
Indebtedness before Securityholders shall be entitled to receive any
payment of principal of or interest on the Securities; and
(2) until such Senior Indebtedness is paid in full in cash or cash
equivalents, any distribution to which Securityholders would be entitled
but for this Article X all be made to holders of such Senior Indebtedness
as their interests may appear;
except that Securityholders may receive shares of stock and any debt securities
that are subordinated to Senior Indebtedness, and to any debt securities
received by holders of Senior Indebtedness, of the Company to at least the same
extent as the Securities.
SECTION 10.03. Default on Senior Indebtedness. The Company may not
pay the principal of or interest on the Securities or make any deposit pursuant
to Section 8.01 and may not repurchase, redeem or otherwise retire any
Securities (collectively, "pay the Securities") if (i) any principal, premium or
interest in respect of any Senior Indebtedness is not paid within any applicable
grace period
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(including at maturity) or (ii) any other default on Senior Indebtedness occurs
and the maturity of such Senior Indebtedness is accelerated in accordance with
its terms unless, in either case, (x) the default has been cured or waived and
any such acceleration has been rescinded or (y) such Senior Indebtedness has
been paid in full in cash or cash equivalents; provided, however, that the
Company may pay the Securities without regard to the foregoing if the Company
and the Trustee receive written notice approving such payment from the
Representative of each issue of Designated Senior Indebtedness. During the
continuance of any default (other than a default described in clause (i) or (ii)
of the preceding sentence) with respect to any Designated Senior Indebtedness
pursuant to which the maturity thereof may be accelerated immediately without
further notice (except such notice as may be required to effect such
acceleration), the Company may not pay the Securities for a period (a "Payment
Blockage Period") commencing upon the receipt by the Company and the Trustee of
written notice of such default from the Representative of such Designated Senior
Indebtedness specifying an election to effect a Payment Blockage Period (a
"Payment Blockage Notice") and ending 179 days thereafter (or earlier if such
Payment Blockage Period is terminated (i) by written notice to the Trustee and
the Company from the Representative who gave such Payment Blockage Notice, (ii)
by repayment in full in cash or cash equivalents of such Designated Senior
Indebtedness or (iii) because the default giving rise to such Payment Blockage
Notice is no longer continuing). Notwithstanding the provisions described in the
immediately preceding sentence, unless the holders of such Designated Senior
Indebtedness or the Representative of such holders shall have accelerated the
maturity of such Designated Senior Indebtedness and not rescind such
acceleration, the Company may (unless otherwise prohibited pursuant to the first
sentence of this Section 10.03) resume payments on the Securities after such
Payment Blockage Period. Not more than one Payment Blockage Notice with respect
to all issues of Designated Senior Indebtedness may be given in any consecutive
360-day period, irrespective of the number of defaults with respect to one or
more issues of Designated Senior Indebtedness during such period.
SECTION 10.04. Acceleration of Payment of Securities. If payment of
the Securities is accelerated because of an Event of Default, the Company or the
Trustee shall promptly notify the holders of the Designated Senior Indebtedness
(or their Representatives) of the acceleration.
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SECTION 10.05. When Distribution Must Be Paid Over. If a
distribution is made to Securityholders that because of this Article X should
not have been made to them, the Securityholders who receive the distribution
shall hold such distribution in trust for holders of Senior Indebtedness of the
Company and pay it over to such holders as their interests may appear.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the
Company is paid in full in cash or cash equivalents and until the Securities are
paid in full, Securityholders shall be subrogated to the rights of holders of
such Senior Indebtedness to receive distributions applicable to such Senior
Indebtedness. A distribution made under this Article X to holders of such Senior
Indebtedness which otherwise would have been made to Securityholders is not, as
between the Company and Securityholders, a payment by the Company on such Senior
Indebtedness.
SECTION 10.07. Relative Rights. This Article X defines the relative
rights of Securityholders and holders of Senior Indebtedness of the Company.
Nothing in this Indenture shall:
(1) impair, as between the Company and Secu rityholders, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Securities in accordance with their
terms; or
(2) prevent the Trustee or any Securityholder from exercising its
available remedies upon a Default or an Event of Default, subject to the
rights of holders of Senior Indebtedness of the Company to receive distri
butions otherwise payable to Securityholders.
SECTION 10.08. Subordination May Not Be Impaired by Company. No
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
by any act or failure to act by the Company or by its failure to comply with
this Indenture.
SECTION 10.09. Rights of Trustee and Paying Agent. Notwithstanding
Section 10.03, the Trustee or Paying Agent may continue to make payments on the
Securities and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Trust Officer receives notice
that payments
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may not be made under this Article X. The Company, the Registrar or
co-registrar, the Paying Agent, a Representative or a holder of Senior
Indebtedness may give the notice; provided, however, that, if an issue of Senior
Indebtedness of the Company has a Representative, only the Representative may
give the notice on behalf of the holders of such Senior Indebtedness.
The Trustee in its individual or any other capa city may hold Senior
Indebtedness of the Company with the same rights it would have if it were not
Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article X with respect to any Senior Indebtedness of the Company which may
at any time be held by it, to the same extent as any other holder of such Senior
Indebtedness; and nothing in Article VII shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article X shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to Repre sentative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Company, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article X Not To Prevent Events of Default or Limit
Right To Accelerate. The failure to make a payment pursuant to the Securities by
reason of any provision in this Article X shall not be construed as pre venting
the occurrence of a Default. Nothing in this Article 10 shall have any effect on
the right of the Secu rityholders or the Trustee to accelerate the maturity of
the Securities.
SECTION 10.12. Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article VIII by the Trustee
for the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Senior Indebtedness or subject to the
restrictions set forth in this Article X, and none of the Securityholders shall
be obligated to pay over any such amount to the Company or any holder of Senior
Indebtedness of the Company or any other creditor of the Company.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or
distribution pursuant to this Article X, the
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Trustee and the Securityholders shall be entitled to rely (i) upon any order or
decree of a court of competent juris diction in which any proceedings of the
nature referred to in Section 10.02 are pending, (ii) upon a certificate of the
liquidating trustee or agent or other Person making such payment or distribution
to the Trustee or to the Security holders or (iii) upon the Representatives for
the holders of Senior Indebtedness of the Company for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of such Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
X. In the event that the Trustee determines, in good faith, that evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness of the Company to participate in any payment or distribution
pursuant to this Article X, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article X, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment. The provisions of Sections 7.01 and 7.02 shall be applicable to all
actions or omissions of actions by the Trustee pursuant to this Article X.
SECTION 10.14. Trustee To Effectuate Subordina tion. Each
Securityholder by accepting a Security author izes and directs the Trustee on
his behalf to take such action as may be necessary or appropriate to acknowledge
or effectuate the subordination between the Securityholders and the holders of
Senior Indebtedness of the Company as provided in this Article X and appoints
the Trustee as attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall mistakenly pay over or distribute to Securityholders or the Company or any
other Person, money or assets to which any holders of Senior Indebtedness of the
Company shall be entitled by virtue of this Article X or otherwise.
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SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Securityholder by accepting a Security
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of the Company, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Securities, to acquire and continue
to hold, or to continue to hold, such Senior Indebtedness and such holder of
such Senior Indebtedness shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness.
SECTION 10.17. Certain Payments. Nothing in this Article 10 shall
prevent or delay (i) the Company from or in redeeming any Securities pursuant to
paragraph 6 of the Securities or otherwise purchasing any Securities pursuant to
any Legal Requirement relating to the gaming business of the Company and its
Subsidiaries or (ii) the receipt by the Holders of payments of principal of and
interest on the Securities as provided in Section 8.03.
ARTICLE XI
Miscellaneous
SECTION 11.01. Trust Indenture Act Controls. If and to the extent
that any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by, or with another provision (an "incorporated provision")
included in this Indenture by operation of, Sections 310 to 318, inclusive, of
the TIA, such imposed duties or incorporated provision shall control.
SECTION 11.02. Notices. Any notice or communica tion shall be in
writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company:
Xxxx Gaming Corporation
0000 Xxxxx Xxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxx 00000
Attention of Office of the Secretary
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if to the Trustee:
State Street Bank and Trust Company
Corporate Trust Department
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xx. Xxxxxx XxxXxxxxx
The Company or the Trustee by notice to the other may designate
additional or different addresses for subse quent notices or communications.
Any notice or communication mailed to a Security holder shall be
mailed to the Securityholder at the Secu rityholder's address as it appears on
the registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 11.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
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SECTION 11.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 11.06. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of Securityholders.
The Registrar and the Paying Agent may make reasonable rules for their
functions.
SECTION 11.07. Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open in
the State of New York. If a payment date is a Legal Holiday, payment shall be
made on the next succeeding day that is not a Legal Holiday, and no interest
shall accrue for the intervening period. If a regular record date is a Legal
Holiday, the record date shall not be affected.
SECTION 11.08. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW
TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
SECTION 11.09. No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security,
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each Securityholder shall waive and release all such lia bility. The waiver and
release shall be part of the consi deration for the issue of the Securities.
SECTION 11.10. Successors. All agreements of the Company in this
Indenture and the Securities shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.
SECTION 11.11. Multiple Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.
SECTION 11.12. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
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.
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SECTION 11.13. Severability. In case any provision in this Indenture
or in the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
IN WITNESS WHEREOF, the parties have caused this Indenture to be
duly executed as of the date first written above.
XXXX GAMING CORPORATION,
by
-------------------------------
Name:
Title:
STATE STREET BANK AND TRUST
COMPANY,
by
-------------------------------
Name:
Title:
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APPENDIX A
FOR OFFERINGS TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT
TO RULE 144A AND TO CERTAIN PERSONS IN OFFSHORE
TRANSACTIONS IN RELIANCE ON REGULATION S.
PROVISIONS RELATING TO INITIAL SECURITIES
AND EXCHANGE SECURITIES
1. Definitions
1.1 Definitions
For the purposes of this Appendix A the following terms shall have the
meanings indicated below:
"Definitive Security" means a certificated Initial Security bearing
the restricted securities legend set forth in Section 2.3(d) and which is held
by an IAI in accordance with Section 2.1(c).
"Depository" means The Depository Trust Company, its nominees and
their respective successors.
"Exchange Securities" means the 9.50% Senior Subordinated Notes Due
2007 to be issued pursuant to this Indenture in connection with a Registered
Exchange Offer pursuant to the Registration Agreement.
"Initial Purchasers" means Salomon Brothers Inc, UBS Securities LLC
and CIBC Wood Gundy Securities Corp.
"Initial Securities" means the 9.50% Senior Subordinated Notes Due
2007, issued under this Indenture on or about the date hereof.
"Purchase Agreement" means the Purchase Agreement dated July 17,
1997, among the Company and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Registered Exchange Offer" means the offer by the Company, pursuant
to the Registration Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.
"Registration Agreement" means the Registration Agreement dated July
17, 1997, among the Company and the Initial Purchasers.
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"Securities" means the Initial Securities and the Exchange
Securities, treated as a single class.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depository), or any successor person thereto and
shall initially be the Trustee.
"Shelf Registration Statement" means the registration statement
issued by the Company in connection with the offer and sale of Initial
Securities pursuant to the Registration Agreement.
"Transfer Restricted Securities" means Definitive Securities and
Securities that bear or are required to bear the legend set forth in Section
2.3(d) hereto.
1.2 Other Definitions
Defined in
Term Section:
---- ----------
"Agent Members"................................................... 2.1(b)
"Global Security"................................................. 2.1(a)
"Regulation S".................................................... 2.1(a)
"Rule 144A"....................................................... 2.1(a)
2. The Securities
2.1 Form and Dating
The Initial Securities are being offered and sold by the Company
pursuant to the Purchase Agreement.
(a) Global Securities. Initial Securities offered and sold to a QIB
in reliance on Rule 144A under the Securities Act ("Rule 144A") or in reliance
on Regulation S under the Securities Act ("Regulation S"), in each case as
provided in the Purchase Agreement, shall be issued initially in the form of one
or more permanent global Securities in definitive, fully registered form without
interest coupons with the global securities legend and restricted securities
legend set forth in Exhibit 1 hereto (each, a "Global Security"), which shall be
deposited on behalf of the purchasers of the Initial Securities represented
thereby with the Trustee, as custodian for the Depository (or with such other
custodian as the Depository may direct), and registered in the name of the
Depository or a nominee of the Depository, duly executed by the Company and
authenticated by the Trustee as provided in the Indenture. The aggregate
principal amount of the Global Securities may from time to time be increased or
decresaed by adjustments made on the records of the Trustee and the Depository
or its nominee as hereinafter provided.
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3
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.1(b) and pursuant to an order of the Company, authenticate and
deliver initially one or more Global Securities that (a) shall be registered in
the name of the Depository for such Global Security or Global Securities or the
nominee of such Depository and (b) shall be delivered by the Trustee to such
Depository or pursuant to such Depository's instructions or held by the Trustee
as custodian for the Depository.
Members of, or participants in, the Depository ("Agent Members")
shall have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depository or by the Trustee as the custodian of the
Depository or under such Global Security, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices of such Depository governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.
(c) Definitive Securities. Except as provided in this Section 2.1 or
Sections 2.3 or 2.4, owners of beneficial interests in Global Securities will
not be entitled to receive physical delivery of certificated Securities.
2.2 Authentication. The Trustee shall authenticate and deliver: (1)
Initial Securities for original issue in an aggregate principal amount of
$250,000,000 and (2) Exchange Securities for issue only in a Registered Exchange
Offer pursuant to the Registration Agreement, for a like principal amount of
Initial Securities, upon a written order of the Company signed by two Officers
or by an Officer and either an Assistant Treasurer or an Assistant Secretary of
the Company. Such order shall specify the amount of the Securities to be
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4
authenticated and the date on which the original issue of Securities is to be
authenticated and whether the Securities are to be Initial Securities or
Exchange Securities. The aggregate principal amount of Securities outstanding
at any time may not exceed $250,000,000, except as provided in Section 2.07 of
this Indenture.
2.3 Transfer and Exchange. (a) Transfer and Exchange of Definitive
Securities. When Definitive Securities are presented to the Registrar or a
co-registrar with a request:
(x) to register the transfer of such Definitive Securities; or
(y) to exchange such Definitive Securities for an equal principal
amount of Definitive Securities of other authorized denominations,
the Registrar or co-registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Securities surrendered for transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar
or co-registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing; and
(ii) are being transferred or exchanged pursuant to an effective
registration statement under the Securities Act, pursuant to Section
2.3(b) or pursuant to clause (A), (B) or (C) below, and are accompanied by
the following additional information and documents, as applicable:
(A) if such Definitive Securities are being delivered to the
Registrar by a Holder for registration in the name of such Holder,
without transfer, a certification from such Holder to that effect (in
the form set forth on the reverse of the Security); or
(B) if such Definitive Securities are being transferred to the
Company, a certification to that effect (in the form set forth on the
reverse of the Security); or
(C) if such Definitive Securities are being transferred pursuant
to an exemption from registration in accordance with Rule 144, (i) a
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certification to that effect (in the form set forth on the reverse of
the Security) and (ii) if the Company or Registrar so requests, an
opinion of counsel or other evidence reasonably satisfactory to them
as to the compliance with the restrictions set forth in the legend
set forth in Section 2.3(d)(i).
(b) Restrictions on Transfer of a Definitive Security for a
Beneficial Interest in a Global Security. A Definitive Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Trustee of
a Definitive Security, duly endorsed or accompanied by appropriate instruments
of transfer, in form satisfactory to the Trustee, together with:
(i) certification, in the form set forth on the reverse of the
Security, that such Definitive Security is being transferred (A) to a
QIB in accordance with Rule 144A, or (B) outside the United States in
an offshore transaction within the meaning of Regulation S and in
compliance with Rule 904 under the Securities Act; and
(ii) written instructions directing the Trustee to make, or to
direct the Securities Custodian to make, an adjustment on its books
and records with respect to such Global Security to reflect an
increase in the aggregate principal amount of the Securities
represented by the Global Security, such instructions to contain
information regarding the Depository account to be credited with such
increase,
then the Trustee shall cancel such Definitive Security and cause, or direct the
Securities Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depository and the Securities Custodian, the
aggregate principal amount of Securities represented by the Global Security to
be increased by the aggregate principal amount of the Definitive Security to be
exchanged and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Global Security
equal to the principal amount of the Definitive Security so cancelled. If no
Global Securities are then outstanding and the Global Security has not been
previously exchanged pursuant to Section 2.4, the Company shall issue and the
Trustee shall authenticate, upon written order of the Company in the form of an
Officers' Certificate, a new Global Security in the appropriate principal
amount.
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6
(c) Transfer and Exchange of Global Securities. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be effected
through the Depository, in accordance with this Indenture (including applicable
restrictions on transfer set forth herein, if any) and the procedures of the
Depository therefor. A transferor of a beneficial interest in a Global Security
shall deliver a written order given in accordance with the Depositary's
procedures containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in the Global Security and
such account shall be credited in accordance with such instructions with a
beneficial interest in the Global Security and the account of the Person making
the transfer shall be debited by an amount equal to the beneficial interest in
the Global Security being transferred.
(ii) Notwithstanding any other provisions of this Appendix A
(other than the provisions set forth in Section 2.4), a Global
Security may not be transferred as a whole except by the Depository
to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee
of such successor Depository.
(iii) In the event that a Global Security is exchanged for
Securities in definitive registered form pursuant to Section 2.4
prior to the consummation of a Registered Exchange Offer or the
effectiveness of a Shelf Registration Statement with respect to such
Securities, such Securities may be exchanged only in accordance with
such procedures as are substantially consistent with the provisions
of this Section 2.3 (including the certification requirements set
forth on the reverse of the Initial Securities intended to ensure
that such transfers comply with Rule 144A or Regulation S, as the
case may be) and such other procedures as may from time to time be
adopted by the Company.
(d) Legend
(i) Except as permitted by the following paragraphs (ii), (iii)
and (iv), each Security certificate evidencing the Global Securities
and the Definitive Securities (and all Securities issued in exchange
therefor or in substitution thereof) shall bear a legend in
substantially the following form:
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7
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING
THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY
MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE
SECOND ANNIVERSARY OF THE ISSUANCE HEREOF OR THE LAST DATE ON WHICH THE
COMPANY OR AN AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR
A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS AN AFFILIATE
OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF
SUCH TRANSFER, IN EITHER CASE. OTHER THAN (1) TO THE COMPANY, (2) SO LONG
AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE
BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE
REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE ON THE REVERSE OF THIS
SECURITY), AND, IF SUCH TRANSFER IS BEING EFFECTED BY CERTAIN TRANSFERORS
SPECIFIED IN THE INDENTURE (AS DEFINED BELOW) PRIOR TO THE EXPIRATION OF
THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF
REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF
APPLICABLE) UNDER THE SECURITIES ACT, OR (5) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER)
REGULATION S UNDER THE SECURITIES ACT."
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global
Security) pursuant to Rule 144 under the Securities Act:
(A) in the case of any Transfer Restricted Security that is a
Definitive Security, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a
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8
Definitive Security that does not bear the legend set forth above
and rescind any restriction on the transfer of such Transfer
Restricted Security; and
(B) in the case of any Transfer Restricted Security that is
represented by a Global Security, the Registrar shall permit the
Holder thereof to exchange such Transfer Restricted Security for a
Definitive Security that does not bear the legend set forth above
and rescind any restriction on the transfer of such Transfer
Restricted Security,
in either case, if the Holder certifies in writing to the Registrar that its
request for such exchange was made in reliance on Rule 144 (such certification
to be in the form set forth on the reverse of the Initial Security).
(iii) After a transfer of any Initial Securities during the period
of the effectiveness of a Shelf Registration Statement with respect to
such Initial Securities, all requirements pertaining to legends on such
Initial Security will cease to apply, the requirements requiring any such
Initial Security issued to certain Holders be issued in global form will
cease to apply, and an Initial Security in certificated or global form
without legends will be available to the transferee of the Holder of such
Initial Securities upon exchange of such transferring Holder's
certificated Initial Security. Upon the occurrence of any of the
circumstances described in this paragraph, the Company will deliver an
Officers' Certificate to the Trustee instructing the Trustee to issue
Securities without legends.
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Securities pursuant to which certain Holders of
such Initial Securities are offered Exchange Securities in exchange for
their Initial Securities, all requirements pertaining to such Initial
Securities that Initial Securities issued to certain Holders be issued in
global form will cease to apply and certificated Initial Securities with
the restricted securities legend set forth in Exhibit 1 hereto will be
available to Holders of such Initial Securities that do not exchange their
Initial Securities, and Exchange Securities in certificated or global form
will be available to Holders that exchange such Initial Securities in such
Registered Exchange Offer. Upon the occurrence of any of the circumstances
described in this paragraph, the Company will deliver an Officers'
Certificate to the Trustee instructing the Trustee to issue Securities
without legends.
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9
(e) Cancellation or Adjustment of Global Security. At such time as
all beneficial interests in a Global Security have either been exchanged for
certificated or Definitive Securities, redeemed, repurchased or canceled, such
Global Security shall be returned to the Depository for cancellation or retained
and canceled by the Trustee. At any time prior to such cancellation, if any
beneficial interest in a Global Security is exchanged for certificated or
Definitive Securities, repurchased or canceled, the principal amount of
Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Trustee (if it is then
the Securities Custodian for such Global Security) with respect to such Global
Security, by the Trustee or the Securities Custodian, to reflect such reduction.
(f) Obligations with Respect to Transfers and Exchanges of
Securities.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate certificated Securities,
Definitive Securities and Global Securities at the Registrar's or
co-registrar's request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any such
transfer taxes, assessments or similar governmental charge payable upon
exchange or transfer pursuant to Section 3.08).
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of any Security for a period
beginning 15 days before the mailing of a notice of an offer to repurchase
Securities or 15 days before an interest payment date.
(iv) Prior to the due presentation for registration of transfer of
any Security, the Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and interest on such Security and for
all other purposes whatsoever, whether or not such Security is overdue,
and none of the Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar shall be affected by notice to the contrary.
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10
(v) All Securities issued upon any transfer or exchange pursuant to
the terms of this Indenture shall evidence the same debt and shall be
entitled to the same benefits under this Indenture as the Securities
surrendered upon such transfer or exchange.
(g) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in
the Depository or other Person with respect to the accuracy of the records
of the Depository or its nominee or of any participant or member thereof,
with respect to any ownership interest in the Securities or with respect
to the delivery to any participant, member, beneficial owner or other
Person (other than the Depository) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Securities. All notices and communications to be given to the Holders and
all payments to be made to Holders under the Securities shall be given or
made only to the registered Holders (which shall be the Depository or its
nominee in the case of a Global Security). The rights of beneficial owners
in any Global Security shall be exercised only through the Depository
subject to the applicable rules and procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its members, participants and
any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between
or among Depository participants, members or beneficial owners in any
Global Security) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do so
if and when expressly required by, the terms of this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
2.4 Certificated Securities
(a) A Global Security deposited with the Depository or with the
Trustee as custodian for the Depository pursuant to Section 2.1 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities in an aggregate
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principal amount equal to the principal amount of such Global Security, in
exchange for such Global Security, only if such transfer complies with Section
2.3 and (i) the Depository notifies the Company that it is unwilling or unable
to continue as Depository for such Global Security or if at any time such
Depository ceases to be a "clearing agency" registered under the Exchange Act
and a successor depositary is not appointed by the Company within 90 days of
such notice, or (ii) an Event of Default has occurred and is continuing or (iii)
the Company, in its sole discretion, notifies the Trustee in writing that it
elects to cause the issuance of certificated Securities under this Indenture.
(b) Any Global Security that is transferable to the beneficial
owners thereof pursuant to this Section 2.4 shall be surrendered by the
Depository to the Trustee, to be so transferred, in whole or from time to time
in part, without charge, and the Trustee shall authenticate and deliver, upon
such transfer of each portion of such Global Security, an equal aggregate
principal amount of certificated Initial Securities of authorized denominations.
Any portion of a Global Security transferred pursuant to this Section shall be
executed, authenticated and delivered only in denominations of $1,000 and any
integral multiple thereof and registered in such names as the Depository shall
direct. Any certificated Initial Security delivered in exchange for an interest
in the Global Security shall, except as otherwise provided by Section 2.3(d),
bear the restricted securities legend set forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.4(b), the registered
Holder of a Global Security may grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.
(d) In the event of the occurrence of either of the events specified
in Section 2.4(a)(i), (ii) or (iii), the Company will promptly make available to
the Trustee a reasonable supply of certificated Securities in definitive, fully
registered form without interest coupons.
98
EXHIBIT 1
to APPENDIX A
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities 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 SECURITY 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 SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF
THE ISSUANCE HEREOF OR THE LAST DATE ON WHICH THE COMPANY OR AN AFFILIATE OF THE
COMPANY WAS THE OWNER OF THIS SECURITY (OR A PREDECESSOR SECURITY HERETO) OR (Y)
BY ANY HOLDER THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE
MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE, OTHER THAN (1) TO
THE COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER IS BEING
EFFECTED BY CERTAIN
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2
TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED BELOW) PRIOR TO THE
EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE
903(c)(3) OF REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE, (4) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER
THE SECURITIES ACT, OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A
QUALIFIED INSTITU TIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING
THE REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT.
100
EXHIBIT A
[FORM OF FACE OF SECURITY]
No. $__________
9.50% Senior Subordinated Note Due 2007
CUSIP No. ______
Xxxx Gaming Corporation, a Nevada corporation, promises to pay
to , or registered assigns, the principal sum of Dollars on July 15,
2007.
Interest Payment Dates: January 15 and July 15.
Record Dates: January 1 and July 1.
Additional provisions of this Security are set forth on the other
side of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be
duly executed.
XXXX GAMING CORPORATION,
by
-------------------------------
Name:
Title:
by
-------------------------------
Name:
Title:
[CORPORATE SEAL]
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2
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
Dated:
STATE STREET BANK AND
TRUST COMPANY,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By:
-------------------------
Authorized Signatory
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5
4. Indenture
The Company issued the Securities under an Indenture dated as of
July 22, 1997 (the "Indenture"), among the Company and the Trustee. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all such terms,
and Securityholders are referred to the Indenture and the TIA for a statement of
those terms.
The Securities are general unsecured obligations of the Company
limited to $250,000,000 aggregate principal amount (subject to Section 2.07 of
the Indenture). This Security is one of the Initial Securities referred to in
the Indenture. The Securities include the Initial Securities and any Exchange
Securities issued in exchange for the Initial Securities pursuant to the
Indenture. The Initial Securities and the Exchange Securities are treated as a
single class of securities under the Indenture. The Indenture imposes certain
limitations on the ability of the Company and its Restricted Subsidiaries to,
among other things, make certain Investments and other Restricted Payments, pay
dividends and other distributions, incur Indebtedness, enter into consensual
restrictions upon the payment of certain dividends and distributions by such
Restricted Subsidiaries, issue or sell shares of capital stock of such
Restricted Subsidiaries, enter into or permit certain transactions with
Affiliates, create or incur Liens and make Asset Sales. The Indenture also
imposes limitations on the ability of the Company to consolidate or merge with
or into any other Person or permit any other Person to merge with or into the
Company, or sell, convey, assign, transfer, lease or otherwise dispose of all or
substantially all of the Property of the Company.
5. Optional Redemption
Except as set forth in the next two paragraphs, the Securities may
not be redeemed prior to July 15, 2002. On and after that date, the Company may
redeem the Securities in whole at any time or in part from time to time at the
following redemption prices (expressed in percentages of principal amount), plus
accrued and unpaid interest, if any, to the redemption date (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date that is on or prior to the
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6
date of redemption), if redeemed during the 12-month period beginning on or
after July 15 of the years set forth below:
Redemption
Period Price
------ -----
2002........................................................ 104.750%
2003........................................................ 103.167%
2004 ....................................................... 101.583%
2005 and thereafter......................................... 100.000%
6. Redemption Pursuant to Gaming Laws; Sinking Fund
Pursuant to the Indenture, the Company will have the right to
require a Holder to dispose of such Holder's Securities if such Holder or the
beneficial owner of such Securities is not licensed or found qualified or
suitable by a Gaming Authority. In the event any such Holder fails to dispose of
Securities within a prescribed time period, the Company shall have the right to
call such Securities for redemption at a Redemption Price equal to the lesser of
(i) the lowest closing sale price of the Securities on any trading day during
the 120-day period ending on the date upon which the Company shall have received
notice from a Gaming Authority of such Holder's disqualification or (ii) the
price at which such Holder or beneficial owner acquired the Securities, unless a
different redemption price is required by such Gaming Authority, in which event
such required price shall be the Redemption Price.
The Securities are not subject to any sinking fund.
7. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his registered address. Securities in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued interest
on all Securities (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date interest ceases to accrue
on such Securities (or such portions thereof) called for redemption.
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7
8. Subordination
The Securities are subordinated to Senior Indebtedness of the
Company, as defined in the Indenture. To the extent provided in the Indenture,
Senior Indebtedness of the Company must be paid before the Securities may be
paid. The Company agrees, and each Securityholder by accepting a Security
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
9. Repurchase of Securities at the Option of Holders upon Change of Control
Upon the occurrence of (i) in the event at the Change of Control
Time the Securities do not have Investment Grade Status, a Change of Control or,
(ii) in the event at the Change of Control Time the Securities have Investment
Grade Status, a Change of Control Triggering Event, each Holder of Securities
shall have the right to require the Company to purchase such Holder's
Securities, in whole, or in part in a principal amount that is an integral
multiple of $1,000, pursuant to a Change of Control Offer, at a purchase price
in cash equal to 101% of the principal amount thereof on any Change of Control
Payment Date plus accrued and unpaid interest, if any, to the Change of Control
Payment Date.
Within 30 calendar days following any Change of Control Triggering
Event, the Company shall send, or cause to be sent, by first-class mail, postage
prepaid, a notice regarding the Change of Control Offer to the Trustee and each
Holder of Securities. The Holder of this Security may elect to have this
Security or a portion hereof in an authorized denomination purchased by
completing the form entitled "Option of Holder to Elect Purchase" appearing
below and tendering this Security pursuant to the Change of Control Offer.
Unless the Company defaults in the payment of the Change of Control Purchase
Price with respect thereto, all Securities or portions thereof accepted for
payment pursuant to the Change of Control Offer will cease to accrue interest
from and after the Change of Control Payment Date.
10. Repurchase of Securities at the Option of Holders upon
Asset Sale or Event of Loss
If at any time the Company or any Restricted Subsidiary engages in
any Asset Sale and/or an Event of Loss, as a result of which the aggregate
amount of Excess Proceeds exceeds $20,000,000, the Company shall, within 10
Business
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8
days of the date the amount of Excess Proceeds exceeds $20,000,000, use the
then-existing Excess Proceeds to make an offer to purchase from all Holders, on
a pro rata basis, Securities in an aggregate principal amount equal to the
maximum principal amount that may be purchased out of the then-existing Excess
Proceeds, at a purchase price in cash equal to 100% of the principal amount
thereof on any Purchase Date plus accrued and unpaid interest thereon, if any,
to the Purchase Date. Upon completion of a Prepayment Offer (including payment
for accepted Securities), any surplus Excess Proceeds that were the subject of
such offer shall cease to be Excess Proceeds, and the Company may then use such
amounts for general corporate purposes.
Within 10 Business days of the date the amount of Excess Proceeds
exceeds $20,000,000, the Company shall send, or cause to be sent, by first-class
mail, postage prepaid, a notice regarding the Prepayment Offer to each Holder of
Securities. The Holder of this Security may elect to have this Security or a
portion hereof in an authorized denomination purchased by completing the form
entitled "Option of Holder to Elect Purchase" appearing below and tendering this
Security pursuant to the Prepayment Offer. Unless the Company defaults in the
payment of the purchase price with respect thereto, all Securities or portions
thereof selected for payment pursuant to the Prepayment Offer will cease to
accrue interest from and after the Purchase Date.
11. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. Upon any transfer or
exchange, the Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or permitted by the Indenture.
12. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner
of it for all purposes.
13. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written request
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9
unless an abandoned property law designates another Person. After any such
payment, Holders entitled to the money must look only to the Company and not to
the Trustee for payment.
14. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some or all of its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
15. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any
Securityholder but with the written consent of the Holders of at least a
majority in principal amount of the outstanding Securities and (ii) any past
Default and its consequences may be waived with the written consent of the
Holders of at least a majority in principal amount of the outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Holder of Securities, the Company and the Trustee may amend
the Indenture or the Securities (i) to cure any ambiguity, omission, defect or
inconsistency; (ii) to comply with Article V of the Indenture; (iii) to provide
for uncertificated Securities in addition to or in place of certificated
Securities; (iv) to add Guarantees by Subsidiaries with respect to the
Securities and to release such Guarantees when required by the terms thereof;
(v) to secure the Securities; (vi) to add additional covenants or to surrender
rights and powers conferred on the Company; (vii) to comply with the
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the TIA; or (viii) to make any change that does not
adversely affect the rights of any Securityholder.
16. Defaults and Remedies
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities, subject to
certain limitations, may declare all the Securities to be immediately due and
payable. Certain events of bankruptcy or insolvency are Events of Default and
shall result in the Securities being immediately due and
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payable upon the occurrence of such Events of Default without any further act of
the Trustee or any Holder.
Holders of Securities may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power under the Indenture. The Holders of a majority in principal amount of the
outstanding Securities, by written notice to the Company and the Trustee, may
rescind any declaration of acceleration and its consequences if the rescission
would not conflict with any judgment or decree, and if all Events of Default
have been cured or waived except nonpayment of principal and interest that has
become due solely because of the acceleration.
17. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
18. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or the Trustee shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder waives and releases all such liability. The waiver
and release are part of the consideration for the issue of the Securities.
19. Authentication
This Security shall not be valid until an authorized signatory of
the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
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11
20. Abbreviations
Customary abbreviations may be used in the name of a Securityholder
or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. Governing Law
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS
MADE AND TO BE PERFORMED IN SAID STATE WITHOUT REFERENCE TO PRINCIPLES OF
CONFLICTS OF LAWS.
The Company will furnish to any Holder of Securities upon written
request and without charge to the Holder a copy of the Indenture which has in it
the text of this Security.
Requests may be made to:
Xxxx Gaming Corporation
0000 Xxxxx Xxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxx
Attention: General Counsel
22. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to
transfer this Security 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 other side of this Security.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Securities and the last date, if any, on which such Securities were
owned by the Company or any Affiliate of the Company, the undersigned confirms
that such Securities are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [ ] to the Company; or
(2) [ ] pursuant to an effective registration statement
under the Securities Act of 1933; or
(3) [ ] inside the United States to a "qualified
institutional buyer" (as defined in Rule 144A
under the Securities Act of 1933) that
purchases for its own account or for the
account of a qualified institutional buyer to
whom notice is given that such transfer is
being made in reliance on Rule 144A, in each
case pursuant to and in compliance with
Rule 144A under the Securities Act of 1933; or
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14
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated: ________________ ______________________________
NOTICE: To be executed by
an executive officer
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
Date of Amount of decrease Amount of increase Principal amount Signature of
Exchange in Principal in Principal of this Global authorized
Amount of this Amount of this Security following signatory of
Global Security Global Security such decrease or Trustee or
increase Securities
Custodian
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OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED
BY THE COMPANY PURSUANT TO SECTION 4.07 OR 4.12 OF THE INDENTURE,
CHECK THE BOX:
[ ]
IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS
SECURITY PURCHASED BY THE COMPANY PURSUANT TO SECTION 4.07 OR
4.12 OF THE INDENTURE, STATE THE AMOUNT:
$
DATE: __________________ YOUR SIGNATURE: __________________
(SIGN EXACTLY AS YOUR NAME APPEARS
ON THE OTHER SIDE OF THE SECURITY)
SIGNATURE GUARANTEE:_______________________________________
SIGNATURE MUST BE GUARANTEED BY A PARTICIPANT
IN A RECOGNIZED SIGNATURE GUARANTY MEDALLION
PROGRAM OR OTHER SIGNATURE GUARANTOR ACCEPTABLE
TO THE TRUSTEE
113
EXHIBIT A
[FORM OF FACE OF SECURITY]
No. $__________
9.50% Senior Subordinated Note Due 2007
CUSIP No. ______
Xxxx Gaming Corporation, a Nevada corporation, promises to pay to
________________, or registered assigns, the principal sum of___________ Dollars
on July 15, 2007.
Interest Payment Dates: January 15 and July 15.
Record Dates: January 1 and July 1.
Additional provisions of this Security are set forth on the other
side of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be
duly executed.
XXXX GAMING CORPORATION,
by
-------------------------------
Name:
Title:
by
-------------------------------
Name:
Title:
[CORPORATE SEAL]
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TRUSTEE'S CERTIFICATE OF
AUTHENTICATION Dated:
STATE STREET BANK AND TRUST COMPANY,
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
by
-----------------------------
Authorized Signatory
----------------------
*/ If the Security is to be issued in global form, add the Global Securities
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "TO BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".
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[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
9.50% Senior Subordinated Note Due 2007
1. Interest
Xxxx Gaming Corporation, a Nevada corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company"), promises to pay interest on the principal amount
of this Security at the rate per annum shown above. The Company will pay
interest semiannually on January 15 and July 15 of each year. Interest on the
Securities will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from July 22, 1997. Interest will be computed
on the basis of a 360-day year of twelve 30-day months. The Company shall pay
interest on overdue principal at the rate borne by the Securities plus 1% per
annum, and it shall pay interest on overdue installments of interest at the same
rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the January 1 or July 1 next preceding the interest payment date
even if Securities are canceled after the record date and on or before the
interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal and interest in money
of the United States of America that at the time of payment is legal tender for
payment of public and private debts. Payments in respect of the Securities
represented by a Global Security (including principal, premium and interest)
will be made by wire transfer of immediately available funds to the accounts
specified by The Depository Trust Company. The Company will make all payments in
respect of a certificated Security (including principal, premium and interest),
by mailing a check to the registered address of each Holder thereof; provided,
however, that payments on the Securities may also be made, in the case of a
Holder of at least $1,000,000 aggregate principal amount of Securities, by wire
transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately
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4
preceding the relevant due date for payment (or such other date as the Trustee
may accept in its discretion).
3. Paying Agent and Registrar
Initially, State Street Bank and Trust Company, a Massachusetts
banking corporation (the "Trustee"), will act as Paying Agent and Registrar. The
Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as of
July 22, 1997 (the "Indenture"), among the Company and the Trustee. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all such terms,
and Securityholders are referred to the Indenture and the TIA for a statement of
those terms.
The Securities are general unsecured obligations of the Company
limited to $250,000,000 aggregate principal amount (subject to Section 2.07 of
the Indenture). This Security is one of the Exchange Securities referred to in
the Indenture. The Securities include the Initial Securities and any Exchange
Securities issued in exchange for the Initial Securities pursuant to the
Indenture. The Initial Securities and the Exchange Securities are treated as a
single class of securities under the Indenture. The Indenture imposes certain
limitations on the ability of the Company and its Restricted Subsidiaries to,
among other things, make certain Investments and other Restricted Payments, pay
dividends and other distributions, incur Indebtedness, enter into consensual
restrictions upon the payment of certain dividends and distributions by such
Restricted Subsidiaries, issue or sell shares of capital stock of such
Restricted Subsidiaries, enter into or permit certain transactions with
Affiliates, create or incur Liens and make Asset Sales. The Indenture also
imposes limitations on the ability of the Company to consolidate or merge with
or into any other Person or permit any other Person to merge with or into the
Company, or sell, convey, assign,
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5
transfer, lease or otherwise dispose of all or substantially all of the Property
of the Company.
5. Optional Redemption
Except as set forth in the next two paragraphs, the Securities may
not be redeemed prior to July 15, 2002. On and after that date, the Company may
redeem the Securities in whole at any time or in part from time to time at the
following redemption prices (expressed in percentages of principal amount), plus
accrued and unpaid interest, if any, to the redemption date (subject to the
right of Holders of record on the relevant record date to receive interest due
on the relevant interest payment date that is on or prior to the date of
redemption), if redeemed during the 12-month period beginning on or after July
15 of the years set forth below:
Redemption
Period Price
------ -----
2002............................................... 104.750%
2003............................................... 103.167%
2004 .............................................. 101.583%
2005 and thereafter................................ 100.000%
6. Redemption Pursuant to Gaming Laws; Sinking Fund
Pursuant to the Indenture, the Company will have the right to
require a Holder to dispose of such Holder's Securities if such Holder or the
beneficial owner of such Securities is not licensed or found qualified or
suitable by a Gaming Authority. In the event any such Holder fails to dispose of
Securities within a prescribed time period, the Company shall have the right to
call such Securities for redemption at a Redemption Price equal to the lesser of
(i) the lowest closing sale price of the Securities on any trading day during
the 120-day period ending on the date upon which the Company shall have received
notice from a Gaming Authority of such Holder's disqualification or (ii) the
price at which such Holder or beneficial owner acquired the Securities, unless a
different redemption price is required by such Gaming Authority, in which event
such required price shall be the Redemption Price.
The Securities are not subject to any sinking fund.
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6
7. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his registered address. Securities in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued interest
on all Securities (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date interest ceases to accrue
on such Securities (or such portions thereof) called for redemption.
8. Subordination
The Securities are subordinated to Senior Indebtedness of the
Company, as defined in the Indenture. To the extent provided in the Indenture,
Senior Indebtedness of the Company must be paid before the Securities may be
paid. The Company agrees, and each Securityholder by accepting a Security
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
9. Repurchase of Securities at the Option of Holders upon Change of Control
Upon the occurrence of (i) in the event at the Change of Control
Time the Securities do not have Investment Grade Status, a Change of Control or,
(ii) in the event at the Change of Control Time the Securities have Investment
Grade Status, a Change of Control Triggering Event, each Holder of Securities
shall have the right to require the Company to purchase such Holder's
Securities, in whole, or in part in a principal amount that is an integral
multiple of $1,000, pursuant to a Change of Control Offer, at a purchase price
in cash equal to 101% of the principal amount thereof on any Change of Control
Payment Date plus accrued and unpaid interest, if any, to the Change of Control
Payment Date.
Within 30 calendar days following any Change of Control Triggering
Event, the Company shall send, or cause to be sent, by first-class mail, postage
prepaid, a notice regarding the Change of Control Offer to the Trustee and each
Holder of Securities. The Holder of this Security may elect to have this
Security or a portion hereof in an authorized denomination purchased by
completing the form entitled "Option
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7
of Holder to Elect Purchase" appearing below and tendering this Security
pursuant to the Change of Control Offer. Unless the Company defaults in the
payment of the Change of Control Purchase Price with respect thereto, all
Securities or portions thereof accepted for payment pursuant to the Change of
Control Offer will cease to accrue interest from and after the Change of Control
Payment Date.
10. Repurchase of Securities at the Option of Holders upon
Asset Sale or Event of Loss
If at any time the Company or any Restricted Subsidiary engages in
any Asset Sale and/or an Event of Loss, as a result of which the aggregate
amount of Excess Proceeds exceeds $20,000,000, the Company shall, within 10
Business days of the date the amount of Excess Proceeds exceeds $20,000,000, use
the then-existing Excess Proceeds to make an offer to purchase from all Holders,
on a pro rata basis, Securities in an aggregate principal amount equal to the
maximum principal amount that may be purchased out of the then-existing Excess
Proceeds, at a purchase price in cash equal to 100% of the principal amount
thereof on any Purchase Date plus accrued and unpaid interest thereon, if any,
to the Purchase Date. Upon completion of a Prepayment Offer (including payment
for accepted Securities), any surplus Excess Proceeds that were the subject of
such offer shall cease to be Excess Proceeds, and the Company may then use such
amounts for general corporate purposes.
Within 10 Business days of the date the amount of Excess Proceeds
exceeds $20,000,000, the Company shall send, or cause to be sent, by first-class
mail, postage prepaid, a notice regarding the Prepayment Offer to each Holder of
Securities. The Holder of this Security may elect to have this Security or a
portion hereof in an authorized denomination purchased by completing the form
entitled "Option of Holder to Elect Purchase" appearing below and tendering this
Security pursuant to the Prepayment Offer. Unless the Company defaults in the
payment of the purchase price with respect thereto, all Securities or portions
thereof selected for payment pursuant to the Prepayment Offer will cease to
accrue interest from and after the Purchase Date.
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11. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. Upon any transfer or
exchange, the Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or permitted by the Indenture.
12. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner
of it for all purposes.
13. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must look
only to the Company and not to the Trustee for payment.
14. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some or all of its obligations under the Securities and the Indenture if the
Company deposits with the Trustee money or U.S. Government Obligations for the
payment of principal and interest on the Securities to redemption or maturity,
as the case may be.
15. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any
Securityholder but with the written consent of the Holders of at least a
majority in principal amount of the outstanding Securities and (ii) any past
Default and its consequences may be waived with the written consent of the
Holders of at least a majority in principal amount of the outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Holder of Securities, the Company and the Trustee may amend
the Indenture or the Securities (i) to cure any ambiguity, omission, defect or
inconsistency; (ii) to
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9
comply with Article V of the Indenture; (iii) to provide for uncertificated
Securities in addition to or in place of certificated Securities; (iv) to add
Guarantees by Subsidiaries with respect to the Securities and to release such
Guarantees when required by the terms thereof; (v) to secure the Securities;
(vi) to add additional covenants or to surrender rights and powers conferred on
the Company; (vii) to comply with the requirements of the Commission in order to
effect or maintain the qualification of the Indenture under the TIA; or (viii)
to make any change that does not adversely affect the rights of any
Securityholder.
16. Defaults and Remedies
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities, subject to
certain limitations, may declare all the Securities to be immediately due and
payable. Certain events of bankruptcy or insolvency are Events of Default and
shall result in the Securities being immediately due and payable upon the
occurrence of such Events of Default without any further act of the Trustee or
any Holder.
Holders of Securities may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power under the Indenture. The Holders of a majority in principal amount of the
outstanding Securities, by written notice to the Company and the Trustee, may
rescind any declaration of acceleration and its consequences if the rescission
would not conflict with any judgment or decree, and if all Events of Default
have been cured or waived except nonpayment of principal and interest that has
become due solely because of the acceleration.
17. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
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18. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or the Trustee shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder waives and releases all such liability. The waiver
and release are part of the consideration for the issue of the Securities.
19. Authentication
This Security shall not be valid until an authorized signatory of
the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
20. Abbreviations
Customary abbreviations may be used in the name of a Securityholder
or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. Governing Law
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS
MADE AND TO BE PERFORMED IN SAID STATE WITHOUT REFERENCE TO PRINCIPLES OF
CONFLICTS OF LAWS.
The Company will furnish to any Holder of Securities upon written
request and without charge to the Holder a copy of the Indenture which has in it
the text of this Security.
Requests may be made to:
Xxxx Gaming Corporation
0000 Xxxxx Xxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxx
Attention: General Counsel
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22. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
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ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to
transfer this Security 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 other side of this Security. Signature
must be guaranteed by a participant in a recognized signature guaranty medallion
program or other signature guarantor acceptable to the Trustee.
125
13
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.07 or 4.12 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.07 or 4.12 of the Indenture, state the amount:
$
Date: __________________ Your Signature: __________________
(Sign exactly as your name appears
on the other side of the Security)
Signature Guarantee:_______________________________________
Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other
signature guarantor acceptable to the
Trustee.
